Drama, it's everywhere. As soon as price moves more than people were expecting, the first thing they seek is "Why?". A story of any kind to fill in the painful void of uncertainty. And you will find plenty of drama, because it generates ad revenue.
When I see a market move of this nature, the first thing I check is the level, and the next thing is the formation. I could care less why. Eventually, someone will tell me and I didn't have to waste any time searching for news. By the time I find out "why", my trading plan has been made, and action or non action has been taken. I mention this because this market is presenting a great example.
momentum is pushing price into a very attractive . 8044 is the reversal zone boundary relative to the 8204 low. This is an area that offers a high probability trade IF a setup can materialize. If it cannot, and price instead falls through, then there is simply no trade to take. Stay flat and wait.
Keep in mind price is now below the 8171 support which is the .618 of the entire structure all the way back to the 150 lows. This reaches all the way to 4559. Can price get there? No one can predict that. We can say that within this broad zone there is a much higher probability that price finds support and mounts a broader reversal.
In summary, the level is the first variable we consider when it comes to isolating a swing trade long opportunity. Momentum is so price can keep going, but what if it doesn't? What if instead, the next candle forms an inside bar? Or a pin bar? What do you think that means? It means a short squeeze is likely and an opportunity for a swing trade long will be present. On S.C. we use these factors along with other criteria to isolate high probability setups and then broadcast the signal to our followers. We will be watching the current level closely. Check out S.C. for updates.
Questions and comments welcome.