We had a terrible CPI reading yesterday. The original announcement caused the market to crash, but during the US trading day, the market quickly made up all of its losses and then some.
I anticipated continuing adverse price action, as did many other market investors. This big move downwards was totally unexpected, yet it makes sense looking back.
There could be a thousand explanations for what transpired yesterday, but in my opinion, the main factor was that too many traders were already short and nobody wanted to sell more after a significant -4% candle. a traditional short squeeze.
This optimistic price action, in my opinion, won't sustain. The outlook for the macroeconomy has only become worse, prompting additional increases in interest rates. This rally may continue for a few more days, but ultimately we're likely to continue to decline.
I won't be convinced until both of the following:
1. A break out of the bearish triangle's upper resistance (note the big reversal a couple of hours ago)
We've been trading in a horizontal range for almost two months, so I'd like to see a break out before I start thinking positive. 2. A daily candle close above $20.5k.
I anticipated continuing adverse price action, as did many other market investors. This big move downwards was totally unexpected, yet it makes sense looking back.
There could be a thousand explanations for what transpired yesterday, but in my opinion, the main factor was that too many traders were already short and nobody wanted to sell more after a significant -4% candle. a traditional short squeeze.
This optimistic price action, in my opinion, won't sustain. The outlook for the macroeconomy has only become worse, prompting additional increases in interest rates. This rally may continue for a few more days, but ultimately we're likely to continue to decline.
I won't be convinced until both of the following:
1. A break out of the bearish triangle's upper resistance (note the big reversal a couple of hours ago)
We've been trading in a horizontal range for almost two months, so I'd like to see a break out before I start thinking positive. 2. A daily candle close above $20.5k.
Comment:
Additionally, the 1-hour time chart's ema 50 indicator retested the ema 200, indicating a short-term bearish swing.