Multiple headlines triggered the upside rally for today's session. Most of the movement happened in the overnight session. The day session retested the resistance level and found responsive sellers. Could be a risk off going into the weekend. Such a strong move created an overbought condition with a negative divergence. Next week would be telling whether the buyers would like to retest the all time high or would take some time off consolidating between the inflection points.
Several times I mentioned that the bias established within a day session usually remains unchanged. Unless, some news that makes a strong reversal of the sentiment. Keep in mind that the machines are designed to follow the trend. There is no much intellect behind that and definitely no rational regarding the value. Overbought/oversold conditions are warning signs but they don't stop the machines from trend following. Contra trades require precise entries since the risk/reward is limited. If you are not seeing where to enter then better to wait for a pullback and ride the trend. That would be less risky.
Notice the current structure and the steep trend line. This is something to watch. Without a strong break of the trend line a potential scenario is to see a consolidation before a new directional move either upside or downside starts.
10/11/2019
Several times I mentioned that the bias established within a day session usually remains unchanged. Unless, some news that makes a strong reversal of the sentiment. Keep in mind that the machines are designed to follow the trend. There is no much intellect behind that and definitely no rational regarding the value. Overbought/oversold conditions are warning signs but they don't stop the machines from trend following. Contra trades require precise entries since the risk/reward is limited. If you are not seeing where to enter then better to wait for a pullback and ride the trend. That would be less risky.
Notice the current structure and the steep trend line. This is something to watch. Without a strong break of the trend line a potential scenario is to see a consolidation before a new directional move either upside or downside starts.
10/11/2019
