Weekly: the down-trend is still rock solid. We are within the support area of 1840-1850. Some price volatility is to be expected here.
Daily: the market covered a lot of territory yesterday (around 80 points), but ended with a big shadow in our support area, similar to previous attempts at testing these levels.
Also worth mentioning that big volumes were traded on the retracement.
Up until now the market has also managed to hold below the 8-Day Moving Average. A break and close above this 8 SMA (now at 1888) would mean the market is attempting a retracement. I will discuss shorting opportunities if this scenario is validated.
Short-term frames:
What I find most striking at yesterday's price movement is that when the market fell below the 1840 support level, it did so with decreasing volumes. I believe this triggered the bounce back in prices in the second part of the trading day. As the market got tired right when it was supposed to get momentum, I believe there were quite a few traders that reduced their positions, triggering even more to do so on the bounce back up. Hence the increase in volumes.
All in all, be aware of how the market reacted in this area and trade accordingly. Today should give us a clue about what to expect next. A continuation of the trend below 1840, or an attempt at a retracement.
Feel free to drop any comments below.
Daily: the market covered a lot of territory yesterday (around 80 points), but ended with a big shadow in our support area, similar to previous attempts at testing these levels.
Also worth mentioning that big volumes were traded on the retracement.
Up until now the market has also managed to hold below the 8-Day Moving Average. A break and close above this 8 SMA (now at 1888) would mean the market is attempting a retracement. I will discuss shorting opportunities if this scenario is validated.
Short-term frames:
All in all, be aware of how the market reacted in this area and trade accordingly. Today should give us a clue about what to expect next. A continuation of the trend below 1840, or an attempt at a retracement.
Feel free to drop any comments below.
