We have a few cnfuences which falls in line with my trading strategy:
1. Price is at a key level of resistance
2. We can see slight divergence on the 1hr timeframe
3. The moving averages have crossed to the downside on the 1hr timeframe
4. We have had a strong push which makes me believe that a pullback/exhaustion is in order
As always respect your risk...
We have the following confluences:
1. Prce at a key level of resistance
2. big bearish engulfing candle
3. Divergence on the 15min timeframe
4. Moving average crossover on the lower timeframe.
5. Break and retest of structure on the 5min timeframe (support now acting as resistance
Very similar to GBPUSD
1. Market making lower highs and lower lows.
2. Break of support
3. Waiting for a pullback to test and confirm new found resistance.
4. Entre a short position on the lower timeframes
We can see a shift in the market direction by the series of lower highs we can see on the chart (this can be seen be the use of the yellow circles) the market is now forming lower highs so it is safe to say that we can expect the market to continue in this fashion by forming another lower high and then continuing with the short term trend by forming a lower low....
This is looking more and more like a bull trap the more i look at it...
We've seen a strong push to the upside around 20% or so from the lows and now everyone thinks its "bull season" I'm sure most of you is aware of the dead cat bounce theory, and for those of you who don't it is basically the thought that if you drop a cat off the roof it will bounce a bit...