Good Morning Traders!
All indexes continued to fill out range on the 120 minute charts. Volume was on the lighter side, breadth remained negative all day, and the market closed around its opening price. A power sell structure has formed on the DOW, which sugggests a retest down. However, if the afternoon HIGH is taken out, there will be two higher lows highs in place which can lead to a better upside breakout. Obviously ECB meeting can serve as a catalyst for large moves in either direction. It is pointless to speculate on the way price will behave. The lower charts show what all market particpants are watching – the breakout formations on the intraday charts. The DOW weekly has already pushed down to the middle of a large trading range. Market internals are deeply oversold. The weekly charts can still trend to the lower end of the range though, OR, it will resolve itself to test the upper end of this range.
The EC will move big as well. Noted on the chart are the significant levels to watch. Bunds and Boble – breakout chart formations as well. Though gold and silver were highly erratic (thanx to overzealous bots), they still are in an uptrending channel on the hourly charts. Impossible to predict how they will trade – Wednesday’s value area was just too big of a range.
Strong trends in some of the softs as well as the grains: trades back into the prior days value area equate with grail buys on retracements to intraday moving averages.
Keep an open mind: In the past the markets have made strong test in one direction with reject and trend in the opposite direction, OR, it has been a one way directional move from the start. IF the sequence is test reject reverse, it will be obvious relatively quickly.
Happy trading! Linda