MARKET COMMENTARY –
The failure and recapture of the 2880 support gives us the environment that holds fairly bullish but we are in a little holding pattern with retail sales and industrial production coming tomorrow. Jobless claims are ahead today but I suspect just a noisy patch of movement between a range. The ability to breach and hold 2923 will reverse the broken trend that appeared at the end of April. Until then, however, we are looking at formations that are likely to weaken with each bounce before breaking again.
BIG PICTURE -The weekly bearish trigger went off at the failed retest of 2923 with the confirmation at the loss of 2913 after that. The final support target near 2839 for me gave us a trigger of support and this is the support bounce formation that we are running through. We are still in the wait state and trading the formations in-between the resolution of price behavior of the current scenario and today.
RECAP -The long countertrend push higher in the markets though present, is faltering. The Fed funds rate futures still predicts a high likelihood of rate reduction ahead and the dollar is still battling at support for a third day and as gold recaptures its breakout levels near 1339. Bonds are still stalling out a bit, even as chatter about yields falling further looms as forward. $ES_F Buyers stronger above 2886.75 but face resistance to 2923.
-Sellers want to move us below 2878 intraday. Pullbacks into higher lows will be buy zones intraday and traders have a bullish slant overall.
TAKEAWAY – Bullish bounce in an intermediate bearish trend signal tells us that for the moment as long as we hold higher supports, we will either stay in the range or head higher. The backdrop of global slowdown and trade chatter still prevails.
Divergent action still sits below the movement of price on both sides of the trades – long and short – but traders are still looking at deep support edges to bounce. The counter trend bounce tries to hold a footing.
DEEP DIPS AND WIDE SPIKES IN PRICES ARE ALWAYS A STRONGER PROBABILITY WHEN THE SWING SIGNAL IS AT A CROSS CURRENT TO THE TREND
ALERT – Still negative formations hold in the swing short – charts are likely to bounce to lower highs. Very excited to see these higher levels from which I can initiate a new short once more.
Divergence and defense of recent lows tell us buyers are still in the fight as sellers engage actively Here’s a link to the METASTOCK software
IF YOU DON’T JOURNAL YOUR PROGRESS, YOU SHOULD – How about finally starting that trading journal?
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