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MARKET COMMENTARY -Kick off of the new quarter and earnings session which is certain to underwhelm as the slowdown continues. Price has stalled with more bounce and upside likely into 3000. The higher support line is now around 2971. Volume in the markets remain very light, suggesting some other liquidity issues- which means we are likely still rangebound but with a bit more bearish risk. Market volatility remains a concern.
WEEKLY PRICE ACTION
Buyers and sellers battle between weekly levels of 2946 and 3012 with neutral momentum in play – edges of contention range remain as in weeks past, between 2984 and 2991- the current location of our struggle at this writing. Above that mark and we’ll head to the higher resistance levels near 3006 to 3015 to breach. Neutral action, flattening momentum, and range bound prices are now present. Bigger picture- all the watched indices are still in breakout formations. This makes for a messy patch of trading.
The line in the sand today is 2991.75 – above this zone, buyers will be more brave. Sellers hold the upper hand below 2972.
COMMODITY & CURRENCY WATCH
Gold prices have responded to negative divergence and are in a solid fade bringing us right to the edge of our lower target near 1472 before buyers have attempted stepping in. We are in a struggle to hold but I suspect traders will try to hold this region for a time. The region near 1504 is now primary resistance. Deep pullbacks remain active buy zones – short positioning will require careful attention. The US dollar is holding its upside breakout and is now above prior resistance of 99.4. My suspicion is that traders are looking for 100. WTI has fallen back into below the 55 support area as fears of global slowing continue. Failure to close the week above 55 will be quite bearish.
TRADING VIEW & ACTION PLAN
Buyers are struggling near 2984. Pullbacks are still the best places to engage if risk exposure is your primary concern and you are considering long action. Trade the edges of these formations and realize that we could bounce higher than anticipated and fade deeper than anticipated on the monthly close and quarterly close before returning to the range. Follow the trend in the shorter time frames and watch the price action. The theme of motion is NEGATIVE AS LONG AS WE HOLD BELOW 2972ish today -and POSITIVE AS LONG AS WE HOLD ABOVE 2992ish today. Do what’s working and watch for weakness of trend. Please log in for the definitive levels of engagement today.
METASTOCK SWING SHORT – in a wait state –will engage at the bounce into 2996 again with a 12 point stop; if we come into the stop region (within 2 points – I will add to the position)
METASTOCK SWING LONG – inactive
Intraday LONG trading from support edges like the VWAP or solid moving averages will give you the least risk event for engaging. Intraday SHORT trading from resistance edges like the old highs will give you the least risk event for engaging. Follow the candle trend until candles stop breaking higher.
IF YOU DON’T JOURNAL YOUR PROGRESS, YOU SHOULD – How about finally starting that trading journal?
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