Hey Traders,

some new technical developments in euro currency and dollar index past few days.

Firstly, as mentioned in previous daily euro summary,  considering recent overbought conditions and 1000+ pip run up in the euro over the past month, will be looking for small technical breakdowns to start buidling bearish case. Earlier today one of the steep uptrend lines (dotted) was broken resulting in some sell off into the close:

Euro is currently at support of what looks like possible bull flag with lofty target of another 600 pips of upside shall it play out. Next high probability long entry seems to be retracement of 2-3 week action and previous resistance level, which also happens to line up with the trendline shall EC trade down to that level within next 2 days.

With key support level below there being a larger retracement of the whole 1000+ pip monthly move right in the area of two key moving averages on the daily chart

Another key development on the daily chart is that 50 ema crossed above 200dma at the start of the new futures session, for the first time since April 2006:

Last time it resulted in a huge multi-year bull run for the euro all the way through 2008.

How dollar index will play out will be key in determining further euro direction:

Dollar index has found some support at psychological 80 level which also happens to be 50% retracement from a decade low. 50Ema is withing 0.36 of corssing under 200dma with short ambush lining up in that area very similarly to the euro chart.

The way these set ups play out will be key in determining next longer term trends in euro and the dollar.

Cheers

Vlad

Hey Traders,

another day in the box of chop, with now possibly entertaining a wedge scenario:

The target of this possible wedge would be the same as of the box play few ticks withing the 38% retracemnt of the whole rally at 826. Confirmation would be close below the key 872 level. Starting tomorrow 200dma will be below the rally highs. Break and close above 200dma would suggest another 50 points of upside.

If for some reason you do feel the need to play this chop zone intraday, highest probability trade is probably the one just like today, which we had to wait all day for and only got a 6 pt bounce out of:

Now considering ambush from the lows is broken, will be looking for the same type of play, except from the highs

Considering 890.5 is the low , 901.5 would be that retracement level that is worth a stab at a short entry. With support levels expected at previous three time resistance on the daily charts 872 and big fib confluence at 866. Close below 872 and more so both of those levels would suggest a trip to 820s.

There is also a lot of economic data due out tomorrow morning that should have major affect on the markets

Hopefully we will be out of this range soon, whichever way market chooses to move. Until then people will keep flip flopping and recounting their counts from bearish to bullish on every 10 pt  move. Hopefully you trade some other markets or implement other strategies to keep yourself busy during this chop of hell

Cheers

Vlad

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Cheers

Vlad

Update Cash Close:
ES got a decent bounce at that support level and then sold off hard, further confirming box of hellish whipsaw, hopefully to be resolved soon.

Once again no key technical developments on the daily charts, but still feel free to check back later for daily updates

Cheers

Vlad

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Update 1:40pm EST:
Staying patient/bored waiting for ES o get to some more significant level, still watching this retracement of yesterdays squeeze and previous s/r level:

Update 1:21pm EST:
9.25 pt range on ES since futures re-opened yesterday! I almost wish I took another day off

Update 12:55pm EST:
aaaand 1.5 hrs later nothing new to see…

Update 11:36am EST:
1.3931 is new ambush from 1.3993 high /previous intraday high

Update 11:06am EST:
Euro didn’t quiet make it to the ambush and sold off nicely. Now that 1.3939 level is off the table. Watching for bottom of bull flag from the hourly chart for support and then another key area from Daily update which is another 120+ pips down.

ES continues to consolidate into the lunch time.

Update 10:57am EST:
Watching 1.3939 ambush on the EC to further build bearish case after recent trendline on the hourly was broken.

Longer term, this could also be developing into a huge bull flag with target in 1.45s

Update: Housing Data at 10am EST

===========================

Good Morning Traders,

not much has changed since last nights updates, will be watching for ambush zone, previous resistance level to act as support on the downside

And 200dma which should lign up with rally highs on the upside.

Once, again we are in a “box” of chop on ES and rather far away from key ;evels on euro and gold, so this shall remain scalpers market for now.

Good luck and great trading today

Vlad