Hey Traders, rather boring day today, unless you were initially short or were playing the channel on the tick chart posted in intraday analysis. A lot of ambushes were dirty and tape was overall choppy.
Here is end of day trend summary:
Euro trend has been bearish all the way since Friday and has found support 20 pips away from 50% retracement of the rally from the lows. 15minute, 5000contract, and 60 minute charts put in at least 2 green bars suggesting at least short term bull trend could be in the making while 120 minute is putting in first green candle.
On ES Hourly and 120 minute trend is still red going back to 825s on Friday (great sell signal), with 100k contract chart producing three consecutive green bars suggesting possible short term retracement.
Here is a bigger picture:
ES has clearly broken down from the recent wedge formation on the Daily’s by gaping down below the support line, same goes with 100k contract chart where it traded right through it overnight. Key levels to watch on the way are 766.5 and major level at 746.50 on the way down. And on the way up 803 is 50% retracement from the highs, if we break above 810 (~61% from the highs) would fully expect to retest the highs.
Pull back was due after such an extended move, and are expecting pullback to at least 770 before resuming higher ultimately reaching 883 ( see Bear Market Magic Fib), while in this wild bearmarket we have to be open to all views, history suggests such scenario.
There are two contradicting outlooks considering bullish outlook on both the dollar and the markets, but charts suggest we could see another short term rally in the Euro regardless of economic conditions:
Euro has reached 50% retracement and put in a doji, which cold be sign of short term trend change. EC also put in first red trend bar which is a warning sign of new starting bearish trend. Pullback before continues move lower is expected over the next several days.
Cheers