Last session was a very interesting one. Although the market turned down and every one expected that the top was in, buyers were strong enough to push prices to new intraday highs. A bullish wave count as depicted in the 10m chart has a 5 wave move completed from 1325 lows. There is however an important drawback in this count. Wave ii is far too small both in time and price relative to the same degree wave iv.
So here comes the bearish count that I favor for the time being. 5 waves down completed and followed by a 3 wave correction. First confirmation that this count is correct will be the breaking of 1345. Next support that should break is the blue trend line and the 1325 level. As mentioned many times in previous posts 1310 is very important support level. Bears know that 1375 is the closest stop price level they can use or if they want to be patient, they can wait until a support level is broken. The textbook stop for bears would only be 1422. Bulls on the other hand could use 1310 as a stop in my opinion. The overlapping rise since early June doesn't work in their favor.
No comments:
Post a Comment