Price stalled at the 62% Fib retracement of yesterday's range and the bears ambushed. Initially, the PDL held as support, but after the midday doldrums, the bears came back in pursuit, pushing price beyond yesterday's gap fill. We came back for a retest of morning support and it held as resistance, forming a bear flag, which broke into the close.
As depicted below, bulls are trapped and need to hold the 61.8% Fib retracement of the last leg up, if it doesn't give way overnight.
2 comments:
Interesting charts Jamie. Whilst studying them they reminded me of something I'd traded a while back on an FX pair that looked like this:
http://www.indexswingtrading.com/wp-content/uploads/2011/10/AUD-CHF-triangle-breakdown-10th-June-2011.jpg
Ok, that's a weekly chart and I'm actually comparing it against an hourly chart, but the patterns are the same as the Indices, with DOW showing the most similarities:
http://www.indexswingtrading.com/wp-content/uploads/2011/10/DOW-Hourly-descending-Triangle-2nd-Oct-2011.jpg
....And this is how that first FX chart eventually panned out:
http://www.indexswingtrading.com/wp-content/uploads/2011/10/AUD-CHF-weekly-8th-Aug-2011.jpg
I reckon it's gonna be an interesting week.
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