Sive Morten
Special Consultant to the FPA
- Messages
- 18,732
Monthly
So, on monthly chart the one significant event has happened – market by February close has confirmed and finally formed bearish engulfing pattern right at major 50% resistance area. This is very important from technical point of view, because this lets us to stick with this pattern and understand when we can speak about bullish or bearish trend. Thus, until market will not take 1.3730 high – it is difficult to tell about re-establishing of bullish trend. What else we can extract from it? The target – minimum target usually is a length of the bars and it points on 1.2450-1.25 area, although market has not triggered yet engulfing pattern since has not closed yet below its low level.
Still nearest destination is 1.2908 – yearly pivot point, let’s see how market will behave there first.
Weekly
Trend is bearish here, market is not at oversold. On weekly time frame there are two moments that we need to pay attention to. First is, market finally has reached minimum target of engulfing pattern – right at weekly K-support area. The second one is – take a look at harmonic swings. Current move down is much faster than previous one. This tells that market is rather heavier, and may be this is not a retracement already. Another nuance – market has exceeded the length of harmonic swing down. As we’ve discussed many times, it is quite often when market doubles harmonic distance as it breaks it. That’s why, actually this swing calls as “harmonic”. Following to that logic – the destination here is major 5/8 support at oversold – 1.2680 area.
Candles themselves here are rather strong. Market has long upper shadows, trading range of these downward candles is not small and close price stands near the low. In other circumstances this could be treated probably as “3-Black Crows” bearish pattern. Anyway, price action is bearish, trend is bearish. The one barrier here is weekly K-support and we do not see any bounce from it yet, while it should happen in most cases and currently it could happen as well. Hence, we should see some hints on potential pullback on lower time frames first. In any case, it is unsafe to take long-term short position right at Confluence support whatever bearish market is. Besides, new MPP stands significantly higher than current price is, so, market could try to test it before will continue move down.
Daily
Trend is bearish as well as price action, market is not at oversold but very close to it. Anyway, guys, the probability of pullback now is greater than downward continuation. Price stands at weekly K-support that is also an Agreement with daily 1.618 AB-CD target, slightly lower stands a yearly pivot. So, if any bounce will follow, market should start to form a pattern that could trigger it somewhere around current area. Yesterday market has failed with our stop grabber on 4-hour chart and continue move down. Price has reached 1.27 extension of previous retracement up. Interesting, that 1.618 extension of retracement stands precisely at the major support area. So, our main task for the beginning of the week – keep eyes open and catch any reversal pattern on daily chart that could appear in this area.
4-hour
Well, may be we can get something of that sort – bullish wedge that is accompanied by divergence and simultaneously could be a 3-Drive Buy pattern. Although I prefer to get patterns on daily chart, when I dealing with weekly support, but currently that is all that we have. Divergence is also relative, since MACD is still bearish, but on hourly time divergence is already in place. On hourly chart the overall action could be drawn as butterfly “Buy” as well. So, although currently we do not have very strong and obvious patterns as H&S or clear Butterfly, this still could work. May be, when this wedge will start to work, we will get some patterns on daily frame as well.
Conclusion:
On a big picture we could get the move even to 1.25 area, but now market stands at Weekly K-support and Agreement, new MPP has not been tested yet, and probability of upward bounce is solid.
Anyway before pull the trigger we need pattern on lower time frames that will allow us to do this, but currently all that we have is just a bullish wedge that is developing on 4-hour time frame. I hope that later we will get some pattern on daily time frame either. Anyway currently we have to keep an eye on this action. Market should show another small leg down and touch yearly pivot and daily 1.618 target. That will be our first potential point to enter short-term long trade.
The technical portion of Sive's analysis owes a great deal to Joe DiNapoli's methods, and uses a number of Joe's proprietary indicators. Please note that Sive's analysis is his own view of the market and is not endorsed by Joe DiNapoli or any related companies.
So, on monthly chart the one significant event has happened – market by February close has confirmed and finally formed bearish engulfing pattern right at major 50% resistance area. This is very important from technical point of view, because this lets us to stick with this pattern and understand when we can speak about bullish or bearish trend. Thus, until market will not take 1.3730 high – it is difficult to tell about re-establishing of bullish trend. What else we can extract from it? The target – minimum target usually is a length of the bars and it points on 1.2450-1.25 area, although market has not triggered yet engulfing pattern since has not closed yet below its low level.
Still nearest destination is 1.2908 – yearly pivot point, let’s see how market will behave there first.
Weekly
Trend is bearish here, market is not at oversold. On weekly time frame there are two moments that we need to pay attention to. First is, market finally has reached minimum target of engulfing pattern – right at weekly K-support area. The second one is – take a look at harmonic swings. Current move down is much faster than previous one. This tells that market is rather heavier, and may be this is not a retracement already. Another nuance – market has exceeded the length of harmonic swing down. As we’ve discussed many times, it is quite often when market doubles harmonic distance as it breaks it. That’s why, actually this swing calls as “harmonic”. Following to that logic – the destination here is major 5/8 support at oversold – 1.2680 area.
Candles themselves here are rather strong. Market has long upper shadows, trading range of these downward candles is not small and close price stands near the low. In other circumstances this could be treated probably as “3-Black Crows” bearish pattern. Anyway, price action is bearish, trend is bearish. The one barrier here is weekly K-support and we do not see any bounce from it yet, while it should happen in most cases and currently it could happen as well. Hence, we should see some hints on potential pullback on lower time frames first. In any case, it is unsafe to take long-term short position right at Confluence support whatever bearish market is. Besides, new MPP stands significantly higher than current price is, so, market could try to test it before will continue move down.
Daily
Trend is bearish as well as price action, market is not at oversold but very close to it. Anyway, guys, the probability of pullback now is greater than downward continuation. Price stands at weekly K-support that is also an Agreement with daily 1.618 AB-CD target, slightly lower stands a yearly pivot. So, if any bounce will follow, market should start to form a pattern that could trigger it somewhere around current area. Yesterday market has failed with our stop grabber on 4-hour chart and continue move down. Price has reached 1.27 extension of previous retracement up. Interesting, that 1.618 extension of retracement stands precisely at the major support area. So, our main task for the beginning of the week – keep eyes open and catch any reversal pattern on daily chart that could appear in this area.
4-hour
Well, may be we can get something of that sort – bullish wedge that is accompanied by divergence and simultaneously could be a 3-Drive Buy pattern. Although I prefer to get patterns on daily chart, when I dealing with weekly support, but currently that is all that we have. Divergence is also relative, since MACD is still bearish, but on hourly time divergence is already in place. On hourly chart the overall action could be drawn as butterfly “Buy” as well. So, although currently we do not have very strong and obvious patterns as H&S or clear Butterfly, this still could work. May be, when this wedge will start to work, we will get some patterns on daily frame as well.
Conclusion:
On a big picture we could get the move even to 1.25 area, but now market stands at Weekly K-support and Agreement, new MPP has not been tested yet, and probability of upward bounce is solid.
Anyway before pull the trigger we need pattern on lower time frames that will allow us to do this, but currently all that we have is just a bullish wedge that is developing on 4-hour time frame. I hope that later we will get some pattern on daily time frame either. Anyway currently we have to keep an eye on this action. Market should show another small leg down and touch yearly pivot and daily 1.618 target. That will be our first potential point to enter short-term long trade.
The technical portion of Sive's analysis owes a great deal to Joe DiNapoli's methods, and uses a number of Joe's proprietary indicators. Please note that Sive's analysis is his own view of the market and is not endorsed by Joe DiNapoli or any related companies.
