ES fell as expected, but faster and lower than anticipated. Long time readers of this report will have noted the quantum behaviour of ES (and many other markets), with prices often finding equilibrium on equi-distant levels (32 points for hourly ES for a long time). ES could have stalled in the high 1060s but selling pressure was just too strong, so stall level held for a few hours, to see prices finally settle on low 1060s.
ES is therefore now in bounce territory but the retracement potential looks limited at this point in time (5:30 AM UK). We’ll check later on today on a 30mins chart or lower whether Fib levels can be reached.
Note however that we are entering a dangerous breakout area on weekly/monthly chart which could send prices a lot lower (1000, then 850!)
TF follows the same path, but didn’t even bother about the 594 level to aim straight at the Fib level on 588. It is quite bearish still in the short term though and like ES we are on the brink of channel breakout on the weekly chart so the last few days will be crucial for the next few months if not for the rest of the year…
EURUSD: The Euro fell to our target on 1.375 and even lower. The support level on intraday time frames is indeed on 1.367 which was hit spot on yesterday. I admit i underestimated the disturbing impact of volatility here. While this new support level should hold for a while, the selling pressure is here also very very strong still, so there is no upward retracement potential at this point, and at best some stabilisation around current lows.
( Posted 6 AM UK )
