ES reversed abruptly on 1300 (Fib) on Friday, to no surprise after repeated words of caution over the last reports. I admittedly did not update on Twitter to focus more on TF and EURUSD (sorry). ES swang back to near (1H) range lows where it should land for a while (mid to high 1260s), as a test of (4H+/D) resilience and overall volatility, before eventually aiming at 1250.
TF to which we pay more attention also reversed on Friday morning. A Twitter post anticipated direction if not the volatility which came with it. TF is also now aiming to low 770s without quite reaching our 771 target before the close, maintained for early Monday. 773 is indeed a (1H-) support which impacted selling pressure late in the day. (4H) range lows may also force the market to pause a bit, lower targets can be set already (765?, then 756) as soon as we’ve seen how TF behaves on 771. As mentioned in recent reports, the market needs to cool down, probably on (D) resilience level near 756, although a high volatility could make TF venture to 750 by mid week.
EURUSD also tilted and slid almost on a straight line on our Kase charts to even pass our 1.362 target. It ended the week on (1H-) stall level near 1.358 where it should come back and try to settle for a while. A strong support is visible on 1.355-1.356. It is in a way reassuring as a resistance breakout would have generated very substantial buying to above 1.39. We note however that the bull trend is still quite valid on (4H+), subject to resilience level (incidently also 1.355) holding of course. We can’t discard deeper retracement to 1.342, so we will monitor the market very closely over the next day or two.
T-Bond Fut. (US): a little volatile and messy on (4H-), and boring on congested (D). The same outlook prevails with a recovery pattern lining up, to be probably confirmed upon a breakout of current range. Energy is certainly not there to support strong buying, but this would help US aim back to 125. At this point in time, it is difficult to predict how long this congestion will last, or even whether a firmer test of range lows is needed.
( Posted Sat AM UK ) – Twitter updates on Monday
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