Happy New Week Surfers – what’s that whistling noise???? Maybe the sound of the Euro freefalling?
Friday’s action was rather decisive and a clear rebound off the Support/Resistance trendline we had been expecting to be re-tested all last week. After the beautiful buy order we placed with our Swing&Relax Strategy (+71 pips made) last tuesday, the market made it rather clear they didn’t accept the rally of last week and wiped out all the gains, with interest! So strong was the bounce off our trendline, price action broke below the double bottom we spotted at the strong support level @ 1.3033. Though it was “no trade Friday” price action produced a beautiful pre-empting of the crash off our intraday support line from Thursday – more on this in today’s webinar.
Quite clearly now, price is oversold and we are in a “no long, no short” situation. We don’t like to second guess whether this Bear run has come to its end or not, so we await confirmation of either a reversal, or continuation before entering the market. Our pivots will guide us here and currently they are Mixed, yet screaming at us that the market needs pullback. We know this because at 100 pips from the market, the Daily Pivot likes to draw price action a little closer. When the Weekly Pivot joins it (as is the case today), well a powerful magnetic force is created so I’m looking for price action to close ranks with the pivots and head north. That doesn’t mean of course that we immediately place a buy order. That would be like trying to swim up a waterfall. We need the market to cool down (consolidate) and present us with more reasons to enter.
The Day Ahead
Well, we need to exercise our patience and await price action to give us something to play with. Currently, I have no lines to play with at all. We need to await some intraday lines to be created. There’s potential for a resistance line to be confirmed a little later but for now, it’s very much beta. As you would expect after a crash like Friday’s, the market needs to adjust a little so we’ll wait and see what they think. Hotspot today is conditional on the beta trendline being confirmed – we’ll see.
Geoff Pyne | Certified SurfingThePips.com Trader