The first thing I noticed about the charts when I opened them to begin this week’s analysis, was the doji on the Weekly chart. It really did seem to me that last week was definitely a bear victory. I guess it seems that every day is a bearish day lately!! If nothing else, it demonstrates the importance of using the bigger timeframes when starting your analysis – if only to get a feel for where the market lies.
The market is still suspended inside the bearish channel of course but there are definite signs of a bullish fightback. Firstly, we had the double bottom on H4 last Wed/Thurs and although we have seen a lower low since, it’s not too far to the south and price continues to pull away from the bottom of the bearish channel. Not enough to put my sentiment in bullish mode to be honest, but maybe a bottom is at least possible!!
The fact remains that the pivots and channel are telling us that the bears are still in control so any thoughts of entering long must be very controlled. Asia session has seen a near vertical pullback of over 100 pips and we are at DR-3 so this rules out an entry long in any case. So we must await consolidation now & look for pullback to the South (haven’t said that for a while). We have 2 clear hot spots and considering where price action has gone during Asia, a shark short off the resistance trendline would be plan A.
As always – we sit on the beach and wait till the surf’s up (hot spots are hit).
Have a great day.
Geoff | Certified SurfinThePips.com Trader