Thursday, 4 July 2013

Here we go

US markets are closed today but the after market S&P CFD is still in action. The orange channel is broken upwards on the 4th hit which I have mentioned in yesterday's post. The red support will be tested for the second time and I'm inclining towards a break up and new all time highs next week or after that.
Euro bounced back down from the upper band of the red declining channel. This is the 3rd hit I was talking about in yesterday's post. The 4th hit may break it as this is already a very steep channel. Unless it turns up and break this channel soon, the channel lower band target is around 1.27. Breaking up this channel would open prices towards 1.38.
Cable's action today was still text book channel analysis which was a confirmation of yesterday's post. The green channel's upper band was hit and the bounce back was very strong which broke down the blue ascending channel. However, it is hard to call that a channel due to its very low slope. Therefore, I suspect that this entire action may turn to be a rectangle which I showed in red. The internal resistances of this hypothetical rectangle are also shown with two red lines. If that is a rectangle we should ultimately see a bounce around the bottom edge at 1.4827. On the other hand, if the blue channel was a bear flag we should see quotes below 1.48 soon. I'm expecting a bounce after hitting the green channel's lower band.

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