News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bearish
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
More View more
Real Time News
  • The rising wedge is a popular reversal pattern that is predictive in nature and can give traders a clue to the direction and distance of the next price move. Incorporate the rising wedge in your trading strategy and learn more here: https://t.co/zTTk2WOrj9 https://t.co/q5oBalZieU
  • Both the S&P 500 and $EURUSD will enter the coming week with momentum to their back. What can trip up the rallies? What could keep them going? My overview for the week ahead: https://www.dailyfx.com/forex/video/daily_news_report/2020/12/05/SP-500-and-EURUSD-Rallies-Face-Different-Conviction-Questions-.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/YfEXEhkbhl
  • After the recent strength of EUR/USD, a period of consolidation is likely ahead of two critical meetings: of the European Central Bank and the European Council. Get your $EURUSD market update from @MartinSEssex here:https://t.co/Slu7tHo2a4 https://t.co/9am4szeia1
  • Triangle patterns have three main variations and appear frequently in the forex market. These patterns provide traders with greater insight into future price movement and the possible resumption of the current trend. Learn about triangles here: https://t.co/ZukLITx2KG https://t.co/gvkXqKDQyH
  • Continuation patterns can present favorable entry levels to trade in the direction of the prevailing trend. Use continuation patterns in your technical analysis here: https://t.co/TUVnO3bO1P https://t.co/vBLkMKjf4x
  • Cyclical and non-cyclical stocks can help diversify a trader’s equity portfolio. Get your guide to understanding these stocks here: https://t.co/h7BKTd2J8N https://t.co/n8vpmuLdTW
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here: https://t.co/8A1QhwMVKo https://t.co/CZePv1JEFh
  • The US dollar is unloved, oversold and at lows last seen over 30-months ago. At the moment there seems to be very little reason to buy the greenback. Get your $USD market update from @nickcawley1 here:https://t.co/VY3SLs35cp https://t.co/AVpY2GkGUG
  • The Spinning Top candlestick pattern forms part of the vast Japanese candlestick repertoire with its own distinct features. Gain a better understanding of the spinning top candlestick here: https://t.co/DWm7cBMUg9 https://t.co/IUii5478Jf
  • The Swiss Franc may continue higher against the US Dollar as technical pressure favors USD/CHF bears. .Get your market update from @FxWestwater here:https://t.co/yqJbbhAWiu https://t.co/TCBkQdrMAR
S&P 500 - `Dip-trips' Still in Vogue, But Market Character in Question

S&P 500 - `Dip-trips' Still in Vogue, But Market Character in Question

2016-04-07 09:53:00
Paul Robinson, Strategist
Share:

What’s inside:

  • Support in the S&P 500 held in low 2040s, again
  • Change in character and trend structure off the table for now, but H&S formation still a possibility
  • Diminishing momentum carving out rising channel

Support in low 2040s holds, again

Yesterday, the S&P 500 started the early day session trading down into support around 2042/43, which we deemed important in order to maintain the positive trend structure of higher highs and higher lows. Indeed, the market held onto the low 2040s for a third time in four sessions, further cementing its importance.

Change in character and trend not yet present

From yesterday’s piece:“The next steps the market takes will be important ones in the short-term as all pullbacks to date since the Feb 11 low have been either shallow and/or lasting only a couple of days. If buyers don’t step in here quickly then it will be the first sign of market participants showing a lack of ownership on weakness…”

With support holding the market quickly found buyers, and indeed continued its trend of narrow pullbacks only lasting a couple of days. So far.

The change in character we believed to be just upon us has not yet shown itself. Yesterday, we mentioned the possibility of a ‘head-and-shoulders’ pattern coming to fruition on a rally from support. The S&P could be furthering this possibility today if the turn lower maintains, forming the 'right shoulder'. But we will need to wait for further confirmation first. (Remember: these patterns are not validated until the ‘neck-line’ is broken. In this case the 2042 support level.) If the H&S formation is to play out, then the market should roll over towards the neckline very soon. Today or tomorrow-type soon.

Diminishing momentum carving out rising channnel

The S&P is trading just beneath the critical zone of resistance from 2080 to 2100+, with buyers continuing to step in on each dip. Momentum is not particular strong, though. For example, the low yesterday was roughly the same price the S&P traded at nearly three weeks prior. The diminishing momentum has carved out rising parallels from which traders can use to help shape their trading plans.

A decline back towards the lower line (~2050 at this time) offers a point of entry for those looking to establish a long position, with the low 2040s as the last line of defense for longs. If a lower high forms from Monday’s high (2079), a clean break below 2042 on an hourly closing bar basis would put the H&S into full-swing, and thus giving the shorts strong reason to press on the gas pedal.

On a further advance the Monday peak (2079) and top-side parallel will act as our resistance points of interest. The top-side parallel around 2090 also coincides with a major trend-line off the 2015 peak, adding additional importance and a more meaningful ceiling than the one near 2080. Our interest for establishing shorts on a move into the 2090 region will be piqued. A broadening top could come into play on a move to 2090, more on that if it becomes relevant.

*In either direction, hold times at this juncture have been reduced reduced to a couple of days or less, usually less.

S&P 500 Daily/Hourly

S&P 500 - `Dip-trips' Still in Vogue, But Market Character in Question

Check out our guide, “Traits of Successful Traders” , to learn more about how to better execute your trade ideas.

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX, or email him directly at instructor@dailyfx.com.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES