What a week, eh? And we’ve still got 20% of it left! The market has been full of trickery, however. On Sunday, it gapped higher (red rectangle) and then had two massive lurches – one on Monday, and one on Tuesday. Little did we know at the time………..that would be that. It has pulled a few fast ones here and there (particularly during the pointless Powell blather), but on the whole the wind has been filling bearish sails with hearty gusto.
You surely will note on the chart above that prices, as of this composition, are lilting around the major Fibonacci retracement. Right you are. This is the key decision point with respect to support and resistance. I can only suppose that a combination of earnings reports and Middle East Mayhem will dictate whether we have yet another annoying counter-trend or, my preference, if we fall to the next level lower.
I will say this, however: the weekly chart below shows that the bears regained control three months ago, and we’ve got a nice fat bearish engulfing pattern right now. If we can log one more down day (even a modest one), it will make for a formidable setup going into next week.
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