I'm on holiday for a couple of days and I didn't think I'd have an
internet connection but it turns out that I do, so I caught some of the
action today and saw something that looked interesting enough to be
worth posting.
I've been looking for a decline channel or pattern forming from the top,
and at the moment I'm not seeing much other than the very large
patterns I've posted previously. However I have noticed a very
significant looking decline trendline that has been considerably
strengthened by action in the last few days, and it is the blue
trendline on this ES 60min chart:
At no stage in the last few weeks have we broken away in either
direction from this trendline for more than two or three days, which makes it well worth noting, and we closed on it tonight.
We could be making a short term bottom here. There's definite positive
divergence on RSI and MACD on the hourly chart as I've marked, and it
may well be that we bounce here. If we break through that trendline
overnight though, then the path is open to go considerably lower this
week before returning to the trendline again by the end of the week.
EURUSD is also showing some positive divergence, having come very close
to the lower trendline of the six month old broadening descending wedge
on Sunday night:
Looking through the other USD currency pairs nothing much sprang to the
eye in the short term except for a very steep declining channel on
AUDUSD. It is so steep that I was wondering how long it could last, but
I'll be watching it carefully as on a conviction break of 80, I have my
next target for AUDUSD under 70, and a longer term rising wedge target
of 62.5:
