Week 4/2016 Summary
Another interesting week behind us, with a twist at the end.
Eur/usd did not give good trade opportunities. It was flat most of the time. It failed to even try to break above the cloud and 1.10 level on a daily chart which I was writing about in last week summary. Now it looks like it is possible it will go down to the lower support line.
The situation for euro is complicated if you check weekly chart:
You can see that eur/usd is near supports from March and April 2015. If this will be an ABCD pattern, then we can see a move down to D point somewhere near 1.0000 level. With a lack of action from buyers in recent days, it is more and more possible.
Gbp/usd is in a strong downtrend, but support at 1.42 hold… for now. You can see that clearly on monthly chart:
The overall trend is still very bearish so, for now, we are probably looking at some correction on gbp/usd.
I like those strong trending conditions because Fibonacci works great on many time frames. I also tend to set my profit targets at higher extensions: 161.8% or even 200% (usually close half at 161.8% and rest at 200%). When I am not sure about trend strength, then I close part of my position at 127% or 138.2%, but in recent weeks I was hunting down the bigger fish.
I mean moves like this:
Oil stopped close to my target at 25$. THe low was at 26.6$ and then we saw a strong correction up. Why this level? From weekly chart on oil you can see that this was 138.2% extension:
It is hard to predict next moves on oil. I think that we may see a correction up to one of Fibonacci retracement lines and then selloff will continue. Situaltion is interesting because oil is moving recently near 20$-30$. Somewhere here we may expect the bottom of move down.
BUnd is in a strong uptrend. I had some very good trades on bund. On weekly chart you can see that bund is near 161.8 high. We will see how bulls will deal with that resistance:
SPX protected support around 1820 points and we saw a stronger bounce up above 1900 points. Weekly SPX:
I am still rather bearish on SPX, but for now this is a place where we may see this correction to continue up.