Good Evening and I hope you are well.
comment: Bears get nothing going. Everything is bought. This notion slightly changed today. We saw an increase in selling pressure and market made a decent lower high but problem for the bears is, the bull trend line held and so far we have only seen big tails below 21100. We have formed a triangle and we could see a bigger trend day tomorrow. Until the trend line breaks, I don’t think bigger shorts make sense.
current market cycle: trading range
key levels: 21000 - 22000
bull case: Bulls defended the trend line and if bears step aside enough, we could do a new ath over the next 2 weeks. For now they are buying the dips but are too weak to push for new highs. Still most arguments are on their side as long as we are in this clear channel.
Invalidation is below 20800.
bear case: Bears need a weekly close below 20800. What are the odds of that happening? Meh. Betting on a trend line break is almost never a good strategy. It needs to happen and you have to follow. So if bears can get a strong move and consecutive 1h bars below 20900, it would increase the odds greatly of more downside. Bears still have many problems given the daily chart. The gap down is to 20300 and the daily 20ema is around 20600. So even if we break the trend line, I doubt bears will just melt through the daily ema after such a squeeze.
Invalidation is above 21600.
short term: Neutral. For now I expect more chop until one side clearly gives up again and if I had to guess, bears are more likely to step aside since we have big obvious targets above and the trend line is still valid.
medium-long term - Update from 2024-04-20: My most bearish target for 2025 was 17500ish, given in my year-end special. We are +18% from the lows and I do think, once this turns again, it will easily be the short trade of the year.
trade of the day: Buy low, sell high and scalp. 21400 - 21460 was the main range and both sides made money today. Only real bad trade was shorting below 21400 or buying the Globex high.
comment: Bears get nothing going. Everything is bought. This notion slightly changed today. We saw an increase in selling pressure and market made a decent lower high but problem for the bears is, the bull trend line held and so far we have only seen big tails below 21100. We have formed a triangle and we could see a bigger trend day tomorrow. Until the trend line breaks, I don’t think bigger shorts make sense.
current market cycle: trading range
key levels: 21000 - 22000
bull case: Bulls defended the trend line and if bears step aside enough, we could do a new ath over the next 2 weeks. For now they are buying the dips but are too weak to push for new highs. Still most arguments are on their side as long as we are in this clear channel.
Invalidation is below 20800.
bear case: Bears need a weekly close below 20800. What are the odds of that happening? Meh. Betting on a trend line break is almost never a good strategy. It needs to happen and you have to follow. So if bears can get a strong move and consecutive 1h bars below 20900, it would increase the odds greatly of more downside. Bears still have many problems given the daily chart. The gap down is to 20300 and the daily 20ema is around 20600. So even if we break the trend line, I doubt bears will just melt through the daily ema after such a squeeze.
Invalidation is above 21600.
short term: Neutral. For now I expect more chop until one side clearly gives up again and if I had to guess, bears are more likely to step aside since we have big obvious targets above and the trend line is still valid.
medium-long term - Update from 2024-04-20: My most bearish target for 2025 was 17500ish, given in my year-end special. We are +18% from the lows and I do think, once this turns again, it will easily be the short trade of the year.
trade of the day: Buy low, sell high and scalp. 21400 - 21460 was the main range and both sides made money today. Only real bad trade was shorting below 21400 or buying the Globex high.
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Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.