2021-08-21 Iron Ore 62% - supportBounce of 61.8% retracement. Big bounce interesting level could result in consolidation for a bit
TIO1! trade ideas
Is the bullish move of IRON ORE halted ?First I urge you to look at a weekly candle/bar chart of the commodity. Can you see the strong bearish reversal candle/bar ? This suggests correction in the short term is upon us. To early to forecast the magnitude of this correction which may even turn out to be major trend reversal. More data is required for this. Fact that the price action is at a significant resistance is worth watching our weekly candle/bar charts for further weakness at current levels.
Why bother at current levels with this analyssis ?
Proof is in the pudding(see the published Point and Figure chart and the Bullish Price Objective from the base pattern). This suggests a potential end to the bullish move at current levels which is evident form other chart types.
Correction for now is what I am saying.
Weekly candle/bar charts will offer clearer view in regards to what may be unfolding.
Iron Ore - where to next?Thanks for viewing. This will just be a short one. My reasons for bearishness are:
- bearish RSI divergence (higher price high shown as a lower high on the RSI - at a minimum indicates reduced momentum but normally precedes changes in price direction),
- MACD histogram is trending downward quite steeply,
- MACD moving averages look like they are starting to head towards a cross-over to the downside,
- Declining volume over the past 18 months (seems to average over 400 in May 2019 and is about 120 now),
- A generalised global industrial slowdown.
I may be wrong, or I may be right but just too early, and there may be residual upside remaining. Medium term I see price heading back to ~$40 level.
Protect those funds.
Iron Ore FuturesNoticing: The volume on the Iron Ore China (62% FE Fines) Future always spikes at the start of a new month, declining in the weeks ahead. Coinciding with new orders at month end/start? At current levels, IO remains above it's 8-day EMA but may be vulnerable to a bearish reversal. The RSI is signaling bearish divergence (lower highs) while the MACD has a pending bear cross. Price also becoming extended above the 200-day SMA. Current level: 103.10
Bonus Chart: Iron Ore weaknessIron ore futures is reversing upon a weekly stretched ABCD completion which is confirmed by price action hitting SSR resistance and breaking down below key MA support.
Iron ore prices has been supported largely by supply issues but demand is being tested this trade war. Not sure those highly indebted property developers in China, especially those which have been gouging on USD debt, will be building much in the next year or so.
Iron TopIron started a huge rally since BMFBOVESPA:VALE3 disaster, now that rally is exhausted.
Both Stoch RSI and RSI show a Sell Signal. Price is way overbought and a needs to retrace for a while.
