Corrective rallies look to be complete as uptrends are decisively breached.
Medium- to long-term downtrend structures are still intact with the past month’s strong recovery considered to have been poorly based corrective action only. This short-term upward cycle looks to have now run its course with prices looking vulnerable to a retest of initially 4,730/50 in the coming sessions, which, if decisively breached, would signal a possible fresh challenge of the March lows in and around 4,370/90 where better demand should then be stimulated. Any further near-term rally attempts should now be restricted by strong overhead resistances waiting at initially 5,120/40 then again towards 5,230/50.
Trading strategy: Holding shorts established on break of uptrends looking for 4,740 initially, and even 4,400.
Overall bearish patterns remain firmly in force with recent recovery attempts considered to have been unsustainable corrective action only. Preliminary indications suggest this to have now run its course with a further challenge of the historically important 1,430/50 area now likely in the coming days. Good support should again be stimulated in this region with only a clear and sustained break beneath here likely to trigger more serious losses and set up a test of the 1,380/90 zone. However, continued success in holding here would encourage the possibility of a bottom being established.
Trading strategy: Having secured profits on shorts, prefer to await results of the fresh test of historic supports ahead of re-entering.
The medium- to long-term downtrend structure remains firmly in force with the past month’s strong recovery considered to have been corrective action only. Preliminary technical studies now suggest this short-term upward cycle to now be complete with prices vulnerable to renewed bouts of weakness in the days ahead. While local support should be encountered at 1,880/90 initially, a clear and sustained break beneath here would signal acceleration towards the area of the March lows in and around 1,760/70 where better demand should then be uncovered. Resistance remains in place at 1,970/80 then 2,050/70.
Trading strategy: Looking to re-establish shorts on bounces, looking for a retest of the 1,770 area.
Intermediate- to long-term technical studies remain clearly negative with lower targets still possible, though interim objectives have been fulfilled with a fresh period of correction and reconsolidation now developing. However, strong resistance continues to be encountered on approach to the 1,750/60 area with prices once more appearing vulnerable to renewed bouts of weakness. Local support in the 1,630/40 area could come under fresh examination, which, if decisively breached, would regenerate downward momentum and set up a retest of the important 1,570/80 region where better demand should be met.
Trading strategy: Continuing to utilize corrective rebounds to probe the short side.
The overall bearish outlook remains firmly in force with little evidence of any bottom to this major downward cycle yet, though short-term trends have turned up with a period of corrective action being experienced. However, strong overhead resistances waiting at 12,900/13,000 initially, then 13,400/13,500 should cap gains and unless this upper boundary can be decisively breached this market appears increasingly vulnerable to renewed bouts of weakness in the days and weeks ahead. Nearby support should now be anticipated at 11,400/11,500 initially, then again towards 10,800/10,900.
Trading strategy: Monitoring the current corrective bounce for opportunity to re-establish shorts.
While overall technical studies remain decisively bearish with little evidence of a bottom to this major downward cycle yet, prices look to have uncovered good support on approach to the historically important 13,000/13,100 area with much-needed corrective action being experienced now. However, in the absence of any significant basing activity, recovery attempts are likely to prove unsustainable at this stage with strong resistance anticipated at 15,500/15,600 initially, then again towards the 17,000/17,100 region with prices remaining vulnerable to renewed bouts of weakness. Support now at 14,000/14,100.
Trading strategy: With profits on shorts secured, monitoring current correction ahead of re-establishing.
Medium- to long-term bullish patterns remain firmly in force and while prevailing high levels of volatility suggest deep corrective action is likely to be an ongoing characteristic, prices are expected to trend closer to the 1,800.0 region in the weeks ahead. Interim resistance should again be encountered in and around the 1,745.0/50.0 area and near-term pullbacks should now uncover good support starting in the 1,640.0/45.0 zone. Only a clear and sustained break beneath here would trigger more serious near-term falls and set up a fresh challenge of the more important 1,600.0/05. Levels where better demand should be stimulated.
Trading strategy: Would once again look to probe the long side on corrective dips looking for 1,800.0 region.
The overall technical outlook remains clearly bearish with lower targets still readable in the weeks ahead though interim objectives in and around the 11.20/40 area have been fulfilled with sharp corrective action being experienced at present. However, this appears poorly based and hence unlikely to prove sustainable at this stage with strong overhead resistances waiting at 16.00/20 initially, then on approach to the 16.80/17.00 zone. Unless this upper boundary can be regained, prices remain vulnerable to renewed bouts of weakness with support now waiting at 14.50/70 initially, then 13.70/90.
Trading strategy: Monitoring current sharp corrective bounce for an opportunity to re-establish shorts.
The data shown and the views expressed on this sheet are for information purposes only and do not constitute recommendations to trade. Cliff Green Consultancy does not accept any liability for loss or damage suffered through any actions taken or not taken as a result of reading any information provided herein.
Wednesday, April 22, 2020 | Tel: + 44 (0)7710369208 | www.cliffgreenconsultancy.com | email: firstname.lastname@example.org