News & Analysis
Eightcap CFD technical insights; Recovery under pressure? 22/02/18
Traders, so far this week we’ve seen stock indices declining. It’s been across the board apart from the AUS200 that has made a new weekly high adding 75 points. In Europe and in the US it’s been a very different story. The GER30 and UK100 have lost over 100 points since Monday’s open. The US30 has lost 600 points to this stage in the week. Are we seeing a quite seller build up? Are we going to see indices fall further to put in correction low test? Analysts have been discussing this low test. Many thinking we need a low test could confirm the correction has ended, others advising this could be the beginning of a bear market. Either way a return and hold at the low or a fail to reach the low will start to clear up bear market ideas.
In the meantime, sellers have had control on most indices this week, are we seeing to recovery starting to fail?
US30, sellers got going on Monday and basically haven’t let up. Pre-FOMC minutes we did see a rally that failed setting up yesterday’s 165 points lower close. We can see the short term trend-line has been broken. We can see two clear low targets sellers could test if momentum stay’s in their favour. The 2nd could be constituted as a low test.
GER30 has held up a lot better than the US30. Buyers have failed on four attempts to close above 12,505 locking this level in as resistance. The recovery trend-line is starting to break. If sellers can expand we see two levels below that could be reached. The 2nd low being in our eyes, a low test. To start thinking bear market sellers would need to take price back to lower support zone and break it. That would start to paint a very different picture!
Good Trading from Eightcap.
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