Weekly Price Action & Technical Analysis Setups

For the third time now the Euro has failed to close above the 1.34 figure in the last 3 months on 3 attempts. The pair last week sold off for 4 days, only to stop on the daily 20ema that we talked about in last weeks technical analysis market commentary, then bounce ~130 pips higher. Short term the range between 1.3190 and 1.3399 is the spoken word. Bulls still have the upper hand, but will need to take out 1.34 to entice more bulls to come in (otherwise the range will take precedence). Bears can look for intraday price action signals to sell at 1.34, while bulls can look towards 1.3190 to get long. A daily close on either side of these fences will suggest the next medium term direction.

US DOW Index – Turning Bearish
After failing to maintain the air above the prior swing highs at 15400, the Dow has sold off massively last week, dropping over +330 pts. The US index is continually showing signs of a likely bearish reversal in play, treating the daily 20ema as resistance 3x then selling off, suggesting the bears used this as a springboard to create further downside.

I’ll look to sell any rotations back into 15300 as I suspect one more bounce will ensue which will result in an LH (lower high) and the final coup de grace for a major bearish reversal. Any daily closes above 15400 will have to take out the 15600 highs to convince the market the bulls are still in control. But the formation of an LH around 15400 and follow up selling will suggest a major market reversal is in play, and the bears have taken control. Downside levels to watch are 14878 and 14600.

Spot Silver – Impressive 8 day Bull Run
In the last three years there have only been four 8 day bull runs, but not one that went for 9 days, so we are in some impressive territory here. We have been bullish on PM’s for over a month, which you can read about here, here and here, and they have not disappointed taking critical key levels last week. I’m expecting this all to be a part of a multi-week bull run, likely lasting till end of Sept, or early October.

I’ll look at pullbacks as opportunities to add to my current position from $19.45, and will consider buying at 22 and 21.35. Only a daily break and close below 20.60 will negate my medium term bullish bias. Upside levels are 24.55 and 26.63 medium term.

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