Good morning traders. Yesterday in the article we discussed an unusual volume profile. It was a double distribution day with a large low volume zone in the middle. Well, that area was not tested and instead we completed a fifth consecutive day of lower lows and lower highs on the daily chart.
Yesterday also pierced below the major October low, however only by a point or two. The question is whether this will be the formation of a double bottom or does today provide continuation of this down trend. We will know more tomorrow.
If we consider that the current price action including the gap this morning is a retracement, where will we go? The most obvious target would be a retracement back towards 11220. This is the underside of the previous lows. And this is also approximately half the way back up the previous swing length.
The previous minor swing was around 400 points, we have already retraced 140 and are currently trading around 11,140.
The retracement target that we discussed above would also be the exposed point of control from Friday. The price action missed this point of control yesterday, leaving it exposed/naked. Today we have opened up above the value area and have yet to break the value very high of 11,126. If we break a load this value area high, the point of control is that 11,072 at the bottom of the gap. This would be another option.
Yesterday we started below the value area as well and it failed to break inside around midday. So let’s see how the attempt goes this morning.
Oil plunges over supply cut fears. Interpol elects Kim Jong Yang as president. Salvini might be ready for budget changes. Trump wants oil prices and Fed rates lower. Apple shares drag Dow 600pts in the red. Trump says S. Arabia to remain partner despite Khashoggi murder. Deutsche Bank estimates $150B of suspicious Danske assets.
|Point of Control :||11103||6961||24505||3114|
|Value Area High :||11126||6973||24707||3129|
|Value Area Low :||11055||6936||24391||3109|
|Camarilla Breakout (Bull)||11172||6987||24797||3140|
|Camarilla Breakout (Bear)||10962||6870||24061||3082|