The targets of the previous analysis have been “reached”, but the movement is probably still not over yet. Even though we have dropped quite a bit already since the 4250 high of the weekend. There is simply just no panic selling or any high to be seen yet. Only at the break of the 3800 support (where price had found some support several times) caused some selling to happen. But as we can see on the left, all the movement is still inside that channel. So it’s like slowly making new lows, almost like it is being controlled.
One thing is clear, there is not a lot of buying going on the past days, since the is on the lower side. But we can also say that selling might be drying up. I can’t say which one it is, but i think it’s the last one.
I think it’s safe to say, that mid-term buyers who might have bought around the 3500/3900 the past 2 weeks, are not selling while we are still above the 3500/3600 . As i mentioned several times lately, i don’t think that zone will be an easy one to break. I think the channel on the left is actually a translation of this possible fact. For the ones who don’t understand WHY we see an acceleration when certain support levels break, this is it. The 3500/3600 is such an obvious , that it becomes an easy buy and/or hold when we stay above that level. Just like we saw at the 6100/6200 zone. Everyone who was buying that zone, was selling like crazy when it eventually broke. This 3500 level is of course no where near as strong as the 6100 level, but it will still cause a lot of stops to trigger if the support breaks.
What games do whales love to play? That is making false breakouts. What i am trying to show with the red line. To be clear, i am not saying this will happen, but if we see that support line of the channel break, we will probably see an acceleration down which will also probably break the 3500/3600 . If we see a lot of panic selling happening but see some accumulation/buying going on as well at a certain level (my best guess is around 3200/3300) and start to see the forming of a V shape low. This scenario is just so genius and i know most people don’t even know what is really going on when that happens. Too much to get in to right now, but i will try to make an educational post about it soon.
Back to business, for the short we are still moving inside this small between 3670/3750. We should have dropped 4 hours ago but out of nowhere a lot of buying power stepped in the market and saved the from breaking. This increases the chance for a Bart move, so be aware of this. I can’t say yet which one it is, but the longer it takes the higher the chances for a Bart move. If this Bart move does happen, it will probably break the 3800 and move towards the 3900ish. If this Bart move happens, it could mean we will move to the upside again of this channel. If we don’t see a squeeze happen, the 3800 will be a heavy for the short term and a key level between very movement or more slow and steady movement as this channel suggests.
So in summary:
– The red line is an assumption, being prepared in case the channel breaks, we make a big drop but start to see a lot of buying that pushes the price back in the channel again. This
scenario suggest a mid-term low, maybe even a long term low if we see a big rally happening.
– Same as the red line, but we don’t see a big bounce at the low and stay below the 3500/3600, maybe even making a bigger flag. This would be very and we need to judge things again at that moment.
– A Bart move, if that is the case, we will probably move 6/12 hours like this and see a short squeeze above the 3900ish. If we see a bull flag-ish forming around that level, i think a short term low is set. A break of the channel is obviously important as well, but i think the 4050/4100 is the key level for now. I think a break of this level could give us much more upwards movement. If we see that happening, we would even have a potential big on the daily. The 4400 (previous high) is obviously an important level as well. But for me to become more bull than bear, the 4600ish will be the level to break. On the long term, anything below 4600 is still very .
So no clear path at this moment, since the has been turned into a possible Bart move. Since this extended has made things much more difficult to judge. As long as we don’t see rallies of 150+ points, it will remain very .
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Previous analysis:
Published at Thu, 06 Dec 2018 03:05:32 +0000
