Back test of the neckline and rejection has accelerated the downside move on Friday. Sell side in firm control so far. The H&S formation at the end of the upside move and its unfolding suggests further decline to come.
There is some sign of dip buyers lurking at the 50% ret. They even managed to close above S1. This is a mechanical reaction of the Algos so far. Larger timeframe patterns are slow in nature. It takes time to unfold. This is the current context.
What to expect short term. Potential retest of the low and breaching it. A quarterly R1, now support, may attract short covering, dip buyers on first test. A reaction could be enough to run again back to the broken neckline. The dream of the Xmas rally die hard.
The options market defined the following range for the next week: 15120-16220. This is a big range.
Trading in high volatility environment is not for everyone. But micro futures could be used instead.
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