The Dust Settles
Today, we prepared for You a cross market analysis, where we will analyze one index, commodity and forex pair. Thursday starts with a cooldown on the major instruments. The volatility is decreasing and the initial shock is gone. Now, time to estimate the damage and think about the direction for thee next few days and weeks.
We start with the Oil, which was rocked by the sharp decline in the global demand – from China in particular. Oil managed to break the horizontal support on he 51 USD/bbl and the lower line of a bigger symmetric triangle pattern. In theory, that triggered the long-term sell signal on the black gold. Buyers have their last stronghold though and it is the 43 USD/bbl. Breakout of this support, will be the ultimate confirmation of a bearish sentiment.
Now Dax, which is creating a nice bullish reversal pattern. It does not mean that the upswing will happen for sure. One thing missing is the breakout of the neckline – 12222 points. As long, as we stay below, sellers still have bigger chances for a success.
Last instrument is traders’ beloved GBPJPY. Here, the price was drawing a bearish formation of a descending triangle. Sellers failed to break its lower line though, which can be considered as a positive sign. Instead of breaking the support of this formation, the price broke its resistance. As long, as we stay above the green horizontal support – the sentiment is positive.
This article was originally posted on FX Empire
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