This week there are 2 Inside days. The first inside day mark the end of the uptrend line. In addition, price action shows a lower high and lower low. This adds to the conviction for a trend reversal as RSI indicate a bearish divergence. The weekly chart also added a bearish engulfing candle which suggest many longs are trapped and many wants out. Weekly chart shows price overshoot above the upper Bollinger Band while the RSI continues to diverge.
The first inside day warrant a sell signal at 124.33 as the RSI indicator added the conviction to short. This is a REVERSAL signal at work.
The second inside day warrant a sell signal only if it breaks and close below 122.36 (assuming this is a CONTINUATION). The risk is support is found at 122.36 which is the 50% Fib retracement and this continuation pattern fail. Take note that prices might consolidate within the range of 122.36 to 124.60 before breaking out.
Assuming continuation pattern then sell once price break and close below 122.36 with stops at 124.70 with the target at 50 DMA. Should AB = CD play out on the daily chart, then 50 DMA looks an ideal place where support can be found.
Good luck.
The first inside day warrant a sell signal at 124.33 as the RSI indicator added the conviction to short. This is a REVERSAL signal at work.
The second inside day warrant a sell signal only if it breaks and close below 122.36 (assuming this is a CONTINUATION). The risk is support is found at 122.36 which is the 50% Fib retracement and this continuation pattern fail. Take note that prices might consolidate within the range of 122.36 to 124.60 before breaking out.
Assuming continuation pattern then sell once price break and close below 122.36 with stops at 124.70 with the target at 50 DMA. Should AB = CD play out on the daily chart, then 50 DMA looks an ideal place where support can be found.
Good luck.