Whilst prices are expected to open lower, we’re on guard for a small countertrend bounce. A bullish hammer formed on the daily chart at the lower Bollinger band which found support at the 50% retracement level and 200-day EMA. A bullish divergence has formed on the RSI (2) within the overbought zone. A break above yesterday’s high could potentially see it retest the 7275 low, or the monthly pivot point around 7300.
If we managed to bounce that far, we'd then look for signs of weakness for a potential swing trade short, given weak sentiment for global stocks and the tendency for stocks to underperform around this year due to "sell in May and go away" seasonality.
A break of yesterday’s low assumes bearish continuation.
If we managed to bounce that far, we'd then look for signs of weakness for a potential swing trade short, given weak sentiment for global stocks and the tendency for stocks to underperform around this year due to "sell in May and go away" seasonality.
A break of yesterday’s low assumes bearish continuation.
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It was a decent rally, which perfectly reached the resistance zone before pausing ahead of the Australian budget, then pulling back today as it tracked Wall Street lower.
Looking at the lower timeframes, we see the potential for another crack at the 7300 highs (and a soft US inflation report could help with that tomorrow if Wall Street rallies).
Looking at the lower timeframes, we see the potential for another crack at the 7300 highs (and a soft US inflation report could help with that tomorrow if Wall Street rallies).
