Monday, November 02, 2009

Weekly Report - Nov 2nd to 6th '09

ES not only turned south again on Friday as expected, but it went straight back to previous lows and further down to strong support level. End of month window dressing probably also caused additional volatility to the market.
The market is obviously bearish and the next breakout (a short term bounce is possible on Monday though) will take prices to the next price segment, with a target area around October lows (next stall level also).
Note that picking the right time frame is not as easy as it looks, and a 30mins time frame can help determine turning points.
TF is also on a strong support on 562. In fact the current configuration is very very similar to ES. A bounce is also possible here but TF is likely to test high 540s and could even reach low 530s later on. It should however not aim back straight at low 510s (weekly) without testing 560 as a resistance, but we'l review this scenario in due course.

EURUSD: We've seen clear swings with a drop on strong resistance down to strong support. Does that mean that the US$ will fall again? Probably not. The MTFS crossover is not indicative of a sustainable turnaround. We'll therefore check for the next Fib level for resistance.
On the Daily chart, selling pressure is still there, so the current support on the 60mins chart will be tested again, and probably lower to around 1.464 .
No change in our longer term outlook.

( posted 6:15 AM UK )