Further buying expected in the US equity market, traders...
US equities extended gains on Tuesday, punching to highs of 25649. A lack of fresh headlines on trade conflict allowed investors to remain focused on upbeat earnings figures.
As a result of yesterday’s move north the July 27 high at 25559 was engulfed, forcing the H4 candles into supply territory at 25685-25535. While this H4 supply will likely be no ‘walkover’, higher-timeframe structure is pointing to a possible continuation to the upside. Weekly price recently retested trend line resistance-turned support (etched from the high 25807) in the shape of a reasonably nice-looking bullish pin-bar formation. From this point, a run up to supply coming in at 26670-26042 is a possible scenario to keep tabs on this week. Daily supply at 25571-25383, as you can see, was also engulfed on Tuesday (now acting support area), opening up a possible run towards another layer of supply coming in at 26297-26028 (seen within the walls of the aforementioned weekly supply).
Areas of consideration:
With both weekly and daily action indicating additional bullish sentiment, entering short from the current H4 supply is a chancy move, in our humble opinion.
Technically speaking, waiting for H4 price to CLOSE above the current supply zone before considering longs in this market remains a logical route. A retest to the top edge of this zone that holds firm will likely be enough to draw in buyers and bring the unit towards the aforesaid weekly supply, and therefore remains a viable long setup to keep eyes on going forward.
As a result of yesterday’s move north the July 27 high at 25559 was engulfed, forcing the H4 candles into supply territory at 25685-25535. While this H4 supply will likely be no ‘walkover’, higher-timeframe structure is pointing to a possible continuation to the upside. Weekly price recently retested trend line resistance-turned support (etched from the high 25807) in the shape of a reasonably nice-looking bullish pin-bar formation. From this point, a run up to supply coming in at 26670-26042 is a possible scenario to keep tabs on this week. Daily supply at 25571-25383, as you can see, was also engulfed on Tuesday (now acting support area), opening up a possible run towards another layer of supply coming in at 26297-26028 (seen within the walls of the aforementioned weekly supply).
Areas of consideration:
With both weekly and daily action indicating additional bullish sentiment, entering short from the current H4 supply is a chancy move, in our humble opinion.
Technically speaking, waiting for H4 price to CLOSE above the current supply zone before considering longs in this market remains a logical route. A retest to the top edge of this zone that holds firm will likely be enough to draw in buyers and bring the unit towards the aforesaid weekly supply, and therefore remains a viable long setup to keep eyes on going forward.
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