Article 50 day...
Article 50 was signed (in the Asian session actually) and hand delivered. The PM has talked about it and we will hear comment after comment today.
In the process,the price fell at first, recovered and is now moving back lower in early NY trading. While on its runs, the price has moved:
- below the 100 day MA at 1.2417 on its way to test the 200 bar MA on the 4-hour chart at 1.2379.
- In the European session it went back above that 100 day MA line and tested the 200 hour MA (green line in the chart above at 1.2465). It rejected the attempt above that line.
- We are currently testing that key 100 day MA once again.
The up and down price action above and below the key 100 day MA and the sellers above and buyers below against other MA levels, suggest that traders are unsure and just trading the ranges. The 100 day MA is a pivot (PS. the 38.2% is also near the 100 day MA).
What to do?
If you like the sell side, lean against the 200 hour MA or trade a break back below the 100 day MA. You will want to see that 200 bar MA on the 4-hour at 1.2379 eventually broken (then the 50% at 1.23617 and the 100 bar MA on the 4-hour at 1.2336.
If the short squeeze gets going, a second move above the 200 hour MA at 1.2465 might be the technical clue to see. The 100 hour MA at 1.2508 looms above.
The expected move is lower. That is what SHOULD happen. Traders can wait out rallies and perhaps use higher technical levels as stops.
However, as traders we should also be aware that the 'after the fact" reaction might be in effect. Plus with the market so short (the CBOT Commitment of traders report shows record shorts), it takes new sellers to push lower. If the selling is all done, it can't go lower (and may just go higher instead).
So trade YOUR plan/levels, but watch the levels in the other direction. Remember, the market is bigger than us all. We have to listen to what is is saying.....
