What are the traders leaning against?
I try to figure out what traders are leaning against. If you can lean against a level, you can define and limit your risk. IN an up and down market, you can try to trade extremes.
Looking at the hourly chart, I look at a broken trend line, that was broken on Wednesday, but failed. Restablished that trend line (see red circle 3, 4 and 5 on (Wednesday and Thursday) and then broke below. What I like about the line, is that on the corrective move on Friday, the sellers leaned against the trend line (see red circle 6).
That line comes in at 1.3288 (and moving lower). Stay below, keeps the sellers in control.
Where might traders lean on the bottom now? The 1.3203 is the swing low from May 29th. The low on Friday reached 1.32103. Move below increases the bearishness now.
Drilling to the 5-minute chart below, the price has spent most of the day today below the 200 bar MA (green line at 1.3260 now). The 50% of the move down comes in around that level at 1.3261. That area would be a level for traders to lean intraday.
More recently, the price has stayed below the 100 bar MA at 1.3250 (blue line)
Stay below the 1.3250-615 area is more bearish intraday. Move above and the intraday waters are more muddy (less bearish).
Where are the traders leaning? The hourly and 5 minute are giving some clues and they remain more bearish for now.
