Positive tendency has stopped after S&P fell for 0.1%. Market now has to digest growth that took place since May 21 and to refresh it’s powers to continue. It would be greate to see the roll back to 8/21 EMA which is in the $188.85-190.00 area. Then it would be easier for traders to buy, because now there is no enthusiasm and activity on the market. We have seen a lot of false breakthroughs and the price was in consolidation after ~30% growth in 2013.
Active traders should point out support after the opening at $190.95. And futures also hasn’t fell lower then 50 EMA since middle of April. Nevertheless market is near it’s maximum and there are a lot of potential buying areas despite all the rumours in news and complicated geopolitical situation in Ukraine.There are mixed feelings in trading on European and Asian markets.
Social Networks Cought up the Buying Wave
Twitter (TWTR) has woken up yesterday and surpassed another social network Facebook (FB). But even with 10% growth stocks look crushed. After the IPO held by the company in November 2013 it closed positions on $44. Than the price was a little bit higher then $72 and traders did not want to buy. Than there were a few unsuccesfull quarters because of not wery good earning reports. The company had incursed losses and the main problem remained how to monetize subscribers. Stocks had set a false bottom $30.40 and I would not trust this level, but now we have day #1. On the day #2 we may see the 1st day tendency and the day #3 gives us an opportunity to cover losses, wait for a confirmation and check out how strong buyers are, chek out their opportunity to keep the price near the top, while there are good chances for a continuation. If buyers want to remain in control of the price, they should hold the growth at $32.50 and one more point of making decision — the top of the previous day $33.84. Closest targets of resistance, where we saw a gap down to $36.10 and the level which was a strong support in $39-$40 area. By coincidence there is also 50 EMA, which controls the price since the beginning of March.
AUD/USD jumped off a strong suport level 0.92000 which took place since the beginning of April. This pair cought up perchasing sentiment after an upside-down Head&Shoulders pattern and it’s penetration at neckline 0.90500. Buyers has now resumed key moving avarages and I think it may be a beginning of further movement and potential bull flag breakthrough. I’ll buy downtrend and a good buying area might be 50% downtrend to 8/21 EMA 0.9267-84. If there is penetration higher than the top — it might attract more active middle term traders.
I mentioned yesterday that our USD/JPY downtrend forerunner was false breakthrough of a trend. On a daily chart I also see a downtrend tendency. On the one hour chart you may distinguish 3 periods of market situation marked with arrows: buyinf, distribution and regress. Now we are in a regress area but the price is far from short term moving avarages, so I’ll wait for a roll back. The key level is 101.627, for instance flag consolidation lower than this level may lead to a further downtrend. The first target remains 101.400.