The S&P 500 Emini futures continue the strong rally up, likely to test the May 4 high and the bear trend line. The move up is strong enough for traders to expect at least a second leg sideways to up after a pullback. The bears want a reversal lower from a wedge bear flag (June 28, July 29 and Aug 13), but because of the strong leg up, the bears will need at least a micro double top or a strong reversal bar before they would be willing to sell aggressively.
The EURUSD Forex continue trading sideways to up, testing the May breakout point. The current pullback has a lot of overlapping price action, indicating that the bulls are not strong yet. The bulls need to create consecutive bull bars closing near their highs and trading back into the 10-week trading range to increase the odds of a failed breakout below the 2017 low. If the pullback remains sideways, odds are the bears will get a second leg sideways to down re-testing July low.
The EURUSD Forex is still in a sideways to up pullback on the weekly chart. The bulls have not yet been able to create strong consecutive bull bars since breaking below the 2017 low. If the pullback remains sideways, odds are the bears will return for a re-test of the July low.
The S&P 500 Emini futures tested close to the June 2 high. Bears want a double top bear flag, but the bull small bar on the weekly chart is a weak sell signal bar for next week. The move up since July 14 is fairly strong. Odds are the bulls will get at least a small second leg sideways to up after a pullback.
The S&P 500 Emini futures closed below the 20-month exponential moving average in June. It reversed to close above the 20-month exponential moving average in July, like the prior 2 occurrences during the sell-off in December 2018 and the Covid-19 sell-off in 2020. The bulls need to create a consecutive bull bar in August to increase the odds of a re-test of the all-time high. July is an inside bull bar. It is a breakout mode pattern. The first breakout has a 50% chance of failing.
The EURUSD Forex July candlestick was a big bear bar with a long tail below. It broke below the 7-year trading range low. The long tail below indicates that the bears are not as strong as they could have been. The bears will need to create a consecutive bear bar to confirm the breakout below the 7-year trading range. The selling has been climactic. The trend channel line overshoot and wedge bottom (November 24, May 13 and July 14) increase the odds of at least a small sideways to up pullback (for a couple of weeks) before the EURUSD continue lower. The pullback may have begun in July.
The S&P 500 Emini futures traded higher from a higher low major trend reversal. Bulls need to create a consecutive bull bar (follow-through buying) next week, something they have failed to do since March. The bear trend line and 20-week exponential moving average remain resistances above. If next week closes as a bear bar instead, it will mean the bulls failed to get follow-through buying yet again. Odds of a re-test of June low increases.
The EURUSD Forex broke below the 2017 low with follow-through selling recently. The bulls want a reversal higher from a wedge bottom (Mar 4, May 13 and July 14) and a trend channel line overshoot. However, the move down is in a tight bear channel. That means strong bears. Odds slightly favor lower prices for the EURUSD after a larger pullback.
The EURUSD Forex had consecutive bear bars below the 7-year trading range which confirmed the breakout. Bears want a measured move down based on the height of the 7-year trading range which will take them to the year 2000 low. While odds favor lower prices, the trend channel line overshoot and the wedge bottom increase the odds of at least a small sideways to up pullback beginning within 1 to 3 weeks before the EURUSD continue lower.
The S&P 500 Emini futures broke below the prior week’s bull inside bar but reversed to close near the high. It is likely a failed breakout from the i pattern. Bulls want a reversal higher from a wedge bottom and a trend channel line overshoot. They want at least another leg higher from a higher low major trend reversal. The bulls will need to create consecutive bull bars closing far above the June 28 high to increase the odds of a test of the June 2 high.