- Charts on selected symbols with STOPD Levels are posted
- Recap and outlook commentaries are added to some posts as demonstration of applying STOPD and classic Chart Reading Techniques in actively traded markets
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Test of the support zone mentioned last week as expected. Support held up well and gave us a push to Y+2. Closed the week near Y+2 and week high.
Measured move upside target reached from the run started 3 weeks ago. 1.14 is key price level for weekly to break the down trend. A spike reversal next week against B+1 will give us Y+1 / B-0.
Dow pushed higher as expected early in the week. Since then failed to clear the upside and breached Y-0. The break led to all out sell off since. Closed the week below Y-3 and near week low.
A bounce is due but not necessary what we normally expect. It can be a huge squeeze higher thanks to the increased volatility but that does not translate to a reversal automatically. Expecting wild 2-way play all week with a slight bias for positive close on weekly basis.
Bullish bias worked out. Y-0 support gave us a test of Y+1. Closed the week near Y+1 and week high.
Upside breakout points to B+2 and B+3. FBO against B+1 on daily closing basis points to a drop back down to B-1.
Y-0 support as expected and sent NQ up to near Y+1. NQ failed to clear the former support zone, forced it back down to test Y-0. Fed minutes released on Wed and then Asian markets going south helped NQ to break the Y-0 support sending it straight down to below Y-1. Option expiration amplified the move to clear the normal breakout target of Y-3. Closed the week below Y-4 and near week low.
A bounce is likely with consolidation around B-1 also likely. Even at reduced range, this coming week will be wild relative to the quiet times we enjoyed over the past few months.
Note: Somehow the post for last week is missing from the database.
Consolidation week at 50% previous week range. Closed the week near Y-0 and below midpoint.
3rd week in a row closing near the same price level with midpoints all near each other is compression. It can also be near equilibrium. For the first case, we need a breakout to form a trend first before we can engage. For the second case, the volatility will die down further leading to more consolidation and tight range. Wait and see for this pair until the condition changes.
Bullish expectation worked out as cable continues to challenge the upper boundary. Y-0 support sent cable higher. Closed the week above Y+1 and midpoint.
Cable rising wedge on 4 hours can break the up trend if B-0 is breached. As long as B-0 / Y+1 zone holds, cable can still push to Y+2 and beyond.
3 Pushes Up top as mentioned last week gave us a clean sell off down to Y-2 and waterfall effect carried ninja lower to below Y-3. Closed the week below Y-3 and near week low.
The last part of the flush is mainly stop run. A bounce to 123 area is reasonable. Consolidation play around B-1 with reduced range likely.
ES made it to the open gap fill above early in the week as expected. Since then consolidation for the Fed minute release on Wed. From there Y-0 was breached decisively leading to a drop to below Y-1. That opened the door to breakout target Y-3 and below. Closed the week near Y-4 and week low.
More downside likely but a bounce is due. One week with 130 points range is rare in recent history. This means majority of the active traders will not know how to react to the situation because they have never seen one in their trading career.
Consolidation around B-1 is expected with the potential of a huge squeeze back up to Y-2 / B-0 possible. The breakout of new high in volatility on Friday points to more wild swings in the card. Trade with caution.
Quick Access to Weekly Outlook Over Last 3 Months
2015 Aug 31 – 2015 Sep 4
2015 Aug 24 – 2015 Aug 28
2015 Aug 17 – 2015 Aug 21
2015 Aug 10 – 2015 Aug 14
2015 Aug 3 – 2015 Aug 7
2015 Jul 27 – 2015 Jul 31
2015 Jul 20 – 2015 Jul 24
2015 Jul 13 – 2015 Jul 17
2015 Jul 6 – 2015 Jul 10
2015 Jun 29 – 2015 Jul 3
2015 Jun 22 – 2015 Jun 26
2015 Jun 15 – 2015 Jun 19
2015 Jun 8 – 2015 Jun 12
2015 Jun 1 – 2015 Jun 5
2015 May 25 – 2015 May 29
2015 May 18 – 2015 May 22
Each symbol has its weekly STOPD levels drawn on the chart,
- Thick blue lines show the range of the week they are drawn on
- Thin blue lines are the midpoint of the weeks
- Thick orange lines are 100% expansion levels away from the range of the week
- Thin orange lines are the midpoints between thick orange lines and the thick blue lines
- Thick red lines are 200% exapnsion levels away from the range of the week
- Thin red lines are midpoints between the thick red lines and the thick orange lines
The last 2 weeks on each chart has the weekly STOPD levels labelled,
- The week just finished has its labels in blue. B-0 is the midpoint of the week. B+1 is the high of the week. B-1 is the low of the week. B-2 is the 50% downside expansion of the week.
- The prior week has its labels in yellow. Y-0 is the midpoint of that week. Y+1 is the high of the week and so forth.
Following is an example chart showing the forex pair USDJPY in 4-hour resolution.
Related research and articles on using STOPD weekly price levels.
Euro Dollar Price Action Biases At Weekly Extremes
British Pound Price Action Biases At Weekly Extremes
More research articles available in our Latest Articles section.