- 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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NQ found support overnight before Monday open and rallied straight up since. This move caught many people by surprise and further fueled the run to clear Y-0 quickly, giving us a go for Y+1. Closed the week near Y+1 and week high.
Outside reversal week usually leads to bullish outcome. But this time, the run was the result of unusual circumstances, hence a sharp pullback is likely if we get FBO against B+1. Holiday week points to lower volume and consolidation actions around B+1.
Aussie successfully cleared 4 hour down channel top, giving us Y+1 and then Y+2. Closed the week near Y+2 and week high.
Aussie’s recovery against US dollar can be a leading indicator that gold may hold its latest drop into new low for the year. Y+1 / B-0 support will be tested if Aussie fails to consolidate around Y+2 / B+1 in 50% range.
Cable found support at Y-0 and eventually challenged Y+1 and then the break down crime scene I mentioned last week. Thatès all it can do and the selloff started. Closed the week near Y-0 and below midpoint.
The daily bear flag on cable will be confirmed if a daily close below B-1 is printed. The longer term players will likely give up longs and lead to a drop back down to Y-1 and below.
Y-0 resistance sent Euro lower. Y-1 not strong support as explained last time. Euro found support after 100% absolute range expansion to the down side. Strong bounce back up to Y-0 and rejected. Closed the week below Y-1 and midpoint.
A push down to test 1.06 is in the making. The question is whether Euro zone will do something about it. The emergency meeting called by the Fed and other central bankers this Sunday é Monday may produce a lot of surprises to the trading communities.
Spike low against Y-1 as mentioned last week points to a retest of Y+1. Got the retest and stronger reaction this time sent ninja back down to below Y-0. Closed the week below Y-0 and midpoint.
2nd rejection of Y+1 from an outside week points to further weaknesses. as long as Y-0 é B-0 acting as resistance, we get B-1 and below. It may not be a very strong selloff, just pressing ninja back down to test the crime scene near Y-2 that started the short squeeze 2 weeks ago.
Test of Y+1 rejected. Dropped back down to Y-0 and found support. 2nd attempt led to all out selloff back down to 100% absolute range expansion. Found support there again and bounced back up. Closed the week near Y+1 and above midpoint.
Thanksgiving week in US will slow down currency trading a lot. In fact, this is the start of the holiday season for which trading in many markets will get lower volume and reduced volatility.
If we see consolidation actions this week again with further gain into the 1.34 area, another upside break will carry this up to 1.36 area quickly.
Overnight pre-open, the downside target was tagged by the index futures, since then Dow never looked back. Trend buy all the way bac up to where the sell off started and stalled from there. Closed the week near Y+1 and above midpoint.
Extreme buying from the combination of several factors has given Dow the necessary momentum to go higher, but it has to deal with the short term over extended condition. A sharp pullback is likely. A drop back down to B-0 is possible.
Overnight ES dropped below 2000 and the buying started right on schedule. The straight up reversal surprised many traders and created a short squeeze later in the week forcing a push above Y+1. Closed the week below Y+1 and above midpoint.
A retest of B+1 will tell us if this rally has legs. If rejected, we can expect a pullback to 2060s again.
Spike low against Y-1 above Y-2 sent Aussie back up to Y-0 as expected. Going sideway since. Closed the week near Y-0 and above midpoint.
Gold test of year low in progress and the outcome can dictate the next move in Aussie. If gold going for all out break down from the current level, Aussie will be the collateral damage with channel top resistance at B+1 and dropping down to B-2 target.
Consolidation actions around Y+1 most part of the week. Jawboning happened by Japanese officials but no impact on the price actions so far. Closed the week above Y-0 and below midpoint.
4 hour / daily bull flag points to continuation to the upside likely. Spike low against B-1 above B-2 will signal at least a test of B-0 and that will in turn break the bull flag resistance.
Clean spike and ledge setup worked out perfectly tagging target near Y-3 and no support until 200% range expansion was completed. Closed the week near Y-4 and week low.
The terrorist event in Paris at the end of Friday can lead to unexpected outcome this coming week. Swing resistance stands at Y-2 / B-0 while a gap down to 17000 round number lines up with 5% pullback can happen as early as Monday.
Bull flag pullback follow with test of Y+1. Strong reaction against Y+1 yet holding the bull flag resistance / channel top. Closed the week near Y+1 and above midpoint.
Consolidation week with 50% range and close near Y+1 is mildly bullish. Main issue is that there is a lot of money at stake around this level for which a breakout to the upside means 1.35 and 1.40 in play. The longer term players will determine the outcome. Day traders should focus on hourly and lower timeframes to ride along with the big boys.
NQ followed the other 2 indices breaking its daily support and slided down to B-1 and in turn breaking B-2 as mentioned last week. The waterfall effect helped NQ to backfill its huge open gap below. Closed the week below Y-4 and at week low.
Support from B-1 / Y-5 has to prove their strength first before a bounce can happen. A quick drop to B-2 is in the card if players with high leverage are forced to liquidate their long positions.
Found support from Y-1 / previous week close and started an up drift back up to Y-0. Closed the week below Y-0 and above midpoint.
Thin up channel / up drift back to Y-0 is bearish. Cable may still try to break B+1 to get back to the break down crime scene near Y+2. If violent reactions taking cable back below B+1, a slide back down to Y-1 and below will be likely.
ES smply gap down and break Y-1 right off the start. This opened the door to Y-2. ES struggled to hold up with a bear flag and eventually gave in to tag Y-2 and could not find support until 200% absolute range expansion was reached. Closed the week below Y-4 and at week low.
Situation complex due to the event happened in Paris. Potential flight to safety that can break Euro hard and help strengthen US dollar even more. This in turn can force ES to flush down to 2000 round number first before player would re-evaluate the situation.
Euro spent all week struggling around Y-1. An attempt to push higher was stopped by 50% range. Closed the week below Y-0 and above midpoint.
Consolidation week near Y-1 is bearish and B+1 is strong resistance. A continuation move down to B-2 likely as long as Y-0 / B+1 can cap the bounce.
Quick Access to Weekly Outlook Over Last 3 Months
2015 Nov 23 – 2015 Nov 27
2015 Nov 16 – 2015 Nov 20
2015 Nov 9 – 2015 Nov 13
2015 Nov 2 – 2015 Nov 6
2015 Oct 26 – 2015 Oct 30
2015 Oct 19 – 2015 Oct 23
2015 Oct 12 – 2015 Oct 16
2015 Oct 5 – 2015 Oct 9
2015 Sep 28 – 2015 Oct 2
2015 Sep 21 – 2015 Sep 25
2015 Sep 14 – 2015 Sep 18
2015 Sep 7 – 2015 Sep 11
2015 Aug 31 – 2015 Sep 4
2015 Aug 24 – 2015 Aug 28
2015 Aug 17 – 2015 Aug 21
2015 Aug 10 – 2015 Aug 14
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.