Monday, August 26, 2013

4.30 stands the test

Continued support @ 4.30 - shown in large screen bids - combined with temporarily lower auction volumes - helped last week to push the price above 4.50, for the first time in 2 weeks. However, it didn't take long to see the market correction down to mid 4.40s (previously I marked 4.45 as possible resistance on the way up) where it seems to have stabilized (I say "seems" because due to UK bank holidays, the thin volumes are not the best indicator of the market condition).

Today the market moved in 4.40-4.50 range, with significant support @ 4.40 and reasonable volume on bids around 4.45 - testing the support after falling back from 4.50s. Interestingly enough, previous 4.30 support and today's strength above 4.40 fits nearly perfectly into Fibonacci retracement pattern - see chart above. Closing above 4.40 is still a bullish signal.

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