Wednesday Prep
The headline driven weakness overnight yesterday followed through for the first half hour, breaking straight through the prior day’s low. Most of the morning was choppy upward drift hitting a high one tick ahead of the prior day vpoc. There was a clear downward shift in TICK momentum as the high was made (see 1 min chart above right) which ultimately led to a break lower in the afternoon session.
Overnight so far the market has bounced and the current range is 2878.00-91.25 vs settle at 2882.50. A slew of European industrial production data was better the consensus forecasts, ECB announcement as expected and pending is US CPI and FOMC minutes.
Zones of interest today are above (right). A lot will depend on whether the market can break and hold above the 90-92 zone (in which case the recent weak high at 2900.00 looks vulnerable) or fail to and possibly consolidate around the current month vpoc which is now at 2882.75, and/or push lower. Higher timeframes remain bullish obviously.