The first week of the month brought no surprises. The medium-term flat continues and the main levels of support and resistance remain weekly and monthly extremes that must be used to search for patterns for their transactions.
The first days of January made it possible for us to observe the implementation of the downward reversal pattern, which was implemented at 100% per day. On Friday, the trade moved to the area of the NKZ 1/2 1.1210-1.1401 defining the zone of resistance. Fixation above this zone did not happen, which leaves room for the continuation of the downward movement and update the January minimum. This model remains a priority. Sales open from the CCP 1/2 should be held as long as Americans keep the price below it.
An important point is the timely determination of the reversal pattern. If there is a breakdown of the NKZ 1/2, the situation can turn 180 degrees in a matter of hours.
An alternative model will be developed if one of the nearest US sessions closes above 1.1410. This will allow to consider purchases, the purpose of which will be movement to the weekly CP 1.1511-1.1493. This will update the January high and will require the closure of most of the long position. While the probability of growth is 30%. Without violation of the structure of the purchase from the current marks are not profitable.
Day short - daily control zone. The zone formed by important data from the futures market, which change several times a year.
Weekly KZ - weekly control zone. The zone formed by the important marks of the futures market, which change several times a year.
Monthly KZ - monthly control zone. The zone, which is a reflection of the average volatility over the past year.
The material has been provided by InstaForex Company - www.instaforex.com