On the daily chart below, we can see that the sellers failed to break decisively the support level at 32684 on the first try. This may be just a pullback before more economic data confirms the new downtrend.
We got some bearish stuff in the past days with the “prices paid” sub-index in the ISM Manufacturing PMI report showing a jump back into expansion and Fed’s Waller yesterday signalling that the Fed will go above their projected terminal rate if the data keeps coming in strong.
Today we will have the ISM Non-Manufacturing PMI report and if that beats expectations, especially in the “prices” sub-index, then we should see the support breaking and more selling pressure coming in going forward.
On the 4 hour chart below, we can see that the price has been consolidating near the support as the market awaits more economic data before confirming the bearish trend.
On the upside, we may see the buyers pushing the price into the 33538 resistance where we can also find 50% Fibonacci retracement level, but that looks unlikely unless today’s report misses expectations. On the downside, we should see the sellers jumping in strongly in case the report beats expectations with a breakout of the support at 32684 very likely.
In the 1 hour chart below, we can see the more near-term price action. The buyers may manage to get to the 38.2% Fibonacci retracement level before the PMI report which would act a strong resistance and would be a gift for the sellers if the data beats expectations. On the downside, more aggressive sellers may also enter at the breakout of the trendline in expectation that the support won’t hold.
