On the daily chart below, we can see that the market got stuck in a range as soon as it bounced from the 1731 support. The uncertainty is high. On one hand the market is more optimistic as the banking crisis is fading, on the other hand, it is pessimistic that the recent events will cause a bigger slowdown in the economy than expected.
After bouncing yet again from the support, the price is now approaching the top of the range where there is also the confluence with the 38.2% Fibonacci retracement level and the red long period moving average. It’s very likely that the sellers will lean on this level with defined risk and target again the support.
On the 4 hour chart below, we can see more closely the range between the 1731 support and the 1800 resistance. The buyers will need to break above the resistance supported by a fundamental catalyst to confirm the breakout and start a rally towards the 1900 level. The sellers will most likely use the resistance to pile in again and target a break below the 1731 support.
On the 1 hour chart, we can see that the market is trading in a channel and that is diverging with the MACD right when it approaches the resistance. This is a signal of a loss of the buying momentum and it’s another good signal for the sellers. A possible catalyst may be today’s US Jobless Claims report where a beat should make the market to price out some of the extreme dovishness in rates and send the Russell 2000 lower, and a miss (although it should be bearish too) may give the breakout the buyers are looking for as the market will look at rate cuts earlier than expected.
