Last week saw an actively bullish market with Wednesday in particular closing up 190pips. Thursday and Fridays price action remained flat compared to earlier in the week. Despite the strong bullish momentum we saw the market struggled to break and close above the both technical and psychological level of 80.00.
The last three days of the week generated a strong bearish Hikkake pattern showing a clear rejection of the 80.00 area suggesting last weeks bulls may be overcome by the bears in the coming week.
The Hikkake pattern and resistance are further strengthened by a 61.8% Fibonacci retracement & rejection. Notice below how the Hikkake has formed just below and almost touched perfectly the 61.8% Fib level.
With the strong resistance, the 61.8% Fib retracement and the bearish Hikkake pattern, price action at this time is suggesting we may see the market rejoin its bearish trend seen for much of 2011. It’s wise to take note of last weeks weekend gap, that as of yet, has not been closed. Should we see a fall in the coming days the area around 76.00 (the gap) could prove to be a good profit taking area.
