During previous session, FCPO slid lower towards the demand zone (2190 - 2200) before bouncing upwards. Moving forward, the upwards momentum may be short lived and price may go downwards right away early in the morning session. A sharp fall towards the gap area is possible assuming the demand zone (2190 - 2200) that was tested yesterday has been partially or completely consumed. A strong and solid fall is a clear manifestation of unfolding wave 3 of (i) of (5).
We, however, expect FCPO to continue to edge up until it reaches the supply zone (2225 - 2230) before it starts to move downwards.
If market succeeds to stay above 2225 - 2230 area by end of the day, we may see a new high forming tomorrow (thanks to the new spot month contract). The new top will be limited by confluence area (2265 - 2275) and its extreme high will be governed by the upper channels (dotted and solid lines).
We will see what market offers us today.
We, however, expect FCPO to continue to edge up until it reaches the supply zone (2225 - 2230) before it starts to move downwards.
If market succeeds to stay above 2225 - 2230 area by end of the day, we may see a new high forming tomorrow (thanks to the new spot month contract). The new top will be limited by confluence area (2265 - 2275) and its extreme high will be governed by the upper channels (dotted and solid lines).
We will see what market offers us today.