NicoBeau_Capital

A Wide Horizontal Channel Provides A Great Buy Opportunity

Long
Since February, US100 has been moving in a $2200 wide range. This range is very wide, but the price has succeeded in reaching the resistance and support levels multiple times. This shows that an immediate break is not likely at key levels and might at least require multiple short-term re-tests before the levels can be broken. From 13000 support level, we can see that the price has bounced up twice from this level and the price rejections were quitely strong. After a doji candle was formed, a large bullish engulfing candle immediately followed, creating a strong bullish momentum. Therefore, as the current price goes near the support level, along with a RSI exhaustion, we need to carefully observe the price action. A preferable candlestick combination would be a doji star followed by a bullish engulfing candle. After a reversal formation is confirmed, we will set buy stop orders a few pips above the engulfing candle. Our first target will be in the area of 14260.
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