It was a quite interesting week for Fiber especially at Thursday. As we should know it is crucial to understand the higher time frames and the path of least resistance. Maybe we can figure out with plain charts and our top down approach the story behind of the previous week’s action.
As usual, we start off with the monthly perspective. Looking at this timeframe, we can see a pretty balanced market since several months and a possible double bottom but I can tell you: Avoid trusting in double bottoms or double tops! I assume we have some nice liquidity in terms of stops to grab below the lows. The previous month somewhat broke that bracket area without leaving a buying wick. We’ll see how the market will react at that marked resistance area inside of the bracket area:
Moving forward to the weekly timeframe, we can see that the market actually broke the one time framing lower behavior that occurred for around six weeks. Back in October I mentioned the selling tail from August and my bearish view for this market:
The market took out a swing low and could target the previous swing high now. However, the bracket low turned out to be a nice resistance area and the market tested it to the tick as visible on this chart:
Now, looking at the daily perspective, we can see this knee-jerk up move from Thursday. Actually, this particular move stopped out the rest of my short position. Anyway, with the higher time frame information I am still quite bearish but will closely monitor the development in the next days for sure. I guess there are some ‘holes’ in Thursday’s rapid move to fill, so I will look for some short trades next week. I will report about my intra-day views and live trades on The Private Banker.
Please remember my past performance is not indicative for future results and my market view can change in a daily basis. Do your own research and analysis to determine the risk and market situation. All information here is for educational purposes only and is not investment advice. Let me know if you have any questions about this post or The Private Banker products.
Have a great week!