Bearish Case Hanging By A Thread

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

Yesterday’s coordinated push higher closed right below the daily NLBL at 1657. Due to the final stab lower (which touched the 100-day SMA) we now have a new NLBL at 1656.75. As of this writing we are currently still trading below it but let’s not fool ourselves, the bearish case is but hanging by a thread right now. It’s still has a chance – yes – but a push above 1656.75 will most likely be the catalyst for a run higher. So if you are still positioned to the short side then this NLBL should be your line in the sand. Above it the bulls once again are in the driver’s seat.

Crude looking very sweet this morning as it’s being wedged between two SMAs on collision course. I’d be long above the 100-hour and short if it breaches that conveniently placed NLSL at 104.88.

Bonds – still pushing sideways but I’d try a long above 130’30 and a short below 130’20. Something has to give here. Yes, admittedly not my favorite setup today.

AUD/CAD – my only FX victim. It’s been climbing the 25-hour and is now heading for a decision point near two hourly NLBLs. If it can hop above the NLBL at 0.95037 I’d be long – short only if it drops below the SMA at 0.94878 and frankly that would be speculative. A drop through 0.948 would be more convincing. The long side is looking like it has more potential as breaches of the 100-hour BB can trigger a short squeeze.

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