The trading idea from last time is still going in the expected direction.
GBPUSD has gone down almost 350 pips since I wrote about it.
Just as a reminder- there was a bearish engulfing pattern on the daily chart and price went on a steep dive.
Currently, the price is located between a major support level and a minor resistance.
I would be cautious, especially at this level when price can literally go both ways.
I will not be opening any new positions.
Germany 30 (DAX) Market Analysis for 22.11.2021
Today, I am looking at the German stock market.
There is a major supply zone that was pierced by price not a long time ago, as the image above illustrates.
The question is, where will price go next from here.
A little hint is that the price has formed a bearish engulfing pattern on the daily timeframe.
This looks like a good signal for the bears.
I will not be surprised to see the price moving lower to at least re-test the supply zone.
And why not break below it?
At this moment, anything is possible.
So, I guess we will need to just wait and see which direction will price take.
I might decide to take a short trade if I see price retracing back to 16250.
This needs to coincide with a bearish confirmation from the lower timeframes, starting with the 4H chart.
If I don’t see such a confirmation, I will just move on and wait for another pattern from the daily timeframe.
Have you checked my recent article on Pump and Dump Strategies?