Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
momentum
Daily Time Frame Momentum (D1)
Momentum on the daily time frame (D1) is currently trending downward. Therefore, the market is likely to continue its downtrend for two to three days at the beginning of the week until the D1 momentum reaches oversold territory.
Wound H4
Momentum on the H4 time frame is also currently declining. This suggests that the downward trend may continue based on the momentum trend of the H4 framework when the market opens on Monday.
Wound H1
Momentum in the current H1 frame reflects market conditions at Friday’s close. Momentum in the first half may change when markets reopen after a two-day weekend. Therefore, we will update the first half momentum on Monday to get a more accurate assessment.
wave structure
Wave structure on time frame D1
On the daily chart (D1), prices have fallen for two days in a row. As analyzed previously, this suggests that the market may currently be in wave C within a correction structure.
At the very least, Wave C may continue to decline until the momentum of D1 enters the oversold zone, after which the market may begin to reverse upward.
Eye-catching structure on H4 frame
When looking at the D1 chart, we notice that the drop in wave A is sharp and strong, which usually indicates a five-wave structure.
However, when examining the chart on the H4 frame, we notice that the five-wave structure is not entirely clear, and the fifth wave in particular is not clear. Therefore, it is still possible that the first dip will be a three-wave structure, as I showed in the first half chart.
This is important because:
– If the first wave down is a five-wave structure, then wave C may also develop into a five-wave structure.
If the first decline is a three-wave structure, Wave C may develop into a separate corrective pattern.
Both scenarios suggest the decline is likely to continue, but the ultimate goals and monitoring patterns will be different.
Scenarios we are currently focusing on
Now we will focus on the situation where wave A in the first decline is a three-wave structure.
In this case, the C wave may develop in the form of a WXY correction pattern (red).
The first target area worth watching is the 4820 area.
When price reaches this area:
– If D1 momentum has entered the oversold zone,
This area may represent the end of a Y wave or a C wave.
Or at least we may see a bullish rally on the D1 time frame that will last for a few days.
H1 frame monitoring
Signals on the current H1 frame still suggest that another bearish wave is likely.
However, it should be taken into account that the market has experienced a two-day weekend. Given the current geopolitical volatility, the possibility remains that the market will open with a gap on Monday.
Therefore, when the market opens, we will update our target liquidity areas and trading plans to more accurately assess upcoming market movements.
