FCPO - The Market Holds At Vital Support Level - 1/20/2014

The market bounds back strongly on last Thursday and closed above the bottom band which effectively closed off my previous shorts positions. The Stochastic has already turned positive, but I would wait for it to cross up above its 20's signal line before deciding engaging in a new buy position. The MACD still remain negative and below its zero signal line which is bearish. The DMI is also remaining negative but the ADX has stopped rising and turned flat. The flat ADX is a good sign for the bull as it may mean the prior trend has stopped. So the game plan will be to wait for the Stochastic to cross above its 20's with price stays above the bottom band before engaging a new buy position. And sell again if price goes below the recent low again.

The weekly chart's indicators all seem to favor the bears as the Stochastic has now fallen below its 80's signal line. The MACD stays negative foe the second week. The DMI may still be positive but the D+ is falling and the D- has been rising fast. By the coming week we may see this turning negative. The only item that may still favor the bull is that the ADX is still falling as this may indicate that there is no new trend in the market yet. With that, I may want to interpret the current situation as another range bounding market. The most "encouraging" sign for the bull would be the vital support level of 2485 holds up when the market went down to test and was soundly beaten back. As long as this support level is not breached, I would still hold some hopes in the return of the bull.

The US Dollar has resumed its ascent the past few days, maybe it will lend a helping hand to the FCPO bull ?