The bearish momentum has continued last Monday, taking out the Weekly Low at 8002.25, but the market has shown a considerable recovery up for the rest of the passing week.
The whole Weekly bar turned into a false thrust down, as it closed as a bullish pinbar above the important Weekly 50 SMA. In such case, a thrust up above the Weekly High is a good bullish signal for 1:1 Weekly bar magnitude target, closed to the most important resistance above, near the 8400 level.
Currently I wouldn’t trust on such a bullish signal for more than 1:1 target, and by the Monthly price action there are much more chances in the midterm to see lower levels like 7660 being reached before a serious reversal attempt upward is made.
The current Daily bullish signal (made by the penetration of the lower Bollinger band followed by signs of strength, and a later weak follow through down) points to the area of 8155 where the Daily 200 SMA is currently lying.
For smaller stops than the whole Weekly bar’s range, I would wait for the Daily signal to reach the target, to correct down, and to rejoin the bullish momentum once new signs of strength are proven.
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