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After the market collapse in February due to the worsening of the global pandemic situation, the IXIC index received a strong boost thanks to the weight of tech giants (Amazon, Paypal, Netflix, Apple, Microsoft) helped by the increasing need to stay connected all day.
The two scenarios identified by the graph reflect the current uncertainty linked in part to the electoral results, in part to the evolution of the Covid pandemic. The red bar of October 2 could identify a simple retracement of an uptrend that could lead to the formation of a head and shoulders pattern, or the starting point for a fourth Elliot wave that will bounce off the trendline towards the 12.000 level.
Monday could be very important to confirm the first or second scenario. Personally, I believe the market is not yet ready for a bubble, but certainly quite overvalued compared to the actual global economic conditions, therefore I would not even be surprised by a third scenario with the candle breaking the very strong resistance at 10.650.
With a positive opening market on Monday, I recommend you to simply wait for the achievement of 17.000 level (and the RSI Stochastic Index stabilization if you need more confirmation) so that a long entry with stop loss at 10400 could be the solution for a reduced risk trading.
Conversely, if the index shows sufficient strength, the entry will be an immediate buy with stop loss at 1700.
After the market collapse in February due to the worsening of the global pandemic situation, the IXIC index received a strong boost thanks to the weight of tech giants (Amazon, Paypal, Netflix, Apple, Microsoft) helped by the increasing need to stay connected all day.
The two scenarios identified by the graph reflect the current uncertainty linked in part to the electoral results, in part to the evolution of the Covid pandemic. The red bar of October 2 could identify a simple retracement of an uptrend that could lead to the formation of a head and shoulders pattern, or the starting point for a fourth Elliot wave that will bounce off the trendline towards the 12.000 level.
Monday could be very important to confirm the first or second scenario. Personally, I believe the market is not yet ready for a bubble, but certainly quite overvalued compared to the actual global economic conditions, therefore I would not even be surprised by a third scenario with the candle breaking the very strong resistance at 10.650.
With a positive opening market on Monday, I recommend you to simply wait for the achievement of 17.000 level (and the RSI Stochastic Index stabilization if you need more confirmation) so that a long entry with stop loss at 10400 could be the solution for a reduced risk trading.
Conversely, if the index shows sufficient strength, the entry will be an immediate buy with stop loss at 1700.