We had been looking to trade around this SPI200 top, that has since been chopped through.
What has caught my eye today however is the way that price has tucked back underneath the level as resistance once again. This has essentially reactivated the old level and even though it has been broken in between, becomes just as significant as if it was a cleanly tested level.
As you can see, price has once again held here at the green ‘x’, giving us an opportunity to try to build a short position. Zoom into the intraday charts and try to identify pullbacks into previous short term support that could be used as resistance. If that doesn’t do it for you, then take a step back and I’m sure you can find a head and shoulders pattern of a four armed man.
It’s all confluence!
Best of probabilities to you.
Dane Williams – @VantageFX
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Source: Vantage FX Blog