Market State: NEUTRAL DIGESTION
The longer term Market State remains BEAR TREND CORRECTION but the contract has shifted into a NEUTRAL DIGESTION market state with a sideways expectation.
A NEUTRAL DIGESTION technical state is typified by directionless sideways trading action. False BREAKOUT signals are common in this technical state. Expectations are for price move with no follow through and “misleading” intra-day structure formation
NEUTRAL DIGESTIVE sessions can be the precursor to a “BREAKOUT” as the coiling action will build power. Typically a sign that the sentiment is going to change from neutral digestive to trend is signaled by an early session trend move with no break in the positive or negative structure. A simple Moving Average is a great tool to use to identify a possible “Breakout” day with the expectation that if the market is going to scale up or down it will maintain a trade above or below the Moving Average.
The underlying long term negative bias has sentiment above the market, defined by the R LEVEL.
R = 1348.7
UP = 1336
DP = 1308.3
EXPECTATION is for any positive price action to be contained within or below the UP-R resistance and any negative momentum to find support above the DP [DOWNSIDE PIVOT]. The underlying sentiment bias is negative so the DP should support any weakness if the sideways forecast is going to hold. A failure from the DP support is a sign of weakness that is leveraged by the negative sentiment bias which must be respected as the potential start of a transitional trade and the potential resumption of the underlying long term BEAR TREND.
