So what are the chances of a higher daily close on Thursday?
Yesterday's view was that if price was below the blue filters it would result in a 5-day range breakout.
So what happens on a breakout?
Often price will come back and test the breakout before it continues down once again.
Therefore my ideal pattern in US markets is to push down on Thursday in the 5-day lows, and then reverse upwards late in the day to close near the 5-day 50% level:- Higher daily close"
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DOW Weekly and 5-day pattern
US markets pushed down early on Thursday hitting the support and reversing back into the breakout from Wednesday.
There was a 500 point turn around in the Markets, but at this stage this is seen only as a retest of the breakout, which more often can see lower prices once again on Friday.
That will depend on price trading either side of Friday's 5-day filter, because a breakout of a 5-day range often leads into a 2-day breakout pattern:- retest the break and then continue with the trend the next day.
In late trading US continued to rally back towards the Weekly 50% level, which is a good sign for the Aussie market to do the same.
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