8-Hour Analysis:
Big Picture: The sellers dominated the session, breaking below the intraday supports and then challenging the weekly supports. The session close yesterday was the lowest since mid-July. However, the weekly supportive range remains solid and has survived yesterday’s selling push. On the contrary, the current session is seeing a significant wave of short-coverings, which has nearly erased yesterday’s losses. Going forward, bulls would need to conclude the session strong today in order to counteract the selling pressure, however if price loses strength in the later hours, it would imply that weakness still exists.
On the Upside for the first time in several sessions, price is set to aggressively attack the EMAs. The important trending EMAs of 26 and 50 are set to be surpassed. Furthermore, the price is going to test the resistance level of 26,350-26,550. This is a significant resistance area for the price to overcome. If the bulls can break through this zone, the upside potential might extend back to the 27,125 to 27,850 levels.
On the Downside price had lost the support level of 25,620 following yesterday’s selling spree, but with the reaction from the weekly support levels, this level of support might be reestablished. An additional intra-day support at 25, 580 could also be formed for the session. Meanwhile the session’s major supports remain firm at the weekly levels of 25,250 to 24,850.
