While it was shortened week due to the MLK holiday there were excellent trading opportunities during the week. The much awaited QE announcement from the ECB came out on Jan 22 which clearly accounted for the rally we saw this week. The question now is which of the 3 scenarios is more likely to play out this week. The notes in the Profile picture below are fairly self explanatory. The case for a bullish scenario is:
- No excess at the all time highs at 2088.75 - poor high coupled with a prominent naked POC at 2086.25
- Clean, clear excess at the 3 week Balance Lows.
- A poor high on Friday at 2057.25
- Friday's Prominent POCs at 2053.75 coupled with the fact that traders went home "short in the hole"