(Click on the Daily chart to enlarge it)
Last week I mentioned that the Daily chart from Jan 2007 to current shows a beautiful Broadening Wedge Descending, with the Stochastics making higher lows while prices made lower lows (Bullish divergence), thus favouring a possible major reversal pattern.
Now, the Hammer formation last Friday Oct 02nd at the main support area 88.24, without prices moving further down to re-test the bottom at 87.14, with Stochastics kicking up are all excellent reasons for LONG positions.
My strategy is to enter LONG at any support level above 89.78, and will add lots at break of the following resistance levels: 90.21, 90.50, 91.03 and 91.65.
If prices start moving down below 89.21 and breaks the low of this Hammer formation at 88.61, thus cancelling it, I´ll re-analyse the market for SHORT entries.
