July continued to closely follow the technical/seasonal script previously discussed. After testing the trend line rising from the April/May lows last Thursday and Friday the prompt rose to challenge the short – term trend line declining from the May highs. The falling resistance trend line was too much of a sell signal and ended the rally. July gave up the gain, traded .004 through last week’s close but stopped short of testing the trend line rising from the April/May lows before recovering to close above the trend line resistance. mentioned last week, a close above the short – term trend line would trigger a test of the intermediate – long term trend line falling from the August/November/December highs. The value of that declining resistance for the past week was $2.383 and the high was$2.380. Also suggested was that the prompt’s first challenge of the resistance would fail which it did. July retraced much of the week’s gain but trading a total range of $.207/dt, and remained well “inside” last week’s range.
It will get very interesting this week when prompt July encountered the trend line declining from the Q3 and Q4 ’22 highs and the trend line from the April May lows (chart above). During the coming week the trend line declining from the August/November/December highs will intersect the trend line rising from the April/May lows. This crowding or convergence of the trend lines is not some kind of magic bullet, but both have substantial technical significant importance.
