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A deal was agreed on Cyprus last night and equities and EURUSD rallied strongly.

I follow San's work and he was suggesting on Friday that we might well be looking at a diamond top forming on ES. Here's how that looks on the SPX 60min chart:

If SPX can break up out of this diamond at the open then we might see the 2007 high at 1576 tested shortly. The daily upper bollinger band is now at 1581, so we could now see that within the daily bollinger bands:

This might well however not be a diamond. The ES channel I posted on twitter on Thursday is still looking strong, and after testing channel resistance ES has topped out short term on strongly negative 60min RSI divergence. On ES at least there is now an active RSI sell signal and the obvious target is at channel support in the 1538-40 area:

EURUSD rallied strongly on the Cyprus news, but developed strongly negative 60min RSI divergence as well and has since fallen back sharply.

Arguably the ragged IHS I was talking about on Friday morning has made target and main support on EURUSD is still therefore at 1.288. We'll see whether EURUSD can hold there:

I've been drawing in what might be the first half of another diamond forming on CL the last couple of days without commenting on that.

CL has rallied sharply overnight but has not yet reached the obvious target there in the 95 area:

If we see ES break up confidently over 1560 today then the target is a test of the 2007 high. Until we see that though the obvious next move is to short term channel support in the 1538-40 area.

 

Source: Springheel Jack

                       

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