We stated in our last report to our clients that "the roll back lower Monday leaves a consolidation bias for Tuesday and maybe into midweek and the FOMC" and we do anticipate an erratic digestion theme into Wednesday, pre-Fed.
However, whilst minimally above 128-185, we still see a bullish bias through late April into May from the strong rally from March and the mid-April rebound from above the key support at 128-055/025.
A further consolidation into midweek and into the FOMC announcement, still reluctant to build on the bounce last week through the 127-16 spike high, capped ahead of 127-28 to leaves bias for a roll back lower to the range, then a bearish extension.
Whilst minimally below 127-28, we see bias for a further bear extension in March, given the significant sell off since February through multiple chart and retrace supports.
A bearish outside pattern to start the week and the month and as we had expected a still more negative theme coming through, since the failure last week back from the 128-16 retrace/ chart resistance level.
Having rolled back into the rebound rage, this now leaves the bias for downside pressures resuming, given the aggressive February sell off through multiple chart and retrace supports and the bearish outside pattern rebound failure last Thursday (from ahead of 128-16).