Extreme volatility in the markets.

Good morning and happy Sunday community!

Yet another week of passion in the financial markets. Over the past few days we have experienced phases of euphoria and panic in the space of a very few hours, and this has caused the heartbeats of many traders to pulse significantly.

We must immediately start with a very clear weekly division for all of us: until Wednesday, September 2, all serene and euphoric from the updates of new period highs… Then what?

Then the panic. On Thursday and Friday we witnessed a Nasdaq that made a -11% move very quickly that dragged the other indexes down as well. On the DAX, after seeing a high at 13460, we saw a significant period low at 12740.

Such consistent movements have made this week’sanalysis more uncertain than ever. Do you remember that 12944 level from last week? Well, we closed the week right near here, where we said that closes above would keep the market bullish anyway.

Certainly, after 700-point movements of DAX in two days, venturing a price projection forecast becomes difficult. Going to look carefully at the chart we will notice how well the market has worked the area below here of the old breakout. From there we started with the rally to period highs. Here, in my opinion, is the question of whether the volumetric reloading done with some force in Friday’s finale has laid a solid foundation for new rises in the coming weeks.

Will there still be extreme volatility in the markets?

Always remember that a market that has moved in a very volatile manner tends totry to congest in subsequent sessions and to stay in trading range for a while before regaining decision and strength in its movements.

Extreme volatility in markets
source t3 webank platform

The levels I therefore expect are: defense of long traders from 12944 down to the low of 12743 (let us always remember to look at least at h4, daily closes before screaming for crashes and rises). In this case, I would then see the market set toward 13200/13300, while the areas for defending shorts, in my opinion, begin between 13050 and 13150. Should this level be broken to the upside, it could drive many shortists out of the market. I consider the intermediate areas between 12944 and 13050 to be without direction and without effective volumetric coverage.

Possible breaks to the downside project us to targets in the 12510 area, an old important level from previous sessions, while to the upside we have a target in the 13311 area.

The one thing I feel like saying is that the market remains, albeit with obvious weakness, still bullish in its configuration. At the moment I do not feel like venturing market crashes or other significant structural downturns (news and economic updates permitting).

Have a great weekend!

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