US 500 set for oversold bounce??Hi Guys,
The US 500 has faced some selling pressure over the last few sessions of trading and is nearing an area from which we may see a bounce.
The Green box just below price on the chart is that area and looking left it contains an obvious demand zone from which there was a big move. The green box above price also contained a demand zone and there was a huge bounce off that just recently (29/8).
There is a harmonic butterfly pattern with good fib ratios which has developed and has completion/ entry point in the zone.
The area is also the 38.2% retracement of the high we have just pulled back from measuring from the daily swing low.
Hourly RSI has been in and out of oversold and is now showing clear divergence as is the 4 hour RSI. A dip back into oversold on the hourly and then a higher low often leads to a good buy point and can be confirmed on lower time frame with price.
Once price enters the zone, lower time frame entry using candlestick, chart pattern, CHOCH BOS etc could lead to a nice risk to reward trade.
