Friday, October 22, 2010
USDX Weekly chart suggest we have a completed AB=CD pattern that implies a reversal into USD strength with immediate target 79-80.
My previous target 2950 on Shanghai Composite (http://constellation1976.blogspot.com/2010/10/shanghai-composite-momentum-persists.html) has been met and actually exceeded. Think momentum is Topping here and I expect a rise in Volatility.
S&P still manages to squeeze higher but Momentum is waning.
VIX is like we live in bliss and economy is alright. My assumption is hang there for a while and Volatility spikes higher as some 'fundamental' data or other theme surfaces again. Be it QE2 disappointment, another debt problem or political tension - there is always something to blame for the price action. If anyone cares.
Monday, October 18, 2010
Friday, October 15, 2010
What we have here?
Candle pattern says Shooting star followed by a Hammer - do we have a signal - I assume at least caution here but we gotta hear what Mr. Bernanke has to tell markets at this critical junction.
Thursday, October 14, 2010
10Y Note made Higher High however 30Y Bond might be signalling weakening in the trend of the Fixed Income market which is evident in the Momentum readings.
I could not know if bond vigilantes are rejecting owning a 30Y paper at the current low yields or the FED has more power in suppressing the short to medium term (2-10Y) yields however I take this DIVERGENCE as a sign of pending trend weakness.
Weekly chart shows CRB is on a Breakout mode and near its 200-Week MA.
Momentum is rising and trend strength is slowly kicking in.
Inflationary times are coming and judging from the chart they will have a long way to go.
Following on my previous call (http://constellation1976.blogspot.com/2010/10/shanghai-composite-momentum-buy.html) on the Momentum strength in SSEC here we are above the 200-Day MA.
Next target is the confluence of the Trend Channel and the previous lows around 2950.
Wednesday, October 13, 2010
USD/JPY Hourly Trendline - Works like a clockwork.
A question when it finally break to the upside remains.
Weekly USD/JPY shows under the Long term Support line - there is possibility for a fake downbreak unless BOJ walks out of it..
Daily USD/JPY shows clear down channel that meets the trend line Support at this critical junction - my test scenario suggests we go for 84.
Nice horizontal Range withing the Rising Trend Channel in 4-hour EUR/USD - so we test 1.4 before we break lower or we see a failure right here?
Same case in 4-hour AUD/USD - Trend lines suggest we go for a test of 0.99 before a significant Resistance kicks in. The surprise will be an outright break here.
US Dollar Index looks like bottoming and yesterday candle resembles a Bullish Engulfment, however today's candle is not a good confirmation sign..
Momentum and RSI suggest we bounce off the Lows which are significant on the long term charts around 77 level and my guess is we see a wave of USD buying after the FED announced its blur willingness to ease further its policy.
Sunday, October 10, 2010
Saturday, October 9, 2010
Trending and over extension of the move doesn't compromise the trend momentum.
Different time frames and fibs - now that moves exceeded the conservative projections I focus on the momentum concept as it is very insightful to learn never to fight a roaring trend and always let it go until you see a rising volatility, reversal chart pattern or some other sign of trend weakness.
I have drawn the consolidations that follow the price thrusts. Clear Support & Resistance levels are shown.
Time & Price relationship.
MAs are enveloping the unfolding trend but they lag and this actually helps to project a horizontal range trading after the motive wave until the MA makes up the space and then the trend move ensues.