Trading Week 27/08/12

Friday 31/8 (6.30 pm)

The 81.7 level is still capping the USDX...for the time being at least:

Friday 31/8 (5 pm)

You can tell I'm bored....this song came to mind just now when I was looking at the cloud chart for the EURX...up or down....we've gotta get out of this place.....
http://www.youtube.com/watch?v=LUpBSvN1a50

Friday 31/8 (3.30 pm)

The USDX is struggling at the 81.70 level:

BTW: I have updated my Stocks: Aug page with my Coca Cola KO trade.

Friday 31/8 (11 am)

Comments from CNBC.  Key Points to Look for in Bernanke’s Jackson Hole Speech

Worth a read! http://www.cnbc.com/id/48849719

Friday 31/8 (5.40am)

I'm up early today so as to roll some options out. The indices are still just bouncing along. The USDX bumped up into the 81.70 level, previous strong S/R, and has paused a bit:

Price is still stuck in the daily cloud on the EURX chart:

The A/U has fallen and tested the bottom trend line of its descending broadening wedge pattern. This technical pattern will most likely be over run by fundamentals though with outcomes from Friday's US Fed meeting:

I did receive signals over the last day or two on the A/U and A/J. They each gave a maximum of 50 pips. I had a signal on the Loonie too which gave about 30. I didn't take these trades due to the Ichimoku Index patterns. Yes, sometimes you miss a winning trade by following this rule but I think that is better than getting into more losing trades that whip saw around. The benefits of this rule have far outweighed any negatives.

Personally, I don't think there will be any new commitment to QE3 from this meeting. This will probably send the USD higher and drag all risk on assets down, for a while at least. Just my 2 cents worth!

Thursday 30/8 (8.45 pm)

Not much to report...again! We're still in the mess of the EURX daily cloud:

I've actually used this quiet time to write up an 'About Me' page. You will see this as a tab above. I have only recently been in a position where I could publish this information. 

Thursday 30/8 (5.30 pm)

Nothin' new...waiting waiting!

Thursday 30/8 (6.15am)

It is no surprise to me, or the rest of the world most likely, that little happened trading-wise overnight. The USDX continues to creep along, just above, the weekly bull trend line:

This lack of movement has meant that the EURX is still embedded in the cloud on the daily Ichimoku chart:

There was some good data out of the US overnight and I'm beginning to think that there might not be any significant QE3 news come out of tomorrow's Fed meeting. Then, Monday is a public holiday in the US and Canada.

I'm at the hospital today so may not update for a while. Not that much is likely to happen anyway!

Wednesday 29/8 (6.30 pm)

Not much has changed since this morning.  Read the earlier post.

Wednesday 29/8 (7am)

The Euro had a little rally during the London session overnight. Why? Not sure but here is what FX News thought could be possible reasons:

Selling more Spanish bills at auction, perhaps the news that Draghi is skipping Jackson Hole to concentrate on the work load, and Fitch’s Riley saying the US AAA rating was in jeopardy, are cited for helping to contribute to the rally in the EURUSD. 

The indices charts are looking really interesting at the moment. The USDX is back down at the major weekly bull support trend line:

The Ichimoku cloud charts are getting very interesting too. The USDX is already out of its cloud and the EURX will emerge from its cloud soon too if the current risk on trend is maintained:

Now, some girls get excited about shopping etc but me, these charts are what is exciting me at the moment! The USDX sitting on a major support level and the E/U nearing a major resistance level:

Now, if the E/U continues on this path it will be starting to print a chart pattern that might conform to the monthly inverse H&S pattern I've been posting here for AGES! 

I'm not making predictions here at all. Market sentiment could move either way and I suspect that Friday's Fed meeting will provide momentum to kick start the move! It will just be much easier to gauge though with the USDX and the E/U at major trend line S/R levels. Exciting stuff for sure...for me at least!

The other really exciting observation for me is that the ADX and DMI lines on most charts are all below, or heading down towards, the 20 level. This will make any new trend so much easier to assess. Hog heaven for an ADX junkie like moi! Consequently, I don't have any 4 hr TS trend signals on my charts. As usual in choppy markets like these, there were some signals on the shorter time frame 30 min charts overnight. There were 60 pips possible on a 30 min TS trade on the E/U last night:

I won't be updating much here today as I suspect that very little will happen.

Tuesday 28/8 (6.30 pm)

I'm lovin' the Ichimoku Cloud daily charts on the indices!!!!!! One quick look at these charts and I can tell immediately whether conditions are right for trading or not. Kinda like weather forecasts for fishing I imagine. Anyway, these charts have taken ALL the frustration out of these choppy markets for me:

I've been spending the time charting some stocks and getting spreadsheets and assessment sheets up to date. This all kind of stalled early last year when I got sick. I think Friday might be a trigger of some sort and I'm getting ready to play it with some stocks.

Tuesday 28/8 (4 pm)

The markets are still fairly choppy and directionless. The indices are camped under their respective weekly pivots:

I still suspect that things will remain in limbo until after the Fed meet and make whatever announcement they deem fit!

I'm still watching the A/U:

and Gold:

Tuesday 28/8 (7am)

The indices continued to chop around last night:

Price action on the pairs has been rather choppy as well and I don't have any 4 hr TS signals. I, again, would have expected this given the EURX is embedded in the Ichimoku daily cloud:

The Ichimoku daily cloud on the USDX and EURX is proving to be a fantastic bell weather warning of when it is best not to trade!

Monday 27/8 (8.45 pm)

The indices are still bouncing around. I don't have any TS signals on the 4 hr charts. Not surprising  as, even though the USDX has cleared its daily cloud, the EURX is now stuck in its daily cloud:

I forgot to post these charts over the w/e. A triangle breakout might be brewing here if 'risk on' gains momentum:

Monday 27/8 (4 pm)

There hasn't been too much movement today during the Asian session but this is hardly surprising. In fact, I wouldn't be surprised if little happened all week given the Fed don't meet until Friday at Jackson Hole. This is a long awaited meeting with many holding hope for some QE3 announcement. There is actually very little scheduled red flag news on the trading calendar for this week so it could be rather aimless! The indices have little to show for their day:

Monday 27/8 (7.30am)

I am going to wait until my indices charts open and, possibly, until the European markets come on line so as to assess the direction of the USD. I was having another look at the A/U though this morning and have re-assessed this pair. The bull trend line was broken so I've had some more thoughts on this pair now and drawn in new trend lines. Price action on the daily chart looks, to me at least, like it could be printing either one of two bullish patterns: a bull flag pattern or a bullish descending broadening wedge pattern:

The A/U could still fall a bit further though and still conform to either of these patterns.

A rising USD though will most likely put downward pressure on the A/U and on Gold. A falling USD will most likely boost the A/U and Gold. Note that the USD bounced up off the weekly bull support trend line late last week:

Also, whilst logic says to me that the USD should rally relative to the Euro etc, there is currently more resistance in the path of a rising USD than a falling USD! The USD would have to battle back up through the Daily Ichimoku cloud, the weekly and monthly pivots, the 4hr 200 EMA and, also, the 82.65 level which is previous S/R if:

Remember that Gold has had a triangle breakout now but Friday's candle was an indecision Doji: 

So, I'm watching the USD, the A/U and Gold to get my pulse of the markets. Many traders are saying that the Euro should fall so they're only looking for 'risk off' trades. I have my opinions too BUT I'm going to (try to) trade what the charts tell me...long or short....

Trade Week Analysis 27/08/12

Trend trading on the 4 hr charts came back to life a bit towards the end of the week. This coincided with price on the USDX emerging from the resistance of the Ichimoku cloud on the daily chart. TS signals netted a maximum of 360 pips. I even managed to secure 100 pips! Price now has to clear the EURX daily Ichimoku if ‘risk on’ is to continue. I posted notes during the week to explain how many different trading instruments were at significant trend line break regions: S&P500, USD, Gold and Silver. It is not surprising then to see some market turbulence whilst trading at these levels.

E/U: Price broke out from the symmetrical triangle last week.  Price is heading up to test yet another bear trend line on the weekly charts; dating back 12 months to August last year!

I will look to SHORT the E/U on any new TS signal and if ‘risk off’ returns.

I will look to LONG the E/U on any new TS signal and if ‘risk on’ returns.

E/J: Price is trading within an upwards trend channel.

I will look to SHORT the E/J on any new TS signal and if ‘risk off’ returns.  The monthly pivot, previous trend line and 4hr 200 EMA are in the way of price falling though.

I will look to LONG the E/J on any new TS signal and if ‘risk on’ sentiment returns.

A/U: There is still a possible bull flag pattern in play on the monthly chart. The bear trend line of this monthly triangle pattern is about 100 pips above current price. Price could fall 500 pips though and still conform to the monthly bull flag pattern! Price has broken down through the daily bull trend line but ran in to the monthly pivot and promptly reversed.

I might SHORT the A/U if ‘risk off’ returns and price breaks, closes and holds below the monthly pivot.

I will look to LONG the A/U on any new TS signal and if ‘risk on’ sentiment returns.

A/J: Price has had trouble holding above the 83 level. The double top did indeed form as suggested last week and price promptly fell almost 150 pips after breaking the 83 level!

I MIGHT SHORT the A/J if ‘risk off’ returns and if price breaks, closes and holds below the monthly pivot.

I MIGHT look to LONG the A/J on any new TS signal, if ‘risk on’ sentiment returns and if prices breaks, closes & holds back above the 83 level.

G/U: Price broke through some significant levels last week; the daily 200 EMA and the S/R level of 1.58.

I would look to LONG the G/U on any new TS signal, if ‘risk on’ remains and if price holds above the 1.58 level.

I MIGHT look to SHORT the G/U on a new TS signal, if ‘risk off’ sentiment returns and if price breaks and holds below the 1.58 area BUT there are lots of road blocks in the way.

USD/SGD: The strong S/R level of 1.241 was too difficult to pass and price has rebounded back up from this level. I have moved the bull trend line a bit lower to reflect these new S/R levels. This means the triangle break from last week has been cancelled.

I’m not trading this pair this week...it’s been too volatile for me.

Swissie USD/CHF: Price broke down and out from the symmetrical triangle and fell almost 170 pips!

I will look to LONG the USD/CHF on a new TS signal and if ‘risk off’ returns.

I will look to SHORT the USD/CHF on any new TS signal and if ‘risk on’ returns.

Loonie:  USD/CAD: Price has now broken down below the bear trend line of a symmetrical triangle on the weekly chart dating back to October last year. This could be signal to a further 1000 pip move down if triangle break out theory holds true! Price meandered most of last week though, seemingly disturbed by this trend line break.

I will look to LONG the USD/CAD on any new TS signal and if ‘risk off’ returns.

I will look to SHORT the Loonie on any new TS signal and if ‘risk on’ returns.

Silver: Price has broken out and up from the weekly symmetrical triangle pattern and is looking quite bullish.

Gold: Price has broken out and up from the weekly symmetrical triangle pattern and is looking quite bullish although Fridays candle was an indecision style long legged Doji. A rally in the USD might cause this metals rally to pause.