Trade Week Analysis 10/09/12

This week's Trade Week Analysis contains an FX and Stocks/Options section.

FX: Up to 580 pips possible this last week!

Trend trading was great this last week as both indices emerged fully from the congestion of the Clouds on the daily Ichimoku charts. TS signals were received on the following pairs and are still running: A/U up 150, E/J up 130, A/J up 100, USD/SGD up 100 and the Loonie up 100. The running tally is at 580, counting the poor Loonie which i over looked earlier!

E/U: Price broke through the bear trend line on the weekly charts that dated back 12 months to August last year! That bullish monthly inverse H&S pattern seems to be playing out too! The daily 200 EMA is just above price and might be a problem for this pair.

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

I am LONG the E/U based on the trend line break.

E/J: Price is trading within an upwards trend channel and nearing the upper trend line.

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 the new TS signal, if ‘risk on’ sentiment remains and we get a break out of the trend channel.

A/U: There is still a possible bull flag pattern in play on the monthly chart. Price is currently trading within a bullish descending broadening wedge pattern. Note how price bounced off the bottom trend line this week!

I might SHORT the A/U if ‘risk off’ returns and price breaks, closes and holds down below the wedge trend line.

I am LONG the A/U.

A/J: Price broke out from trading within a downward trend channel this week and gave a TS signal as well.

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

I am LONG the A/J. 

G/U: Price has held above the daily 200 EMA and the S/R level of 1.58. Price has trended up late in the week but I didn’t get a TS signal.

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: Price has just broken down from trading within a symmetrical triangle on the weekly chart. There is a TS 'short' signal in play on this pair already.

Swissie USD/CHF: Price is trading down under a bear trend line and just above the daily 200 EMA. A TS short tried to form up on Friday.

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 the new TS signal, if ‘risk on’ remains and if price breaks, closes and holds below the daily 200 EMA.

Loonie:  USD/CAD: The weekly bull trend line was broken this week and a new TS 'short' signal was received.

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

There is a short TS signal on the USD/CAD already.

Silver: Price has broken out and up from the weekly symmetrical triangle pattern and is still looking quite bullish. Price is up 400 pips since the TS signal!

Gold: Price has broken out and up from the weekly symmetrical triangle pattern and is looking quite bullish too. Price is up 800 pips since the TS signal!

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Stocks:
The S&P500 is starting to look a bit bullish. The +DMI is heading up, price has broken out of a long term triangle pattern and is heading towards the upper trend line of a recent trading channel:

I'm going to wait to see if this upper trend channel can be broken before jumping into more Stock or Option positions. I suspect any break on this S&P500 channel might coincide with the looming trend line break on the EURX index.

This is no coincidence at all. Both of these levels need to be broken to allow for continued  traditional 'risk on' momentum. By 'traditional' I mean 'a falling USD along with rising stocks'.  This is a common correlation for these two instruments. These levels could also prove to be strong resistance and result in a turn back to 'risk off' though. That is why I'll be watching both of them closely!

• Update on current open positions:

FCX:  Cost basis= $32.43. Trading at $40

WU:   Cost basis = $16.38. Trading at $18.15

AVP:  Cost basis = $15.57. Trading at $15.99

GE:    Cost basis = $20.29. Trading at $21.59.

SWY: Cost basis $18.30 Trading at $16.32. The only dud so far!
KO:    Sold Nov $38.75 Put Cost basis= $38.08 Trading at $37.90

• Update on charts/trade ideas posted last week: I haven't got into any of these option trades yet. Hope to have some time to do so this week.

DGS up $1.18 to $45.82

GDX up $2.53 to $50.46 !

GLD up $4.13 to $168.44 !

IAU up $0.41 to $16.91

GWX up $0.83 to $26.78

IYT up $2.34 to $90.72 !

SLX up $3.91 to $45.34 !

KBE up $0.81 to $23.51

USO up $0.31 to $35.88

I'm also looking at SPY Calls based on the S&P500 charts above.

I'm liking the look of this chart too: XME Metal S&P; Mining ETF

I'll update in my 'Stocks: Sept' page when, and if, I take any of these trades.