Monday, June 17, 2013

Trading Week 17/06/13

Friday 21st (3 pm)
The USDX is still holding up off support yet the EURX is still managing to hold above the 108.5 support:

Something has to give sooner or later.

E/U: this is still holding above the 1.32 for the time being at least:

A/U: this is still holding above the 0.92 level

BTW: I head off tonight for 3 weeks but will update when I can.

Friday 21st (8 am)
EURX: I'm trying to make some sense and find some correlation among the various indices etc. There is clear 'risk off' for stocks but this isn't so clear just yet with currencies. Yes, the USD index looks bullish as it has bounced off weekly support BUT the EURX is printing its own bullish patterns too. The weekly EURX has had a bullish 'inverse H&S' pattern printing for some time now and I have posted about this over recent weeks. The daily chart now also looks to be forming up into a bullish ascending triangle pattern. I have enhanced the trend lines here to illustrate this formation. These technical patterns are, more often than not, bullish continuation patterns:

Friday 21st (7 am)
Stocks and Gold/Silver tumbled further overnight but the same risk aversion didn't accelerate with currencies. The USDX has stalled at the 4hr 200 EMA which also happens to be the 38.2% fib retrace level from the latest swing high:

EURX: this is down but still above the key 108.5 level for the time being. 

USDX Cloud: price on the USDX is above the Cloud on the 4hr chart now. We may end up seeing a shift back to alignment for 'long USD' BUT we're not there yet with the other index Cloud charts:

Stocks: the daily trend line has now been broken and this is a bearish signal for sure. I notice that price is right at the bottom edge of the Ichimoku Cloud though. This can act as support so I'd be waiting to see price emerge from the Cloud before being too confident shorting this index:

S&P500 30 min: this gave a trade off the 30 min charts during the US session and would have been another great low risk high profit trade on the SPY: 

Gold/Silver: these have tumbled as though. Gold has broken through the $1,300 support and I think next stop could be $1,000 then $850!. Gold gave a great 30 min trade during the London /US sessions:
Gold 4hr
Gold 30 min:

E/U: this did give a TS signal last night BUT I'd wait to see a close below the 1.32 support though:

E/J: Signal has given 200 pips and price bounced back down from the trend line and 130 area: 

A/U: is trying to hold it together above the 0.92 level. Signal has given 300 pips: 

G/U: this short was avoided as price failed to close below the 4hr 200 EMA:

U/J: price bounced off the trend line and 4hr 200 EMA
EUR/AUD: up 380
GBP/AUD: up 170 

The lack of risk aversion follow through with the currencies make me suspect of the bearish moves on stocks. After all, it is good news that has triggered this move on the USD and I will wait to see how this continues to be translated.

I'm still having trouble loading my charts so may not update much today.

NB: I head to the US tonight for 3 weeks so further updates will be less frequent and brief.

Thursday 20th (4.40 am)
I am not able to load charts at the moment.

S&P500: this is pushing down towards the support of the daily trend line.

New TS signals: I have had a new signal on the Cable although I'd wait for a close below the 4hr 200 EMA. Also on the GBP/AUD.

Current TS signals are at: E/J=100, A/U = 240 and EUR/AUD= 340.

I hope my software recovers later on!

Thursday 20th (6.50 am)
CNY: there is some red flag Chinese data out in a few hours. This could help the Aussie a bit if it comes out positive. The poor Aussie has been slaughtered in the wake of FOMC.

I'm travelling home from interstate today and will miss this release.

Thursday 20th (5.40 am)
There have been extreme reactions across the markets to the latest FOMC news that hinted that tapering of QE might start later this year. The USDX has rallied off support whilst the EURX seems a little unsure which way to head. This is the case of good news being translated as bad new BUT, 'for how long this conundrum holds' is the question!

S&P500 : down but support in tact for the time being

S&P500: the Ichimoku Cloud is holding for now as well

Gold 4hr : triangle breaking down

Gold monthly : maybe we will see the $850 reached!

Gold Ichimoku: watch out if this Cloud is breached....

Silver: this looks certain to hit $15 now that the monthly Ichimoku Cloud has been breached:

E/U: trend line broken now waiting for any new signal.

A/U: earlier signal is now up 170 pips
G/U: as for E/U
EUR/AUD : signal is up 220 pips


AUD/NZD: maybe this was a bear flag then?

We now have the situation where good news (tapering imminent due to perceived improved economics) being translated by the markets as 'risk off' or risk aversion. Surely though this is good economic news though and worthy of a different response! We will have to wait and see if this latest stock rally really was an artificial 'bubble' that has now been burst or, whether, reality will kick back in an we see a new paradigm where the USD might rally along side stocks. I wouldn't be shorting stocks until there is a clear break of the support trend line and Ichimoku Cloud.

Wednesday 19th (10 pm)
The indices haven't moved too far:

A/U: conforming to the triangle
Kiwi: ditto
A/J: sitting on the 90 level
U/J: sitting on the 95
GBP/AUD: conforming to the triangle 
Gold: conforming to the triangle

Wednesday 19th (7 am)
FOMC: I've been giving some thought to who might be the winners and losers out of FOMC. Gold came to my mind. Any continued falls in the USD just might help to boost Gold and other commodities.I had it trading in a triangle on the 4hr chart yesterday but price broke through this and gave a great 30 min chart trade during the London and US session:

Gold 4hr: smaller triangle break yesterday:

Gold 30 min: great 30 min chart trade:

I then stepped out to look at Gold on the daily chart and have drawn in trend lines to reflect recent support and resistance. Price action seems to be forming up into a triangle here too. I'll be watching these levels as FOMC unfolds. This might have implications for resource based stocks then too.

Gold daily: FOMC might trigger a breakout here:

Wednesday 19th (6.30 am)
Indices: these are currently now back into an alignment for 'risk on'. I'll be waiting until after the FOMC release though to see if this alignment holds. Any further 'tapering' bias might see the USD bounce from this weekly support and this would most likely reverse the alignment to one of 'risk off'. This would be a clear case of 'good news being bad news'; bad for 'risk' in the short term at least I would suspect:

USDX: below the Cloud on the daily and 4hr

EURX:  only just now back above the Cloud on both the daily and 4hr 
USDX: still in 'planking' mode

EURX: still above 108.5

E/U: trend line holding but no TS signal yet: 
E/J: gave a signal on my 3 am candle:

A/U: back to hiding near the 0.95 cents. This could move very sharply either way after FOMC.

G/U: a trend line break BUT no TS signal. 

Kiwi: a bit like the Aussie

U/J:  a trend line break BUT no TS signal. 

GBP/AUD: back to the 1.65 level

I think any technical analysis is rather moot in the lead up to FOMC. Much interest is being vested into this announcement the results of which will most likely set the course for the next momentum move. Trying to predict the outcome from this point though is more like gambling. Stocks seem to be thinking that the talk of easing might mute a bit and seem to have jumped out into the 'risk on' alignment:

S&P500: the Bull Flag looks to have evolved here BUT FOMC will impact here for sure so I'd be waiting before loading up, either way:

Tuesday 18th (9.30 pm)
U/J: Has given a trend line break and is trying to form up a signal:
E/J: ditto

A/U: gave a signal on the 7pm candle close

G/U: a trend line break but no TS signal just yet:

GBP/AUD: no new signal here yet though:

EUR/AUD: zooming along

Tuesday 18th (6.20 pm)
EURX: this is having a bit of a run and is tipping the indices back int 'risk on' alignment:

E/A: this signal is now up 120 pips!

GBP/AUD: I'm waiting for GBP 'red flag' news due out in a few mins.

Tuesday 18th (3.30 pm)
USDX: I thought this would trade flat until FOMC and it looks like this is the case:

EUR/AUD: a new signal here: 

GBP/AUD a signal building here: 

Tuesday 18th (6.15 am)
The USD continues to drive markets.
USDX: still flat lining above support

EURX: trying to break upwards. Back above the key 108.5 again 

Stocks: chopped around amid more 'tapering' speculation

E/U: trying to rally or a double top forming? 

A/U: very choppy. Signal now closed for 100 pip loss
G/U: grinding higher 

Kiwi: very choppy. Signal now closed for 60 pip loss 

U/J: not doing too much at all before FOMC

I still think it's wise to wait until after FOMC to see how the news, whatever it is, is digested and interpreted by the markets.

Monday 17th (8.50 pm)
I'm just back from a night at my 'alma mater'...Sydney University.

I see that the USDX is 'planking' on the 50% Fib and the weekly support trend line:
E/U: poised

S&P500: markets up in pre-market

Monday 17th (4.20 pm)
These long signals from last week are back in healthy status:

I'm keeping an eye on this one too:

Monday 17th (2.20 pm)
There hasn't been a whole lot of movement so far this Asian session. I really do think that it will take until Wednesday's FOMC before we see much action.

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