Trade Spotting: August 2013

USDX

Monthly: Trend ranging / upwards. The August candle closed as what looks closest to being an indecision style ‘spinning top’ candle. The monthly 200 EMA and the 84 area continue to be resistance.

Weekly: Trend up overall. Price chopped upwards above the weekly support trend line this week. This is a major support level that has been in play since Aug 2011. The weekly candle closed as a large bullish candle.

Daily: Trend choppy/ranging. Price chopped sideways and then up this week. Price finished the week above the previous S/R level of 81.70.

Daily Ichimoku Cloud chart: Price traded below the Cloud all week but is edging up higher towards the Cloud.

4hr: Trend chopping/ranging. Price chopped sideways until Thursday. It then rallied and broke up through the resistance of the daily and 4hr 200 EMAs and 81.70 level. Price parked for the w/e at the whole number 82 level.

4hr Ichimoku Cloud chart: Price chopped in and out of the Cloud until Thursday. It then rallied up and out from the Cloud and finished the week above the Cloud. This is divergent from the daily chart and suggests choppiness.

EURX

Monthly: Trend down overall but 9 of the last 13 months have been bullish. The August candle closed as a bearish coloured ‘inside candle’. These candles reflect indecision. The monthly candle has also closed below the weekly support trend line and this is a bearish signal. This is the first candle in 13 months to close below this support level.

Weekly: Trend up, overall. Price failed to move above the monthly 200 EMA back in January. It has failed there again thus far. This level had been major resistance so it was no surprise that price had paused here. Price action had been quite parabolic for ‘risk on’ and subsequently pulled back to the mean of the support trend line. This support level has held up for the last 22 weeks but has failed to hold price this week. Price has closed out for the week below this support trend line and this is a bearish signal. The weekly candle closed as, essentially, a bearish engulfing candle.

Daily: Trend up overall. Price trended down this week though and broke through the weekly support trend line. The bearish ‘double top’ formation might just be the pattern to dominate here now.

Daily Ichimoku Cloud chart: Price chopped sideways above the Cloud to start the week but then drifted down to end in the top edge of the Cloud. This is another bearish signal. The bearish Tenkan/Kijun cross has held and I’m keeping my eye on it!

4 hr: Trend ranging/choppy: Price drifted down all week and broke through the weekly support trend line, monthly pivot and 4hr 200 EMA.

4hr Ichimoku Cloud chart: Price started above the Cloud but drifted down through the week to finish below the Cloud. This is divergent from the daily chart and suggests choppiness.

Thoughts: What a difference a week makes! The USDX has bounced off its weekly support trend line and the EURX has broken down through its weekly support trend line. These are moves that suggest a possible shift to ‘risk off’ and I’ll be watching for any follow through and signals that point that way. I say only ‘possible’ shift to ‘risk off’ because there is also the potential for the USD to rally on the back of good data and improved US market sentiment. There have been periods of this recently where the USD and stocks have rallied together on such buoyant sentiment. A ‘fear driven USD rally’ though would most likely feed into a ‘risk off’ move whereas an ‘improved US sentiment driven USD rally’ might see stocks rally but other risk instruments suffer.

Warning: The tension across the Middle East with the Syrian conflict has the potential to shift market sentiment and undermine all technical analysis.

Note: The analysis provided above is based purely on technical analysis of the current chart set ups. As always, Fundamental style events, by way of any Euro zone or Middle East based dramas and/or news announcements, continue to be unpredictable triggers for price movement on the indices. These events will always have the potential to undermine any technical analysis.

Sat 31st Aug ( 5.45 am)

Stocks are down in thin US markets ahead of Monday's US/CAD holiday. Concern about Syria weighed on sentiment. The daily support trend line is being tested again:

E/A: this signal has closed

U/J this closed for a loss:

Gold: still in its channel

Silver: ditto here

Friday 30th Aug (7.45 pm)

Gold: a bearish break building? No TS signal just yet but it is close! Further rallies with the USD won't help Gold at all:

Silver: no channel break here yet and no TS signal either:

S&P500: price is still bouncing off support for now but i'm watching out for any possible bearish H&S forming:

Friday 30th Aug (6 pm)

U/J: hasn't done too well

E/A: not too great but positive

E/J: still limping along:

Friday 30th Aug (6.45 am)

USDX: this has traded higher for the day.

EURX: this is trading below the weekly support trend line.

S&P500: bounced off the daily support trend line on the back of some good data. I know that I do tend to see a lot of 'Head and Shoulder' patterns. I actually noticed the beginnings of one possibly forming up here though. A bounce back to 1,685 and a failure to hold there would help complete this pattern. Just something else to watch out for:

S&P500: trading in the daily Cloud:

EUR/AUD: positive after TS signal but only just!

E/U: falls here but no signal produced:

U/J: gave a new signal on my 11 pm candle:

Silver and Gold: these look like more bull flags setting up BUT if the USD keeps rising then these will probably suffer so I'd be careful!

Silver:

Gold:

Thursday 29th Aug (7.10 pm): USO Call option returns 15% in one session

EUR/AUD: new TS signal here:

Thursday 29th Aug (5.20 pm): USO Call option returns 15% in one session

EURX: this index has had a 4 hr candle close below the weekly support trend line. This is a significant move down for this index as this support has held now since July last year! I'll be watching to see if the daily and weekly candle close below this level as that would be a rather bearish signal:

Thursday 29th Aug (4.20 pm): USO Call option returns 15% in one session

EURX: this is back down testing the major weekly support trend line:

USDX: this is trending up a bit:

A/U: this TS signal closed off today too:

E/U: trending down but no TS signal

Thursday 29th Aug (8.30 am): USO Call option returns 15% in one session

S&P500: I note that the daily candle on the S&P500 closed as a bullish 'inverted hammer' candle. This formation came at the daily support trend line:

Syrian related news, or lack thereof (!), will most likely drive the direction of this index over the next few days.

Thursday 29th Aug (6.20 am): USO Call option returns 15% in one session

Indices: the USD has been pretty flat but the EURX slipped down to the major weekly support trend line:

USDX 4hr

EURX 4hr

EURX weekly

Stocks bounced a little with the rise in the Energy sector. The S&P500 has bounced up off the daily trend line and Ichimoku Cloud:
S&P500 daily

S&P500 Ichimoku

E/U: dipped a bit but no TS signal yet:

E/J: signal still open for now

A/U: still down a bit

A/J: has turned off perhaps a double bottom?

E/A: TS signal has reversed and closed after giving 100 pips

Kiwi: signal has closed for -30 and is scrambling back to the weekly 200 EMA

Cable: choppy but no TS signal

U/J: this has reversed now too

Silver: paused a bit

Gold: ditto

Oil: I quoted the USO Jan 2014 $40 Call Option yesterday @ $1.79.
This is now trading @ $2.06. An increase of 0.27 cents or 15%. Not bad for one day!

Wednesday 28th (3.10 pm)

Stocks: I have updated my Stocks:Aug page here. I've looked at the S&P500, USO (the US Oil ETF) and the VIX index.

EUR/AUD: this has now closed above the key 1.5 level on the 4hr chart. Look for a daily close above this key level. The TS signal from yesterday is now up over 100 pips:
E/A 4hr

E/A daily

Wednesday 28th (2.20 pm)

Stocks: I have updated my Stocks:Aug page here. I've looked here at the S&P500 and USO, the US Oil ETF.

A/J: The weekly 200 EMA, down near 86, looks to be the next major support for the A/J.

A/J weekly

Failing this level, I'm wondering if it might then aim for the monthly 200 EMA which is also very near the previous S/R level of 84.

A/J monthly

Wednesday 28th (11 am)

Stocks: I have updated my Stocks:Aug page here.

A/U: this has fallen since the daily candle closed below the 0.90 level.

I'm wondering whether these kind of jumpy markets might be best traded during the higher volume European and US sessions.

Wednesday 28th (6.45 am)

It has been a bit of an odd night with some fear trades carrying with others not. Gold and oil are up with stocks down but some risk currencies like the E/U, A/U and Kiwi have held or bounced back a bit.

S&P500 30 min:

S&P500 daily: have fallen to just above the daily support trend line:

S&P500 Ichimoku: a breach of this trend line (above) would match a fall through the Kumo:

Oil: now this was the obvious 30 min trade of the night! No rocket science needed here!

Gold: continues higher:

USDX: this, surprisingly, has drifted back down!

EURX: this, surprisingly, has held!

The TS signals have had mixed results so far:

E/U: no signal here and price even rallied up to the 1.34:

E/J: this signal is up 70 pips

A/U: this signal is down 20 pips. Some traders will be watching for a daily candle close below the 0.90 level and, then, look to short from there:

A/J: has trended down

E/A: signal also down 20 or so pips as price moves up towards the 1.5 resistance level;

G/U: no signal here and not much movement:

Kiwi: much like the Aussie. TS signal down about 30 pips:

U/J : this gave a TS signal on my 11pm candle:

AUD/NZD: still holding out from the possible flag break:

GBP/AUD: signal down 80 and the worst of the lot!

There seems a mixed 'risk off' response with the most usual risk sensitive pairs rallying! Also, the fall with the USDX has me perplexed but might be due to drag with the U/J. Hmmm. I'm going to mull this all over a bit more on my morning walk.

Tuesday 27th Aug (7.30 pm)
E/J: new TS signal

Kiwi: new TS signal here too

AUD/NZD: bull flag?

TS signals building on the U/J and Cable

Tuesday 27th Aug (6.10 pm)

I am seeing what looks like some fear based 'risk off' trade which I assume has been triggered by events in Middle East with Syria. This 'fundamental' based event could prove to be a 'game changer'. I'm expecting more TS signals on my 7 pm candle close if this sentiment keeps up.

USDX: up a bit

EURX: falling

S&P500: selling off in pre market

FTSE: down

Gold: rising with flight to safety perhaps

E/U: falling too even with some good data just now

U/J: down with Yen strength

E/J ditto

A/J ditto

Cable: trend line break here:

Kiwi: falling now too:

Tuesday 27th Aug (3.30 pm)

AUD: has continued to slide and has triggered some TS signals on my 3pm candle close:

A/U:

EUR/AUD

GBP/AUD

AUD/NZD: still falling but no clear TS signal formed here in time:

Tuesday 27th Aug (12.30 pm)

AUD: this has slipped this morning but I don't have any TS signals here yet:

A/U: back below the 0.90

A/J: back below the 89

E/A: nudging up to the 1.5

AUD/NZD: a lot of traders are bearish on this pair. It is still pulling back after making a bullish close last week BUT there isn't much momentum here, either way. No TS signal here yet.

GBP/AUD: this pair hasn't done too much over the last few weeks but neither has the GBP/USD. A daily trend line is still supporting price on the daily chart. Like the saying goes though...'what goes up must eventually come down'.

E/U: doing nothing:

Tuesday 27th Aug (5.45 am)

It seems there was just mostly more sideways chop overnight. The indices have chopped sideways, stocks slipped a bit but the metal traded higher:

USDX

EURX

S&P500: still above the daily support trend line

S&P500: still above the Cloud but there is that weak bearish Tenkan/Kijun cross signal:

Silver: the bull flag might still be on here:

Gold: ditto here too!

E/U: chopped sideways

E/J: trading near flag breakout

A/U: holding above the 0.90

A/J: hanging near the 89

EUR/AUD: sideways

G/U: ditto

Kiwi: above the weekly 200 EMA

U/J: probably one of the more interesting pairs at the moment. It is trading just under a flag breakout trend line and the monthly pivot and just above the weekly pivot:

U/J 4hr

U/J daily

U/J daily Ichimoku: trading just under Cloud area

U/J monthly Ichimoku: now this is the interesting chart. Will price break through the Cloud or will the Kumo prove to be too much resistance?

AUD/NZD: price has pulled back a bit here. This isn't too surprising as price was outside the Bollinger bands:

I don't have any new TS signals yet.

Monday 26th Aug (7.30 pm)

U/J: this signal closed off too:

Monday 26th Aug (6.40 pm)

It has been a fairly quiet Asian session and there is a Bank Holiday in the UK so the action may not get going, if at all, until the US session.

Indices: There hasn't been too much movement on these just yet. What little movement there has been has been more 'risk off' in nature though.

USDX: I have adjusted the weekly support trend line a bit to capture the latest low moves here. The trend line has edged down just a bit. This is really only noticeable on the 4hr chart though:

USDX weekly