Monday, January 20, 2014

Trading Week 20/01/14

Sat 25th Jan (6.30 am) 

NB: I am away and charts are difficult/slow to load. I will try loading them again later. 

Indices: The USDX is struggling to hold above the support of the weekly 200 EMA but the EURX has held above its support trend line too after bouncing up from this this yesterday:

S&P500: The 'double top' looks like it might be taking a grip as the index is down and it also gave a great 30 min short overnight.

TS signals:
GBP/AUD: closed now but moved 350 pips.
E/U: flat:
A/J: moved 300 pips.
U/J: 130 pips.
EUR/AUD: 330 pips.
AUD/NZD: flat

New TS signal: 
E/J: this has also now broken the neck line of the daily chart H&S pattern and looks set to close below this.

A/U: this has looks now to have a second weekly close below the 0.89 'neck line' of the weekly chart H&S and, thus, would seem to confirm this pattern.

Cable: has tested the monthly 200 EMA but has been rejected for now.

Fri 24th Jan (7 am)
Cable: this is approaching major resistance in the form of the monthly 200 EMA. A continued slide with stocks and risk sentiment there may end up dampening enthusiasm with the Cable move BUT, this is a key level to watch. A break and hold above the monthly 200 EMA would be very bullish and might allow for an entry point to long. Obviously, respect of this monthly 200 EMA S/R level might suggest a bearish move might be on the way, even if only short term:

Cable 4hr:

Cable monthly:

Now, I'm off for one last swim before hitting the dirt!

Fri 24th Jan (6.30 am)
Indices: there were some big moves here overnight; ones that started during the European session. The USDX is back down at the weekly 200 EMA. This S/R level has been like a magnet for this index!

EURX: has bounced off major support:

S&P500: stocks are lower, even though the USD has weakened, due to concern about Chinese growth following the weaker manufacturing data from yesterday. 

I have been wanting a pull back here for some time. I'm hoping this move will deliver this:

Open TS signal:
GBP/AUD: has given 170 pips:

Gold: put in a huge effort overnight and has rallied up over the bear trend line AND the neck line of the bullish 'inverse H&S' pattern. A close above the $1,255 neck line would be a very bullish signal: 

Silver: not as perky as Gold:

Currency pairs:

New TS signals: there were many new TS signals overnight with these moves on the indices. Some of these have already made substantial moves and I won't be chasing them:

E/U: signal off my 1 am candle after the triangle break:

A/J: off my 9 pm candle: Price is now down near the trend line from the daily channel

U/J: off my 5 am candle BUT this followed some big candles so I'm cautious:

EUR/AUD: off my 9 pm candle. Note the close above the key 1.56 level! 

AUD/NZD: off my 5 am candle and also after a triangle break:

Cable: the triangle break has yielded 170 pips but, sadly, this move did not trigger a TS signal:

A/U: down with the poor Chinese data. Would probably be lower if not for the moves with Gold! No TS signal here: 

Kiwi:I'm surprised this isn't lower given the state of the S&P500:

E/J:  dragged down by the U/J:

Ichimoku: The Ichimoku charts were close to alignment for long USD yesterday but now they are close to alignment for short USD.

I am away for this w/e: I'm swapping my swimming costume and towel for boots and jeans as we head to a country music festival. 

Thurs 23rd Jan (7.30 pm)
Indices: that Ichimoku 'risk off' alignment might be short lived. The USD is tumbling after some positive EUR data:

EURX: getting a bounce off major support: 

GBP/AUD: helped by data: 

E/U: making for a triangle break: 
E/J: ditto:

Cable: higher now too: 

EUR/AUD: remember...I said to watch for any bullish break above the 1.56:

Thurs 23rd Jan (4 pm)
Ichimoku Alignment: The Ichimoku charts slipped into 'risk off' alignment today. This is of more interest at the moment given that the EURX is still testing a major support level:

USDX: The USD index is trading above the Ichimoku Cloud on both the 4 hr and daily time frames:

USDX 4hr:

USDX daily:

EURX: the Euro index is trading below the Ichimoku Cloud on both the 4 hr and daily time frames:

EURX 4 hr:

EURX daily:

Previous periods of alignment like this have sometimes resulted in significant trend periods of 'risk of' style sentiment. Classic style 'RORO' moves have not been as evident over recent times but I just thought I'd mention this alignment anyway.

I am also watching the EURX as it tries to avoid going 'over a cliff' as it struggles at a major support trend line that has been in play since mid 2012. A breach of this level could well tip general sentiment into risk off for sure. Price is already back below the other support of the monthly 200 EMA:

EURX 4 hr:

EURX monthly:

Thurs 23rd Jan (1.50 pm)
EUR/AUD: this has now closed off:

GBP/AUD: this gave a new signal after my 1 pm candle close: 

Thurs 23rd Jan (9.45 am)
Gold: Gold has been trading under a bear trend line for the last few weeks and has continued to respect this again this week. This trend line is close to the neck line of the potential inverse H&S pattern now too making for interesting charting and analysis. 

Gold weekly: 

Gold daily: The bullish inverse H&S could still be forming up on the daily chart. The left hand shoulder took a couple of weeks to form up and the right hand shoulder could still be forming up here too. Another bullish run on the USD could halt this though. 

Gold 4 hr: there have been higher 'highs' and higher 'lows' here over the previous 3 weeks but price has chopped more sideways this week as it trades under the resistance of the neck line and bear trend line:

It seems, to me at least, that Gold, and Silver, seem to be hanging around near key levels in the slim hope that any US QE taper might be slow paced or even delayed. If so, I would not be surprised to see them rally and,  possibly, rally hard.

Thurs 23rd Jan (8 am)
Loonie: I don't trade the Loonie and I even gave up charting it but there has been so much talk about it lately that I pulled up a chart to have a look. The monthly chart with the Ichimoku Cloud is rather revealing. Price has not traded above the monthly Cloud since back in Jan 2003 but it is poking it's head up there now and, no doubt, testing the quality of the air up there. A monthly close above the Cloud would be quite a bullish signal and suggest it might try and march up to the 61.8% fib level in the 1.34 region. The 38.2% fib and monthly 200 EMA will offer some resistance on this path though:

Thurs 23rd Jan (6.40 am)
Stuck: Think back to when you've been stuck in a road block on a highway; trucks, cars, caravans etc and you eventually find it was just one vehicle causing the mayhem. That's kind of how I'm viewing these markets. The one vehicle causing the blockage, as far as I'm concerned, is the S&P500:

This index is stuck in a potential 'double top' region but price could head either way from here. I see the choppy sideways action across other instruments as being held up by the same sentiment that is holding this index in check at the moment. I really think we're going to need to see a decisive move on stocks, either up or down, before we'll see too much move elsewhere....IMHO!

USDX: chopppy

EURX: trying to avoid the cliff still! 

TS signals: only one at the moment:
EUR/AUD: gave 60 but choppy:

E/U: triangle bound: 
E/J: ditto:
A/U: didn't get too far:

Cable: the triangle break ended up yielding 130 pips but without triggering a TS signal as the move was too slow: 
U/J: choppy:

AUD/NZD: not much here either:

Wed 22nd Jan (7.30 pm)

EUR/AUD: had a new signal after my 5pm candle:

GBP/AUD: a signal trying to build here too:

Not a lot of confidence elsewhere yet though.

E/U: triangle bound still:

E/J: ditto:

A/U: watching for any reaction at the 0.89 'neck line':

U/J: still building a possible inverse H&S here:

Wed 22nd Jan (12.15 pm)
A/U: positive CPI data has lifted the AUD and helped the Aussie. I would expect a target of 0.89 for sure but maybe even up to the congested zone of the monthly pivot, 4hr 200 EMA and 61.8% fib level:

Wed 22nd Jan (9 am)
S&P500: still loitering in the 'double top' region:

I do note that AA is now at $12.13! I have been stalking this for ages and suggested to watch for any break over $11. It is up over 10% in less than a week!

Wed 22nd Jan (6 am)
EURX: My 'risk barometer'. I mentioned in my 5.40 am update about how the EURX is precariously situated at the moment and trying to avoid going over the proverbial 'cliff'. I thought I would update all of the EURX charts to illustrate this point:

EURX monthly: A triangle pattern has contained price since mid 2012, a period of about 18 months. Price broke above the major resistance level of the 200 EMA in November and this support held for December. Price is back struggling to hold above this level for the January monthly candle though:

EURX weekly: you can see how price reached up very close to the 61.8% fib pull back of the 2008-2012 huge bear move. This fib level is another major hurdle for the EURX and it has backed away from this for the time being.

EURX daily: the support trend line was tested last November and held but will it hold again this time? 

EURX 4hr:  the index is sitting right at a major support junction of the 200 EMA (green line) and the major support trend line. I have explained, on many occasions, how I see the EURX as a kind of barometer or pulse for general 'risk appetite'. Thus, I would suspect that a breach of this support would trigger a major 'risk off' style move. A decided bounce, though, could trigger more of a 'risk on' style move.

I'm watching this index closely and will wait to trade further, with both stocks/option and FX, until there is a clearer picture about which way momentum will move from this junction.

Wed 22nd Jan (5.40 am)
S&P500: this chart kind of sums up things in general at the moment:


EURX: trying to avoid going over a cliff! 

U/J: short but not sweet and closed off for -60 BUT ahead of BoJ so was not a sensible trade anyway: 
E/U: triangle bound: 

E/J: ditto:

A/U: chopping around the 0.88 level: 
A/J: choppy:

Cable: has broken up from the triangle pattern BUT no momentum with it just yet: 

Kiwi: choppy:

AUD/NZD: ditto:

GBP/AUD: ditto:

Silver: trading lower and has backed away from taking on the trend line. The 30 min charts gave a reasonable trend during the US session: 

Gold: ditto:

To me it feels like something big is brewing but I have no idea what it will be or which way sentiment will head. I'm watching the Euro index closely as it seems to be trying to avoid going over a cliff and , thus, looks the most vulnerable at the moment. Having said that, though, this EURX support could hold and prove to be a platform for a bounce. So, as stated, I have no idea what the next direction will be and will wait for momentum to pick up across a great number of pairs and, then, tag along when a new trend emerges.

Tuesday 21st Jan (9.45 pm)
U/J: I have a new TS signal here on the 4hr chart. There has also been a bullish cross on the Cloud chart. Beware though as BoJ monetary policy tomorrow:

AUD/NZD: a signal is trying to build here: 

GBP/AUD: ditto:

Tuesday 21st Jan (5 pm)
EURX daily Cloud: price action still stuck in the Cloud:

U/J: the bear candle voided the TS signal here:
E/J: ditto here:

Tuesday 21st Jan (3.30 pm)
Gold: this signal has closed off now and the daily candle didn't end up closing above the key $1,255 'neck line':

Kiwi: no new TS signal here yet, in spite of good NZD data:

E/U: still chopping around:

Asian markets are up today and the Nikkei is higher as well. The Nikkei's running partner of late, the U/J, seems to have joined in.

U/J: this will most likely trigger a new TS signal at the 5pm candle and is currently testing the inverse H&S neck line: 

The 'Holy Trinity alliance' looks on again as the S&P500 is up in pre-markets too:

E/J: this is starting to look bullish again. The 'Bull Flag' option may be the one to evolve here!

A/U: check out the Bollinger bands here:

Cable: still chopping too:

Tuesday 21st Jan (9.50 am)
Kiwi: A stronger than expected NZD CPI result has lifted the Kiwi and closed off the TS signal for -60:

Updated trend lines on Kiwi daily chart:

Kiwi Video: This video just came in from Dean Malone of Compass FX. I note that he has the same bull flag pattern on his monthly chart that I have:

Tuesday 21st Jan (7.30 am)
E/J: I wrote about this pair in detail last w/e and about how there could be a possible bearish H&S setting up on the daily chart and how any pull back would tie in nicely with the monthly Ichimoku Cloud. This deeper pull back may not evolve though and it may turn out that a pull back to the major S/R level of the 61.8% fib of the 2008-2012 bear move is all we will get. 

What then? Well, I'll watch for new TS signals but, also, for any possible bullish trend line breaks as well. The daily chart, whilst currently looking a bit bearish and H&S like, could also be just another big 'Bull Flag' setting up. I have drawn in a new bear trend line on the 4hr chart and I'll be watching for any bullish breaks up through this to suggest a 'Bull Flag' or for bearish breaks below the 61.8% to suggest a 'H&S'. A TS signal with either break would help for added confluence:

E/J monthly:

E/J monthly Cloud: the H&S pattern would help to support a pull back to test the top of the monthly Cloud:

E/J daily: A bearish 'H&S' or a 'Bull Flag'? Hopefully trend line breaks will help here:

E/J 4 hr: note the new bear trend line here. I'm hoping that a break of either the bear trend line or the support of the 61.8% fib level will offer some guidance here as to the next major move:

Tuesday 21st Jan (6.40 am)
Indices: The USDX has remained weak and has tested the broken resistance level of the daily 200 EMA:

EURX: this has found support from the major monthly support trend line as the 4hr and daily charts show:

Closed TS signals: some positive Chinese data lifted the AUD, and risk appetite in general, although the USD holiday moderated the impact of this somewhat:

GBP/AUD: closed after giving 380 pips:

A/U: closed after 200 pips.

E/U closed for -40.

E/U daily: the daily trend line was broken here BUT there is a new shorter term daily trend line offering support at the moment and this is part of a symmetrical triangle. I have drawn this in pink to make it easier to see:

Open TS signals:
Kiwi: not doing much though:

Gold:  I had noted yesterday that although the 'neck line' at $1,255 was being tested on the 4hr chart that we would need to see a daily candle close above this key level to consider the formation of the inverse H&S pattern. Price is just below this level at the moment so may not trigger this just yet:

 Gold  4hr
Gold daily:

E/J: still holding above the key support of the 61.8% fib:
 E/J daily:

U/J: still forming up into an inverse H&S.  

Cable: still chopping around within the confines of the triangle:

AUD/NZD: not much going on here either:

Silver: is testing the triangle trend line:

Silver daily:

Sadly, for me, there is more action in my house due to school holidays than with these markets so I'll be leaving things be until there is more momentum! I did attend an interesting trading talk last night and will note this up later on in my 'Stocks' section.

Monday 20th Jan (1.35 pm)
Indices: The USDX has opened cautiously this week and may want to test the broken daily 200 EMA before it considers any possible further advance:

EURX: is trying to hold above major support and succeeding for now. The reasonable Chinese GDP data helped here: 
Open TS signals:

A/U: getting a bit of a bounce out of the positive Chinese data and this may close off the current signal but not just yet:

Gold: has now had a 4 hr candle close above the neck line of the H&S BUT this is a daily chart pattern and we'd need to see a daily candle close above this to be even hopeful here:

E/U: holding for now and got a bit of a boost from the positive Chinese data:
Kiwi: ditto:

GBP/AUD: might close off soon but hasn't yet:

E/J: has bounced, yet again, off the 61.8% fib of the 2008-2012 bear move:

Cable: choppy:

U/J: choppy too:

Silver: looks like it might head to test the triangle trend line again:

The USD holiday might keep things quiet. 

I'm out at a trading meeting this afternoon and evening.

No comments:

Post a Comment