DOW JONES The opportunity to buy again is NOWWe have been following this Triangle pattern on Dow Jones (DJI) trading within what we called the 'High Volatility region' since last year, with are last buy signal given 1 week ago:
The 33400 target was reached and yesterday's rejection on the 4H MA200 (orange trend-line) is providing us with a new opportunity to buy. We have a confirmed Triple Bottom ranging from November 09 2022 and today's low makes a Higher Lows sequence similar to what followed after the December 20 2022 Low on the 32480 Support. Even the 4H CCI is on the exact same levels as December.
Target 1 is again 33400 and Target 2 is 34350 assuming the index breaks and closes a 1D candle above the Pivot Zone and then re-tests it successfully as a Support.
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Djia
The Follow-Through, 8 Mar 2023🖼 Daily Technical Picture 📈
➤ Equity prices ended the day sharply lower. It was either this or the other way round. I hope you chose the right side. I'm still sidelined.
➤ It's not all bad being sidelined. I get to think and write more in regards to my insights into markets and their behaviour.
➤ As I said, NO trade was triggered today. It was close. Now I await the "follow-through". I'm pretty fond of that term because it first resonated with me through watching one of my favourite sports: Cricket.
➤ The "follow-through" action of a Fast Bowler in Cricket is very important. It's the ending action after the ball is released. It's vital for a Fast Bowler who steams in at great pace to have a smooth ending action in order to direct the ball as s/he wished, reduce chance of injury and not to be penalised for running on the pitch. It's all a bit technical but it's very important.
➤ A follow-through is just as important when it comes to market movement. It is important for the Bears to see a continuation of today's action tomorrow. Without a proper follow-through, this down move will be reversed easily. That's what I'll be looking out for tomorrow.
➤ Conclusion: A good follow-through to the downside would almost certainly see me leave the sidelines and become a short-term Bear.
NOTES: all price gaps have been closed. VIX did not explode higher as it should have.
Strange Happenings, 7 Mar 2023🖼 Daily Technical Picture 📈
➤ Equity prices ended the day flat after the initial Bullish momentum carried over from last week. Strange was the out-sized relative underperformance of the Russell 2000 small cap stocks. It sold off quite aggressively. What's a plausible explanation? Interest rates? Maybe it was just one of those days...
➤ BTW, I forgot to mention this: Last Friday was the 10th CONSECUTIVE Friday that equities ended the trading day with a green candle i.e. higher close than the open. What's with this pattern of events? What will happen this Friday?
➤ I don't read too much into today's price action. It maybe some anxiety with upcoming economic data and blabbering Fed mouths. It isn't a reliable signal to say if prices will reverse lower or it was just a temporary pause in upward momentum.
➤ Conclusion: It's 50/50 on the direction of the next trade. Market is leaving me guessing.
Dow Jones by EOY
Based on fundamentals, economics, economic data, geopolitics, Fed QT. It'll be a zig zag on the way down. S&P completed a 50% retracement during this last 5-week rally. The trend seems to have reversed with a resumption in selling that started in Nov 2021, accelerated in Jan 2022, with a recovery in June to Mid August.
Marching Higher? 6 Mar 2023🖼 Daily Technical Picture 📈
➤ My current view of equity markets is based on today's chart colour scheme. Green and a bit of grey.
➤ With a strong rebound higher in markets over the last couple of trading days, I think things look pretty Bullish. The trend from the October 2022 bottom is Bullish. It is a series of higher highs and higher lows. The classical definition of an uptrend.
➤ It looks like the Sellers have dried up. All the selling has been absorbed by the Buyers. Everything pretty much adds up to the Bullish tone.
➤ The only grey is the price structure that I look at (my secret sauce) remains not so clear. There is not yet a trading signal for a BUY and there is still a reasonable possibility to go SHORT.
➤ How prices evolve this week will almost certaintly settle the case and we should see a trade soon enough. 🤞
➤ Conclusion: Looks can be decieving. 🥸
Dip Dip Dip...Is it Done? 3 Mar 2023🖼 Daily Technical Picture 📈
➤ A massive reversal of fortunes as the dip buyers show their hand. Is it the end of the short-term downtrend from the 2nd Feb high?
➤ The honest answer to that is I have no idea and no one else does either. We can only assign probabilities as to what may happen next. That after all is what Trading and Investing is all about. Making a sound judgement and then backing that up with money.
➤ With the current scenario, it is completely unclear to me as to how prices will evolve. That is why I haven't put on a position. That is why my Strategy hasn't given a trading signal.
➤ Today's price action builds on the scenario that I outlined yesteday. That is the Bullish scenario as explained by the abscence of strong selling pressure. I described it as the "drip drip drip" of small downward movements. The large Bullish intention of today's move could mark the end of the drip.
➤ However, there are many complications. One of which is how price resolves itself around the 200 day moving average. It is hanging around there like a bad smell.
➤ Conclusion: Trading is about discipline. We are not forced into a trade, it is a choice. There are good and bad choices.
Drip Drip Drip... 2 Mar 2023🖼 Daily Technical Picture 📈
➤ Another down day to start off March. You can see that prices have trickled down slowly drip by drip since the Feb 2 high. It feels like a death by a thousand cuts. Not enjoyable for the Bulls nor satisfying for the bloodthirsty Bears.
➤ It's certainly different to the drops in the past year where they have been fast and furious. This has two potential meanings:
❶ There's a lack of strong selling
❷ There's strong selling still to come
➤ In the first case, the behaviour says that the Bulls will eventually win out. They are absorbing whatever level of selling there is. Bears will exhaust themselves ending in an inevitable levitation in price (perhaps a fast one since there are no more sellers).
➤ In the second case, the dumb Bulls are buying the dip. As a more clever Bull you have the knowledge that there are more sellers than buyers. In order to exit your buy positions at the best price you exit with care, drip by drip. Until at some stage, the dumb dip buyers run out and then the drip feed becomes a selling waterfall as the Bears come to feed.
➤ Conclusion: These are the types of games the big players play. I don't really care for either explanation. My only care is that I grasp this opportunity to make money.
DOW JONES This is the bottom. Fractals from 2022 confirm.Not surprisingly to us, Dow Jones has stayed inside the High Volatility region that we have identified back in late November:
The 1D MA200 (orange trend-line) has supported twice already since November 10 and is now going for its 3rd hold. If we pay a closer attention to the 1D RSI we see that it has printed the very same pattern it made on all Lows during the 2022 Bear Cycle. That is basically 3 occasions. The RSI is very close to the 30.00 oversold barrier and as the 1D MA100 supports, it makes it the most optimal long-term buy level on a 2-month horizon.
Even though it has been mostly trading sideways within the High Volatility Zone, on RSI terms, it is comparable to all 2022 Lows that bottomed out on an oversold 30.00 1D RSI and started an aggressive rally in the form of a Rising Wedge.
Our Targets are: short-term = 33400 (Pivot Zone), medium-term = 34400 (February 14 Resistance), long-term 35500 (April 21 Resistance).
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easyMarkets Dow Jones Daily - Quick Technical OverviewAfter a recent decline, the DJIA index found support near the 32700 area, which is near the lowest point of December. If, eventually, that support area surrenders, this could clear the path towards the 31740 zone.
Alternatively, a break above a short-term tentative downside resistance line, drawn from the high of February 14th, could help attract the bulls back into the game. More of them may join on a move above the 200-day EMA.
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Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, are intended only to be informative, is not an advice nor a recommendation, nor research, or a record of our trading prices, or an offer of, or solicitation for a transaction in any financial instrument and thus should not be treated as such. The information provided does not involve any specific investment objectives, financial situation and needs of any specific person who may receive it. Please be aware, that past performance is not a reliable indicator of future performance and/or results. Past Performance or Forward-looking scenarios based upon the reasonable beliefs of the third-party provider are not a guarantee of future performance. Actual results may differ materially from those anticipated in forward-looking or past performance statements. easyMarkets makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or any information supplied by any third-party.
Apple: Bearish Daily Close Apple may have just given us the first daily topping signal. It closed below key support which leaves it extremely vulnerable to more downside. This leading stock will take the markets much lower if it breaks down.
Daily secondary lower close is on watch to solidify this trend change in apple.
Poised for Action, 1 Mar 2023🖼 Daily Technical Picture 📈
➤ February is done and dusted. Tuesday trade ended down after a late sell-off. The second consecutive down day. Although prices have moved laterally for past few days, the behaviour shows Bears taking control. Previously, we saw buying support to close out the day, this has now reversed.
➤ I think price is poised to stride lower very soon. I'd like to see VIX rebound higher in concert with a price drop to bring a higher level of confidence that the drop will stick. In fact, VIX has been stuck in the low 20s for a while. I need to see this spike much higher.
➤ Conclusion: February was favourable although there was little trading action. On to March we march.
us30 decline from 71% to -37% of yesterdays price displacementus30 is going to drop more than 330 points to erase yesterdays rally. Give me a follow if it pans out correctly.
A Short Pause, 28 Feb 2023🖼 Daily Technical Picture 📈
➤ As per recent weeks equity prices opened with optimism and finished with a whimper. Today was no exception. Price filled the large gap left open on Friday trade but made no further headway.
➤ S&P500 equity index is still dancing around the 400 level and the 200-day moving average. I expect this to continue but only for a few days. Price should break away from this area very soon.
➤ Price could move upwards to fill in the two smaller price gaps just above but I think more likely it may drop. A good sized drop will give me an opportunity to re-enter with shorts. A move higher may mean staying patient for a trade.
➤ There's plenty of action in other asset classes. See above links for USD and NATGAS price action.
➤ Conclusion: Last day of Feb, time flies by so fast when you're having fun.
TGIF, 24 Feb 2023🖼 Daily Technical Picture 📈
➤ A negative day to finish off a negative (shortened) week for equity prices. S&P500 was down around -2.7% from previous Friday close.
➤ Yet again we saw Friday trade finish higher than it started (green arrows in chart). This makes it 9 consecutive Fridays. Probably the only consistent observation that I can make since the start of the year. Yet I do see a wrinkle, overall, the size of the "body" of the candle i.e. distance between daily open and close has narrowed. Either someone has exploited this anamoly or it is simply the fact that we should expect a narrowing during a short-term downtrend since 2 Feb. In that case, when the bullish trend returns, we should once more see a large profitable body on Fridays?
➤ We should also note the gap in daily prices between previous days' close and the next days' open (blue arrows in chart). These tend to get filled in due course, meaning prices should at some stage (whenever that will be) will return back up to these levels.
➤ Anyway, I shouldn't bore you with such uninteresting and useless observations. Over this weekend, I'll re-visit some of the charts to look at any price developments in other asset classes such as NATGAS, GOLD, USDOLLAR etc.
➤ Conclusion: TGIF, have a great weekend!
DOW JONES Aggressive bullish reversal expectedDow Jones (DJI) broke below its Pivot Zone and Higher Lows trend-line and as per our strategy published 2 weeks ago, we took that break-out sell opportunity:
With the 4H RSI though printing Higher Lows against the price's Lower Lows (i.e. a Bullish Divergence) and the price approaching the 32480 Support level and the 1D MA200 (red trend-line), which both provided Support and started aggressive rebounds on November 09 2022 and December 20 2022, Dow is turning into a medium-term (at least) buy opportunity again.
In fact the very same RSI Bullish Divergence formed the December 20 Low. It is important to add that this Low was formed after a 4H Death Cross, a pattern that we already formed again 2 days ago.
We are buyers again on Dow, targeting the 4H MA50 (blue trend-line). Then we will either wait for a pull-back or buy when the price breaks above the Pivot Zone and re-tests it as Support, in similar fashion as on January 06 2023 and January 23 2023. Long-term target 34300.
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us30 short form 50% to -21% of yesterdays price displacement Us30 is going to drop about -340 to -300 points today. approximately from 50% to -21% of yesterdays price displacement. Please give me a follow when this pans out correctly.
The 400, 24 Feb 2023🖼 Daily Technical Picture 📈
➤ Equities were all over the place on Thursday trade. Starting higher, dipping lower before moving back up to where it all pretty much started.
That is "The 400".
➤ 400 is the key round number level of the S&P500 Index (SPY) or 4,000 for the SPX500. Price tends to get drawn to and then gyrate around these round numbers like a moth to a flame. Not to be outdone, there is also the 200-day moving average in the midst.
➤ What's significant about the round numbers like 100, 1,000 or 30,000? Nothing in particular. It's just that "human" psychology finds them "favourable" or "comforting" or "satisifying" perhaps? It's certainly more appetising than a number like 30,627. Obviously, algos and bots also try to exploit these conditions, hence the back and forth we usually see.
➤ I took the exit signal to get out of my short position. Does it mean prices may bounce higher? It's certainly possible but I don't have a high conviction view. I'm going to sit it out for now until the next favourable opportunity hopefully very soon.
➤ Conclusion: Happy to be counting my profits until the next trade.
DJIA Is Hunting Support at 31000-32000 AreaDJIA going down for C wave. So the correction is not done yet it seems. I think that commodity currencies can make deeper pullbacks then; AUD, NZD will be my favorite ones for longs (longer-term) when this correction on DJIA unfolds.
Trend Continuation, 23 Feb 2023🖼 Daily Technical Picture 📈
➤ Equities finished slightly down although tech and small cap outperformed. Price recovered from the day's low towards the end of the trading session but was not able to hold on to earlier gains.
➤ Overall, there's little to say about today's price action. S&P500 once again finished below the 400 level. Usually around these "round" numbers, price likes to move to and fro.
➤ I continue to hold my large short position.
➤ Conclusion: I still favour trend continuation to the downside in the short-term.
Hang On Tight! 22 Feb 2023🖼 Daily Technical Picture 📈
➤ It was a strong red day across the board with small-cap and tech suffering the most. Interestingly the DOW 30 lost more than the S&P500. That is unusual. Our hanging wo(man) failed to hold on to support on two accounts. Firstly the short-term low at 405 and also the 200-day Moving Average.
➤ Today's losses wiped out all of the February gains as well as 50% of the gains for the year (as measured from the recent peak).
➤ So where will our hanging wo(man) land? Around 390 is a clear first target. If that doesn't hold, next level is 380.
➤ I continue to hold my large short position.
➤ Conclusion: Hang on tight!
Don't Leave Me Hanging! 20 Feb 2023🖼 Daily Technical Picture 📈
➤ Equity prices finished Friday trade in an unconvincing manner. It looks like a wo(man) struggling to hang on from height (as illustrated). Obviously I'm a bit biased given my short positioning. Price did hold above the recent low at 405 so there is an opportunity for price to continue to recover.
➤ BTW, have you noticed that on every Friday since the start of the year, the market has closed higher than the open? What does it mean? Probably nothing...just thought it was good trivia.
➤ Anyhow, the price is really hugging my predicated price path nicely. To stay that way, we need to see the price drop immediately on resumption of trade Tuesday. There's nothing magical about the path, it is completely coincidental that the price is following it.
➤ Conclusion: Look out below.
us30 shortus30 short 12RR. My analysis suggests that a big decline is approaching. Its probably going to end next weak before mondays us open. tell me what you think
It's Showtime! 17 Feb 2023🖼 Daily Technical Picture 📈
➤ We continue to see significant intra-day volatility in equities. Swings in excess of 1% up and down are now the norm. We should continue to expect this especially during this crucial period.
➤ This is the first day after many that the prices have managed to finish lower. The Bulls were not able to support the price. Their attempts today failed. That was sufficient to give me the signal to go ALL IN. Meaning, I am now SHORT with the maximum position size. It's Showtime!
➤ For things to go my way, I firstly need to see the price confidently break below 405. This was the recent low in the side-ways movement in the past couple of weeks. Then there is the much watched 200-day moving average at around 400. Below that is a possible fast drop to 390. That's around a 5% move from current levels.
➤ Conclusion: The Short trade plan is beginning to move in my favour but plenty of things may go wrong.
