Market Analysis Summary
Bernanke – Early Change of Interest Rates or Asset Purchase is Wrong Move
- Gold, Euro and AUD Continue their trends lower as expected after corrective rally
Commodities – Precious metals, the corrective rally is completed and new lows towards 1300 are expected. Base metals are positive and in line with our count higher
Forex – The corrective rallies in the Euro and AUD are completed and new lows are expected. Short on XXX/USD and even XXX/JPY pairs while S&P and USDJPY are moving lower
Indices – We have been looking for a top in the global indices and the move down in the last session is displaying as an Elliott impulse wave, there for once completed and after a three wave intraday bounce we can expect another five waves down.
Stocks – Risk Off - Look to Short
Precious Metals
US Spot Gold CFD 1368
TradingLevels The 1400 has its second retest, a little higher than expected, as the spike in markets was more headline driven. However the trend lower is back on track. Once the SG2 1380|1372|1365 is the tested resistance then the midpoint 1350 will follow. But expect a bounce at the midpoint. The trend target is lower at 1300 (mTL3), also expect buyers at SG1 1330|1320|1210
Elliott Wave: Wave (iv) completed, leaving the next target lower towards 1300.
Strategy: Hold Short stocks like NCM
US Spot Silver CFD 2235
Technical Analysis: The corrective rally like gold has completed, unless we are going to see a very complicated wave four, so initially we need to be mindful that this whole move up can be just the first leg of a larger sideways pattern in three or five swings. That said, short Silver with a stop above the last high and look to add once the 2200 is the tested resistance
Oil WTI CFD 94.50
Technical Analysis: - 95 as tested resistance is the short trade set up.
The daily trendline resistance holds Wave D of the triangle (daily chart) and Wave (b) 4 Hour Chart) in place. Leaving a move open lower towards the Mediumlevel ML9|90.00 as Wave (c) of E to complete the daily chart triangle, this would be followed by a move upwards in line with stock. On the flipside if the 9600 becomes the support then expect a move to 100
Base Metals
US Spot Prices (in l/b)
US Copper: Last: 3.34+
US Nickel: Last: 6.85+
US Zinc: Last: 0.8348+
US Aluminium Last: 0.8292+
US Copper CFD 335
Interesting to see precious metals and oil lower and base metals higher, obviously a different catalyst driving these markets, perhaps we are correct with the view on the Chinese markets.
The market has now arrived at 340 where it will meet supply and correct, looking for support. The main point here is that the market must stay above 330 to remain bullish. AU BHP made a new high in the last session, which confirms the impulse wave up, so after an impulse wave is and abc corrective pattern and then another five waves higher. It would also be helpful to see the AU materials sector XMJ create an impulse wave up from its lows, a move above 9800 would do that and it would then have resistance at 10,000 TL1. But this impulse wave would set a target higher to 10,500 – 10,800 as a conservative target
Forex Trading
US Dollar CFD 84.30
TradingLevels: The 83.50 support held well, completing the corrective pattern. The next move should be to 85.00 for another corrective pattern. The 8450 is playing out as resistance and will react looking for support before moving higher and developing the 8450 as support for the move to 85.00 (mTL5) where we can expect a larger corrective structure
Elliott Wave: Wave (iv) retracement completed and Wave (v) to just above 85.00 is underway.
EURUSD 1.2850
TradingLevels: The retest to 130 the minorlevel (mTL3) is completed. Expect a bounce at 128 and SG1 of 128. The bounce should find resistance at 12872 SG2 zone before moving lower through 128
Elliott Wave: Wave (iv) completed at 130 and Wave (v) to make new lows below Wave (iii) at 128
CFD Trading Strategies: Find a retest price point to short from such as a retest back to 129.
AUDUSD 0.9677
TradingLevels: Minorlevel mTL8|0.98 has been retested as the resistance which open the target to the next Minorlevel mTL5|0.95 of course this is some way off and certain wave structures require navigation.
Elliott Wave: Wave (iv) is completed and didn’t reach its target because of Bernanke speech. The Wave (v) of iii) is well under way. The small corrective pattern at 97 is a wave iv.
Trading Strategies: Use the failed retest at 0.97 the trigger can be the 9672 as resistance and too short to 9650. Long term trend traders continue to hold short with the 95 in mind.
Indices
DJI CFD 15,336
TradingLevels: The important fundamental point here is that the market continued to move down after Bernanke’s speech. We have been searching for a top as you know and this looks like it. The 15,200 would be require as resistance, this would set the next target at 15,000 the Mediumlevel
Elliott Wave: The move down is developing into an impulse wave (five waves) which would be followed by a abc corrective rally off the 15,300 back to 15,400 and then another five waves down, roughly speaking.
Trading Strategies: Short the abc rally
S&P500 CFD 1657
TradingLevels: Expect a bounce off the Mediumlevel 1650 with the Sg2 165|1672 as the resistance. Then expect further downside through 1650 to 1630
Elliott Wave: There are five waves down developing if this is the case then expect an abc 5-3-5 bounce rally off the 1650 and then another five waves lower towards 1630
Trading Strategies: Look to short the bounce off 1650 the abc 5-3-5 structure at 1665 or 1672
FTSE 100 CFD 6775
TradingLevels: The number 8 is profit taking that is 6800 (MinorLevel mTL8 Profit taking number)
Elliott Wave: Short retested of 6800 to 6700. There are five waves developing sown from the high, once completed and abc counter trend and then another five waves down
DAX CFD 8452
TradingLevels: The top of Wave (v) just above 8500, if the count is correct then a move back to 83.00 - 82.00 Wave 9iv) zone. The 83.00 is the 38.2% retracement level.
Shanghai Comp 2302
Same - Expect a corrective pattern across 2300 then support 2272 then further upside
ASX 200 CFD 5180
TradingLevels: On the cash market the 38.2% retracement level is 5120, so below 5100 as resistance, then we have a serious top in play back to 5000 and below.
Elliott Wave: The Wave (iv) target was 5130 but I can see the structure will take it lower to 5100. The other point is that the move down in the US markets is five waves, so we can expect another five waves down..
Day Trading Strategy: Continue to short. Thursday bear day.
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NOTES:
1. Check the ASX Dividend & Reporting check the company financial calendar before trading
2. Prices may change as this report is written while US markets are trading
3. Always think things out for yourself, we are only here to bounce ideas around.
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