FTSE 100 (cash future)
(based on 30 year advanced data charts)
Yearly
Price chart: While Dow over the pond has maintained its long term upstream moo river, FTSE100 is in a bigger trouble, as it is confronted with a question of a cross road or cross stream which asks whether FTSE100 is actually now in a downstream moo river. the falls end of last year and this year has penetrated the long term upstream moo river, but fortunately the bear market rallies have withdrawn the candle bodies inside the moo river. We will know the answer to this key question to the future of Britain, as it all depends on whether we can finish above 4000 by the end of this year. Right now, we are facing substantial bear defence from 4450 to 4680, millions of bears lay in camp here to launch their onslaughter. It is very difficult to see that bulls can actually carve this bear defence zone. In the longer time frame, we are in a giant bear market rally, lasting possible just short of 2012, to reach somewhere very close to 6000 again, then we will ask whether the world or the western world or Britain has found a new impetus for growth, or are we (particularly the Western world) in a terminal decline. But we have plenty of scope to manoevour yet, no need to be forced into answering this challenging question until 2020, possibly.
All momentum indicators are bearishly poised at the moment.
Quarterly
Price chart: let's stop worrying ourselves sick with the longer term challenges and for now, let's all enjoy this bull run as if this is a new bull market. Things can be all seen in different perspectives if you switch the time frames. In the medium term horizon, we are in a new bull market lasting for years. While it might be a slow burner to start with, it will soon gather pace once we get to the giant and powerful Wave 3. For now, we can almost see a balanced debates between bulls and bears, each having plenty of evidence to support their cases. This is a classical Wave 1 of the new bull market, only the visionary and the brave bulls will be buying into this and the crowd will only join in Wave 3. In order to facilitate this paradigm shift, we must reach 4680ish as a minimum target and close the quarter above 4450. We have got one month to do it, starting tonight in Asia.
RSI: this is where it is evident that Britannia is in fact in a long term decline as the yankies. Once we have finished with this pullback, bears will be the only ones laughing, but for now, can they survive this temporary setback in their bear campaign as we are going to test their patience and capital to the extreme? I now see why George Soros is bear hugging Britannia for his final trophy to be put on his tombstone--Soros, the bear that breaks down Britannia! (I can also see the more glorious one for Buffet--the bull that saves America from the deepest financial crisis in history, if he bows out at the right time, though personally I wish him to keep at active investing and living happily for ever!).
All other momentum indicators are reluctantly supporting the bulls' case for a pause in the giant bear market over decades, but we are yet to kick off this new bull market in style.
Monthly
Price chart: while I am a permabull in this bull run, I see prices to remain at least under 4800 for June, if not under 4740, or even 4680, which is the most likely candidate for me. Above 4680, I may join the bears for a quick scalp of a few hundrew bear points, as the reward is handsome enough, while the risk is minimum (I will explain that later).
RSI: this is where it will tell us where to cash in longs and turn into bears as there are various upperbanks or key resistance levels there. I will keep an eye on these and keep you alerted.
There are a few oddly shaped W on other momentum indicators, on the whole, many are unconvinced about this new bull market (in the medium term) yet or maybe many are staring with fear at the giant bear market over the longer term. But it is a tricky market and we have to make day to day, if not tick to tick decisions for some daytraders. Long term outlooks help to shape your long term stance, but 'we have to trade what we see, not what we want to see' (Sir Grim) or what we will see in years to come.
Fear and greed, it is very much a balancing act for this highly challenging game of daytrading.
Weekly
Price chart: while we are in the upstream moo river, there is really no hurry to go up just yet, it could take us potentially all the way to the end of June to fill in the gaps to the lowerbank and then we must either break higher or lower, otherwise, we are happily stuck in this 4300 and 4500 range. Please check out the 'Weekly forecasts and results' for my speculation for this coming week.
Most momentum indicators are supportive so far and will not tell you whether they are exhausted or not. Trick or treat for bulls and bears. Wise traders will work out two sets of trading plans, one for this range and another for break outs from this range. Let's all get ready for some Moocanic action this week.
Good luck.
Sunday 31 May 2009
Thursday 28 May 2009
Hangseng 42-- New Weekly Moocano Watch on 28th May 2009
Hangseng 42
Yearly
Price chart: this one has gone over a key pivotal point at 17691. Hong Kong is definitely the leader of all global stock markets at the moment, it has the benefit of both worlds, western and Chinese and it is supported by both sides as well for economic reasons on one side and political reason on the other. It just seems that the bulls there are on Superbull drinks, even the billionaire Mr Li's warning did not make the bulls jitter at all. The next resistance point is near 24658, surely, that is a very tall order only for the Honker bulls.
Quarterly
Price Chart: hindsight is a beautiful thing to have and we can now draw a perfect downstream moo river there, encompassing all the actions up to the first quarter 2009 and with this quarter's candle standing right on top of the upperbank, how proud and beautiful for the bulls. We have gone beyond all bulls' imagination and up to all bears' resistance, this feels almost on the verge of moocanic eruption as well. Beyond 18000, sky is the limit. I think I used this phrase a few times on the old HQ at the beginning of this bull rally and now look where the sky is! If you are a bear, don't short Hong Kong as well as Japan, while the evidence for Japan is still not there, but Hong Kong could really go parabolic, as I recall 2009 is the full year where a lot of Chinese wealth money can be poured into the Hong Kong stock market freely. This could be a bubble of a magnitude that few bears can average up and survive, be warned and be very careful there if you are a bear there. Draw the five waves down in the downstream moo river and think the following:
a. Wave 4 is just Wave 1 in a 5 wave impulsive waves up;
b. Wave 5 is Wave 2 and we have gone past that;
c. We are in Wave 3 and look back at the Wave 3 down last year, it was a massive 16185 pointer! if this current Wave 3 is of similar magnitude, it will burn a lot of averaging up bears to their last hair! Think again, if you actually afford to do that!
Monthly
Price Chart: we are definitely in a powerful upstream moo river at a very healthy rising angle of +45 degrees. For some reason, we are keeping it really steady and quiet along the lowerbank at the moment. While the outlook given in Quarterly is for a V shaped rally back up to where we came down from last year, we could also work out a less bullish scenario for a top near 20700ish (I am astounded, as this is a number supplied by one of my best mates on the III forum in the name of Toastmaster General--TG as I call him, a few months back, well before this rally took any sort of shape or form). So sky might have a limit after all. If that is the case, June is the month for it, it seems.
RSI: take a look of that, you could see five waves down followed by a W shaped rally up. It is a beauty if you are a bull.
Other momentum indicators are all bullish and exhibit no signs of tiring or bearishness yet, shocking!
Weekly
Price Chart: while 18221 might be a pivotal resistance level, really there is nothing to stop this one to go straight to 20700 and why would it stop there, I will double check with TG again. For me to come to this figure amongst the moo rivers and my simpllistic EWT waves is simply shocking.
RSI: this is the first place that I see justification for a major pullback, once we have hit the upperbank in this healthy looking upstream moo river. Watch out for an oddly shaped M against the upperbank, for bulls to take profit at the right top of this wave of rally.
Momentum: we have penetrated one giant triangle there, and have a study of the triangle theory, I think it needs to seek an equilibrium somewhere in terms of another triangle. For my reckoning, we have hit the upperbank there now, but remember price tends to lag momentum, so price might still rise on bearish momentum divergence, until gravity exerts itself.
Bollinger: it tells a similar story of an imminent top in terms of price on bearish divergence, with a M there and a bearish crossing as well.
Other momentum indicators are all telling a similar story of an imminent intermediate pullback, almost a half-time break.
=====================================
Unless you have a huge pot, as a private daytrader, in the year 2009, I would definitely recommend to avoid gold, Japan, Hong Kong and perhaps currencies as well. It would be easier to trade something closer to reality where there is a pull of forces between both parties, not in parabolic run either big up or big down. You think it would be a perfect market if you get it right; but think again, always think about what if you get it wrong, it could easily wipe you out for good.
good luck.
Yearly
Price chart: this one has gone over a key pivotal point at 17691. Hong Kong is definitely the leader of all global stock markets at the moment, it has the benefit of both worlds, western and Chinese and it is supported by both sides as well for economic reasons on one side and political reason on the other. It just seems that the bulls there are on Superbull drinks, even the billionaire Mr Li's warning did not make the bulls jitter at all. The next resistance point is near 24658, surely, that is a very tall order only for the Honker bulls.
Quarterly
Price Chart: hindsight is a beautiful thing to have and we can now draw a perfect downstream moo river there, encompassing all the actions up to the first quarter 2009 and with this quarter's candle standing right on top of the upperbank, how proud and beautiful for the bulls. We have gone beyond all bulls' imagination and up to all bears' resistance, this feels almost on the verge of moocanic eruption as well. Beyond 18000, sky is the limit. I think I used this phrase a few times on the old HQ at the beginning of this bull rally and now look where the sky is! If you are a bear, don't short Hong Kong as well as Japan, while the evidence for Japan is still not there, but Hong Kong could really go parabolic, as I recall 2009 is the full year where a lot of Chinese wealth money can be poured into the Hong Kong stock market freely. This could be a bubble of a magnitude that few bears can average up and survive, be warned and be very careful there if you are a bear there. Draw the five waves down in the downstream moo river and think the following:
a. Wave 4 is just Wave 1 in a 5 wave impulsive waves up;
b. Wave 5 is Wave 2 and we have gone past that;
c. We are in Wave 3 and look back at the Wave 3 down last year, it was a massive 16185 pointer! if this current Wave 3 is of similar magnitude, it will burn a lot of averaging up bears to their last hair! Think again, if you actually afford to do that!
Monthly
Price Chart: we are definitely in a powerful upstream moo river at a very healthy rising angle of +45 degrees. For some reason, we are keeping it really steady and quiet along the lowerbank at the moment. While the outlook given in Quarterly is for a V shaped rally back up to where we came down from last year, we could also work out a less bullish scenario for a top near 20700ish (I am astounded, as this is a number supplied by one of my best mates on the III forum in the name of Toastmaster General--TG as I call him, a few months back, well before this rally took any sort of shape or form). So sky might have a limit after all. If that is the case, June is the month for it, it seems.
RSI: take a look of that, you could see five waves down followed by a W shaped rally up. It is a beauty if you are a bull.
Other momentum indicators are all bullish and exhibit no signs of tiring or bearishness yet, shocking!
Weekly
Price Chart: while 18221 might be a pivotal resistance level, really there is nothing to stop this one to go straight to 20700 and why would it stop there, I will double check with TG again. For me to come to this figure amongst the moo rivers and my simpllistic EWT waves is simply shocking.
RSI: this is the first place that I see justification for a major pullback, once we have hit the upperbank in this healthy looking upstream moo river. Watch out for an oddly shaped M against the upperbank, for bulls to take profit at the right top of this wave of rally.
Momentum: we have penetrated one giant triangle there, and have a study of the triangle theory, I think it needs to seek an equilibrium somewhere in terms of another triangle. For my reckoning, we have hit the upperbank there now, but remember price tends to lag momentum, so price might still rise on bearish momentum divergence, until gravity exerts itself.
Bollinger: it tells a similar story of an imminent top in terms of price on bearish divergence, with a M there and a bearish crossing as well.
Other momentum indicators are all telling a similar story of an imminent intermediate pullback, almost a half-time break.
=====================================
Unless you have a huge pot, as a private daytrader, in the year 2009, I would definitely recommend to avoid gold, Japan, Hong Kong and perhaps currencies as well. It would be easier to trade something closer to reality where there is a pull of forces between both parties, not in parabolic run either big up or big down. You think it would be a perfect market if you get it right; but think again, always think about what if you get it wrong, it could easily wipe you out for good.
good luck.
Wednesday 27 May 2009
Japan (Nikkei 225)-- moo river drawing practice
I have decided to use Nikkei to show you how I draw the moo rivers, butterflies, WM's etc. I need your cooperation to practice drawing from today onwards and I will continuous provide you with sketching details to complete our drawings on Nikkei 225 in the coming weeks and months. Hopefully, this way, you will be able to do your own moo river watch on Japan and extend that to whatever you are trading as well.
Japan (Nikkei 225)
(based on 30 year advanced data charts)
Yearly
Price Chart: when you look at Nikkei's yearly chart, do you shilver at the giant red candle in 1990, what if you were trading it and you happened to be in the averaging down mode?! When a market turns from the upperbank, its target is its lowerbank, though at the time very few would know where the lowerbank was, hindsight is a great thing. And conversely, look at the years before 1990, what a run there, what if you were a sceptic bear and had averaged up the other way round? If you think daytrading is easy money, think again. The greatest bear of all time Livermore got wiped out a few times! Now let's get down to moo river watch.
If you are a fan of Elliott Waves, you can certainly count 5 impulsive waves down from 1990 to last year. Even the global internet boom and the millenium magic only gave Nikkei enough momentum to meander across half way in the ginormous downstream moo river. However, from 2003 onwards, the bears seemed to find it hard going and the last three waves could possibly be part of a giant W to bounce out the decades long bear market finally for Japan, despite the fear or threat of a nuclear bombing from North Korea, a second time in Japan's history. We have to remember the economic miracle in Japan was actually triggered by the post nuclear bombing western sympathy and support and the hard working by the Japanese people.
Let's draw these five waves down together.
Wave 1: link up candle body top for 1990 to the candle body bottom of 1992;
Wave 2: link up candle body bottom of 1992 to the candle top of 2000;
Wave 3: link up candle top of 2000 to the candle bottom of 2003;
Wave 4: link up candle bottom of 2003 to candle top of 2007;
Wave 5: link up candle top of 2007 to candle bottom of 2009.
Now you need to draw that downstream moo river, linking up tops and bottoms to encompass all the actions since 1990, where you will see we breached the lowerbank in 1992 and breached slightly the upperbank in 2007.
From here, I want you to draw the right arm of the giant W to be resisted under by the extension of Wave 2 as the ceiling.
Having drawn all these, I want you to complete the drawing of a giant reversal butterfly, with veins in the right wing, which will provide resistance lines in the new bull market in Japan, if that is what is going to happen in the coming years.
Have a go and have fun.
Japan (Nikkei 225)
(based on 30 year advanced data charts)
Yearly
Price Chart: when you look at Nikkei's yearly chart, do you shilver at the giant red candle in 1990, what if you were trading it and you happened to be in the averaging down mode?! When a market turns from the upperbank, its target is its lowerbank, though at the time very few would know where the lowerbank was, hindsight is a great thing. And conversely, look at the years before 1990, what a run there, what if you were a sceptic bear and had averaged up the other way round? If you think daytrading is easy money, think again. The greatest bear of all time Livermore got wiped out a few times! Now let's get down to moo river watch.
If you are a fan of Elliott Waves, you can certainly count 5 impulsive waves down from 1990 to last year. Even the global internet boom and the millenium magic only gave Nikkei enough momentum to meander across half way in the ginormous downstream moo river. However, from 2003 onwards, the bears seemed to find it hard going and the last three waves could possibly be part of a giant W to bounce out the decades long bear market finally for Japan, despite the fear or threat of a nuclear bombing from North Korea, a second time in Japan's history. We have to remember the economic miracle in Japan was actually triggered by the post nuclear bombing western sympathy and support and the hard working by the Japanese people.
Let's draw these five waves down together.
Wave 1: link up candle body top for 1990 to the candle body bottom of 1992;
Wave 2: link up candle body bottom of 1992 to the candle top of 2000;
Wave 3: link up candle top of 2000 to the candle bottom of 2003;
Wave 4: link up candle bottom of 2003 to candle top of 2007;
Wave 5: link up candle top of 2007 to candle bottom of 2009.
Now you need to draw that downstream moo river, linking up tops and bottoms to encompass all the actions since 1990, where you will see we breached the lowerbank in 1992 and breached slightly the upperbank in 2007.
From here, I want you to draw the right arm of the giant W to be resisted under by the extension of Wave 2 as the ceiling.
Having drawn all these, I want you to complete the drawing of a giant reversal butterfly, with veins in the right wing, which will provide resistance lines in the new bull market in Japan, if that is what is going to happen in the coming years.
Have a go and have fun.
FTSE100-- New Weekly Moo River Watch on 27th May 2009
FTSE100 (cash future)
(Based on 30 Year advanced data charts)
I have lost all my moo rivers yesterday through a systems change at my market maker and I forgot to back them up on prints or saved copies, so I have to redraw all the moo rivers, which is going to take a lot of time to recover. Yet, the beauty of the Moo River Trading System is very much in the drawing. You have to draw out the alternatively and keep an open mind about your drawing and you have to draw as diligently as possible, as you will never step into the same moo river twice.
Quarterly
Price Chart: tentatively, I have drawn out the path forward till Q2 2010, on the basis that 4300 key support holds firm. If that hypothesis works, then this quarter's top is near 4680ish, rather than 4800 or 5000. And if this hypothesis works out, then we will see this year's high in Q4, which is exactly the opposite copy of last year's movements. While bulls are in vogue at the moment by trading buying on dips and dives on gritted teeth and handsome rewards, bears must be patient to lay out ambush near the upperbank of this upstream moo river. Watch out, when I mention we have hit the upperbank, that is a hint for a good bear claw out once in a while. Meanwhile, one might work out a strategy based on this particular scenario. If 4300 is broken firmly, then we have to redraw the moo river here.
RSI (I am liking this real-time chart a lot, as there are so many more facilities to play with, like the alarm, which is such a brilliant facility): for now, we have to say we are in a ginormouse downstream moo river from Q4 1987. While we are bouncing up, we can easily cave back down big time any time, as we are hanging in the middle of the bottom half of this downstream moo river. I have divided this downstream moo river into two halves, and set an alarm there when we touch the midline, which seems to be in Q3 or Q4 if things go well. I will give you a shout when that happens.
Other momentum indicators are supportive, by bouncing up from oversold levels, nothing specific to mention.
Monthly
Price chart (I like this real-time chart a lot more, as you can move to the left and right so easily): while we still use the same upstream moo river scenario from the Quarterly, on the monthly, you have to modify it in such a way that it does not breach the quarterly moo river. So I have redraw some new banks to fit in with the quarterly moo river. This tells us that we will not reach the top of this quarter until next month. The maximum top target we might hit for May is near 4580ish. Well, we have got this week to hit it. While it is the maximum target, it might not happen, the primary target this month is to hold up above 4300, though hitting upperbank targets are bullish/confirmation behaviours as well.
RSI: we have had a beautifully shaped W to bounce up from last year's dive, but we are still very much stuck in the bear market or the ginormous downstream moo river. We have bounced in a W with such a shape that does not allow me to draw an upstream moo river, so it is just a bounce, not off the solid lowerbank as we did not get there last year and we are headed towards two possible upperbanks. I have an alarm there and will let you know we get closer to them. But with this kind of bounce, it can finish any time.
Elder Ray: we are in similar position as RSI, so I will keep you updated.
Momentum: similiar position, but it does allow you to draw an upstream moo river or crossing there, alarm set there.
Weekly
(I am so glad that I have lost all the moo rivers in one go last night, now this is a giant leap forward for Moo River Watch system, I can almost feel the excitement in me as a moo river watcher, because I feel like I have finally cracked the century old problem of whether Man makes history or history makes man!!!!!!!!!!)
Price Chart: I have to redraw again to fit in the monthly and quarterly moo rivers. I am still learning about this fitting process, which is an incredible experience. I will never publish any moo river charts here, in order to encourage all of you to draw your own moo rivers and also the moo rivers never stand still, so you can only rely on the Moo River Watch system, if you are able to draw and adapt to changing market situations. Remember, the key task for this week, the last week in May is to hold above 4300, anything else is a big bonus. If we can hit the monthly top target near 4580, it will be fantastic.
RSI: this is where the most significant development took place in the middle of April, where bulls have successfully broken the ongoing downnstream moo river and have now carved out an upstream moo river. (I am still learning about the alarm, as sometimes it allows me to set it and other times it does). While the rising angle is a very healthy +45 degrees, we might need to lessen that at a later stage to be more sustainable.
MACD: we are in a downstream moo river at the moment, not as bullish as RSI.
Elder Ray: it is warning of a weekly top with a M there at top levels.
Other indicators are still bullishly configured.
(Based on 30 Year advanced data charts)
I have lost all my moo rivers yesterday through a systems change at my market maker and I forgot to back them up on prints or saved copies, so I have to redraw all the moo rivers, which is going to take a lot of time to recover. Yet, the beauty of the Moo River Trading System is very much in the drawing. You have to draw out the alternatively and keep an open mind about your drawing and you have to draw as diligently as possible, as you will never step into the same moo river twice.
Quarterly
Price Chart: tentatively, I have drawn out the path forward till Q2 2010, on the basis that 4300 key support holds firm. If that hypothesis works, then this quarter's top is near 4680ish, rather than 4800 or 5000. And if this hypothesis works out, then we will see this year's high in Q4, which is exactly the opposite copy of last year's movements. While bulls are in vogue at the moment by trading buying on dips and dives on gritted teeth and handsome rewards, bears must be patient to lay out ambush near the upperbank of this upstream moo river. Watch out, when I mention we have hit the upperbank, that is a hint for a good bear claw out once in a while. Meanwhile, one might work out a strategy based on this particular scenario. If 4300 is broken firmly, then we have to redraw the moo river here.
RSI (I am liking this real-time chart a lot, as there are so many more facilities to play with, like the alarm, which is such a brilliant facility): for now, we have to say we are in a ginormouse downstream moo river from Q4 1987. While we are bouncing up, we can easily cave back down big time any time, as we are hanging in the middle of the bottom half of this downstream moo river. I have divided this downstream moo river into two halves, and set an alarm there when we touch the midline, which seems to be in Q3 or Q4 if things go well. I will give you a shout when that happens.
Other momentum indicators are supportive, by bouncing up from oversold levels, nothing specific to mention.
Monthly
Price chart (I like this real-time chart a lot more, as you can move to the left and right so easily): while we still use the same upstream moo river scenario from the Quarterly, on the monthly, you have to modify it in such a way that it does not breach the quarterly moo river. So I have redraw some new banks to fit in with the quarterly moo river. This tells us that we will not reach the top of this quarter until next month. The maximum top target we might hit for May is near 4580ish. Well, we have got this week to hit it. While it is the maximum target, it might not happen, the primary target this month is to hold up above 4300, though hitting upperbank targets are bullish/confirmation behaviours as well.
RSI: we have had a beautifully shaped W to bounce up from last year's dive, but we are still very much stuck in the bear market or the ginormous downstream moo river. We have bounced in a W with such a shape that does not allow me to draw an upstream moo river, so it is just a bounce, not off the solid lowerbank as we did not get there last year and we are headed towards two possible upperbanks. I have an alarm there and will let you know we get closer to them. But with this kind of bounce, it can finish any time.
Elder Ray: we are in similar position as RSI, so I will keep you updated.
Momentum: similiar position, but it does allow you to draw an upstream moo river or crossing there, alarm set there.
Weekly
(I am so glad that I have lost all the moo rivers in one go last night, now this is a giant leap forward for Moo River Watch system, I can almost feel the excitement in me as a moo river watcher, because I feel like I have finally cracked the century old problem of whether Man makes history or history makes man!!!!!!!!!!)
Price Chart: I have to redraw again to fit in the monthly and quarterly moo rivers. I am still learning about this fitting process, which is an incredible experience. I will never publish any moo river charts here, in order to encourage all of you to draw your own moo rivers and also the moo rivers never stand still, so you can only rely on the Moo River Watch system, if you are able to draw and adapt to changing market situations. Remember, the key task for this week, the last week in May is to hold above 4300, anything else is a big bonus. If we can hit the monthly top target near 4580, it will be fantastic.
RSI: this is where the most significant development took place in the middle of April, where bulls have successfully broken the ongoing downnstream moo river and have now carved out an upstream moo river. (I am still learning about the alarm, as sometimes it allows me to set it and other times it does). While the rising angle is a very healthy +45 degrees, we might need to lessen that at a later stage to be more sustainable.
MACD: we are in a downstream moo river at the moment, not as bullish as RSI.
Elder Ray: it is warning of a weekly top with a M there at top levels.
Other indicators are still bullishly configured.
Monday 25 May 2009
Week 21 (24th May-30th May): Royal Bank of Scotland-Weekly Moo River Watch
Royal Bank of Scotland
Yearly
Price Chart: the bears were having a laugh early this year, until the bear-wagon hit a rock and the bears fell off. The reason was everything was going well for them until they realised that it was nationalisaton or zero pence on this share they were headed for. 'What do we do now?', bears growled in dismay. If anyone had been shorting this share or any bank shares, they'd be billionaires by now. Strangely, despite all the bans on shorters etc, the Fortune's richest men list have not been filled with nouveau riches in the form of any bank share bears, how strange!
Reality is the only way for this share is upwards, however long it takes, though it might still be threatened with nationalisation at any moments of jittery economic news. If you had bought at 3 pence early this year, you'd made 10 times of your money, that is if you average down from 722 pence a share and still have enough money left and have not lost your nerves. The name Wallace the braveheart rings a bell here.
Quarterly
Price Chart: if you have been a long suffering shareholder, you must think twice about what they say about let the trend be your friend. This bear market has been so well managed since 2007 with every quarter producing a new lower low and lower high, that it is amazing that we did not see this final collapse coming sooner, including so many of our pension and fund managers. To date, we have not escaped this ginormous downstream moo river yet, though going to zero might not be an option here, so there is hope.
Monthly
Price chart: The downstream moo river is relentless, and we have just finished a meandering across from the lowerbank to the upperbank and ready for the next leg down, until we realised that the next leg down is to -115 pence, which is impossible, so now bears scratch their heads in disbelief, what do we do now? The only other alternative is to break this upperbank near 75 pence this month or 50 pence next month, which is the final month allowed by this downstream moo river, so there will be a decisive movement soon.
RSI: that one teaches you to think twice next time you want to say something is oversold. It almost dropped to zero on monthly RSI, shocking, isn't it?
Stoch: same story as RSI's, well stuck under the bottom of the deepest moo river.
But encouragingly, other momentum indicators have rebelled with W based rallies such as Elder ray and Momentum. Maybe, there is another life left in this 'dead' cat.
Weekly
Price chart: if you look at this chart, what does it remind you? Say it, yes, you can almost feel the pain of a constipator here. But the good thing we have almost managed the discharge out of the claws of all bears, meaning out of the downstream moo river, where bollinger band narrows in such a way that it is almost ready to burst into a new lease of life.
RSI: we have been kept by bears under 45/46 for the past few years, so a breach there will be very significant indeed, but we are showing some hesitation here already, old habits die hard, but there is no return, no return, as that way is to zero!
MACD: oddly shaped it might be, it is a ginormous W to the delight of those desperate long-term shareholders, we are bouncing up big time here in momentum.
Stoch: we have overshot ourselves here, though the W based rally has been a complete journey into 90's, which is a pleasant thought for bulls, though a M might take shape here to end the rally, which is long overdue.
Repulse: The W shaped rally must give the bulls hours, days and weeks of pleasure and encouragement. The power of WM is not to be ignored, as that is the strongest of all and the most sustainable of all.
We might create a bearish divergence shortly, if we do not fall off the cliff from here, meaning a price rise based on waning momentums.
Good luck.
Yearly
Price Chart: the bears were having a laugh early this year, until the bear-wagon hit a rock and the bears fell off. The reason was everything was going well for them until they realised that it was nationalisaton or zero pence on this share they were headed for. 'What do we do now?', bears growled in dismay. If anyone had been shorting this share or any bank shares, they'd be billionaires by now. Strangely, despite all the bans on shorters etc, the Fortune's richest men list have not been filled with nouveau riches in the form of any bank share bears, how strange!
Reality is the only way for this share is upwards, however long it takes, though it might still be threatened with nationalisation at any moments of jittery economic news. If you had bought at 3 pence early this year, you'd made 10 times of your money, that is if you average down from 722 pence a share and still have enough money left and have not lost your nerves. The name Wallace the braveheart rings a bell here.
Quarterly
Price Chart: if you have been a long suffering shareholder, you must think twice about what they say about let the trend be your friend. This bear market has been so well managed since 2007 with every quarter producing a new lower low and lower high, that it is amazing that we did not see this final collapse coming sooner, including so many of our pension and fund managers. To date, we have not escaped this ginormous downstream moo river yet, though going to zero might not be an option here, so there is hope.
Monthly
Price chart: The downstream moo river is relentless, and we have just finished a meandering across from the lowerbank to the upperbank and ready for the next leg down, until we realised that the next leg down is to -115 pence, which is impossible, so now bears scratch their heads in disbelief, what do we do now? The only other alternative is to break this upperbank near 75 pence this month or 50 pence next month, which is the final month allowed by this downstream moo river, so there will be a decisive movement soon.
RSI: that one teaches you to think twice next time you want to say something is oversold. It almost dropped to zero on monthly RSI, shocking, isn't it?
Stoch: same story as RSI's, well stuck under the bottom of the deepest moo river.
But encouragingly, other momentum indicators have rebelled with W based rallies such as Elder ray and Momentum. Maybe, there is another life left in this 'dead' cat.
Weekly
Price chart: if you look at this chart, what does it remind you? Say it, yes, you can almost feel the pain of a constipator here. But the good thing we have almost managed the discharge out of the claws of all bears, meaning out of the downstream moo river, where bollinger band narrows in such a way that it is almost ready to burst into a new lease of life.
RSI: we have been kept by bears under 45/46 for the past few years, so a breach there will be very significant indeed, but we are showing some hesitation here already, old habits die hard, but there is no return, no return, as that way is to zero!
MACD: oddly shaped it might be, it is a ginormous W to the delight of those desperate long-term shareholders, we are bouncing up big time here in momentum.
Stoch: we have overshot ourselves here, though the W based rally has been a complete journey into 90's, which is a pleasant thought for bulls, though a M might take shape here to end the rally, which is long overdue.
Repulse: The W shaped rally must give the bulls hours, days and weeks of pleasure and encouragement. The power of WM is not to be ignored, as that is the strongest of all and the most sustainable of all.
We might create a bearish divergence shortly, if we do not fall off the cliff from here, meaning a price rise based on waning momentums.
Good luck.
Week 21 (24th May-30th May): Lloyds Banking Group -Weekly Moo River Watch
Lloyds Banking Group
(based on 30 year advanced data charts)
Yearly
Price Chart: the downstream moo river here is a horrific one, even the 2003 bull market only managed to give LLodys Banking Group a pullback (a meandering across from lowerbank to upperbank) and a recent collapse due to the merger with HBOS is perhaps the final nail. Something must have gone wrong with this bank for the past decade. Today's recession only pushed the ugly stuff out from under the carpet. For now though, at least we will have a meandering across, if history is any guide, then it will give us a recovery value to 180 pence by 2013. If you are patient enough, you can almost triple your money from here.
Quarterly
Price Chart: you might like the idea of tripling your money in four year's time, in reality, if you watch this share, you are going to have jittery nights to sleep on. It is possible that we won't see £1 for most of the 2009 and there are occasional dives into those unmentionable horrible low levels again and again, as the fear of nationalisation is still very much there. The good news is, if you think this is a good news, this is the end of the bear market, either this bank gets nationalised or it takes off from 2013 onwards.
None of the momentum indicator is showing a decisive W shaped rally or a definitive bounce yet, though some are in deeply oversold levels, so surely the only way is up, or is it?
Monthly
Price chart: the maximum monthly range is between 88 pence and 31 pence, so we meander across to the upperbank.
Rsi: it is so oversold that it feels like being stuck in the deepest well, with lots of mud on top of it. We need to at least shoot through the water surface of 30 to have a breath of fresh air.
Other momentum indicators are not overly enthusiastic either, though most are well oversold, but few are having a rally based on a W. The oddly shaped W on Stoch is an encouraging sign, the one on Elder Ray is better shaped. There is hope, like they say, from these oversold levels, some visionaries or long-term investors might see some value here, though it will be a long journey to recovery, it does have scope for improvement, though scope might be the key word here, and there is also a possibility that when the economy pulls out of the recession, the giant bank might be broken back into two banks again. Maybe you can not see this possibility but you can nevery say never on this scenario, as a fully recovered combined banking group will almost be a monopoly in so many ways.
Weekly
Price Chart: we seem to be standing pretty upon Wilder's smooth MA20 line or the bollinger midline near 51 pence, though the maximum downside for the coming week is near 32 pence and the maximum upside is near 90 pence. We are enjoying some sort of recovery here, though it is a slow burner.
RSI: make no mistake that this share has also escaped that long running downstream moo river and it has actually managed to breach upperbank 1 earlier this month and now may even try to reach upperbank 2 just under 60, which will be a significant progress and I have reserved upperbank 3 just under 70 for the extreme of fantasists.
MACD: you must admire the bottoming up pattern here, with two W's connected with a V, which is something of a beauty. If you read my comments on the gold, you might find a reversed process in progress, with two M's there shaping up a ginormous M. It is all in the eyes of the traders to see the signals that the market is giving out in the charts, which is why I prefer technical analysis, for it is something everyone is capable of doing on their own.
Elder Ray: it has a nasty M there, so it is at least an anticipatory M, which means a top is quite near.
Repulse: if you like V shaped rallies, you will like the giant V here.
Overall, if you are a Lloyds Banking Group shareholder, you are either a very long-term investor, holding onto this share till 2013, or you are a short-term gambler, buying from 50's downwards and selling them from 70's upwards and you must be prepared for the constant threat or rumoured threat of nationlisation, when things turn nasty again. This share is only for the very hardened investors or speculators, where risk outweighs return, but the return can still be an attractive one, if you can sleep on jitteries as I mentioned above.
Good luck.
(based on 30 year advanced data charts)
Yearly
Price Chart: the downstream moo river here is a horrific one, even the 2003 bull market only managed to give LLodys Banking Group a pullback (a meandering across from lowerbank to upperbank) and a recent collapse due to the merger with HBOS is perhaps the final nail. Something must have gone wrong with this bank for the past decade. Today's recession only pushed the ugly stuff out from under the carpet. For now though, at least we will have a meandering across, if history is any guide, then it will give us a recovery value to 180 pence by 2013. If you are patient enough, you can almost triple your money from here.
Quarterly
Price Chart: you might like the idea of tripling your money in four year's time, in reality, if you watch this share, you are going to have jittery nights to sleep on. It is possible that we won't see £1 for most of the 2009 and there are occasional dives into those unmentionable horrible low levels again and again, as the fear of nationalisation is still very much there. The good news is, if you think this is a good news, this is the end of the bear market, either this bank gets nationalised or it takes off from 2013 onwards.
None of the momentum indicator is showing a decisive W shaped rally or a definitive bounce yet, though some are in deeply oversold levels, so surely the only way is up, or is it?
Monthly
Price chart: the maximum monthly range is between 88 pence and 31 pence, so we meander across to the upperbank.
Rsi: it is so oversold that it feels like being stuck in the deepest well, with lots of mud on top of it. We need to at least shoot through the water surface of 30 to have a breath of fresh air.
Other momentum indicators are not overly enthusiastic either, though most are well oversold, but few are having a rally based on a W. The oddly shaped W on Stoch is an encouraging sign, the one on Elder Ray is better shaped. There is hope, like they say, from these oversold levels, some visionaries or long-term investors might see some value here, though it will be a long journey to recovery, it does have scope for improvement, though scope might be the key word here, and there is also a possibility that when the economy pulls out of the recession, the giant bank might be broken back into two banks again. Maybe you can not see this possibility but you can nevery say never on this scenario, as a fully recovered combined banking group will almost be a monopoly in so many ways.
Weekly
Price Chart: we seem to be standing pretty upon Wilder's smooth MA20 line or the bollinger midline near 51 pence, though the maximum downside for the coming week is near 32 pence and the maximum upside is near 90 pence. We are enjoying some sort of recovery here, though it is a slow burner.
RSI: make no mistake that this share has also escaped that long running downstream moo river and it has actually managed to breach upperbank 1 earlier this month and now may even try to reach upperbank 2 just under 60, which will be a significant progress and I have reserved upperbank 3 just under 70 for the extreme of fantasists.
MACD: you must admire the bottoming up pattern here, with two W's connected with a V, which is something of a beauty. If you read my comments on the gold, you might find a reversed process in progress, with two M's there shaping up a ginormous M. It is all in the eyes of the traders to see the signals that the market is giving out in the charts, which is why I prefer technical analysis, for it is something everyone is capable of doing on their own.
Elder Ray: it has a nasty M there, so it is at least an anticipatory M, which means a top is quite near.
Repulse: if you like V shaped rallies, you will like the giant V here.
Overall, if you are a Lloyds Banking Group shareholder, you are either a very long-term investor, holding onto this share till 2013, or you are a short-term gambler, buying from 50's downwards and selling them from 70's upwards and you must be prepared for the constant threat or rumoured threat of nationlisation, when things turn nasty again. This share is only for the very hardened investors or speculators, where risk outweighs return, but the return can still be an attractive one, if you can sleep on jitteries as I mentioned above.
Good luck.
Sunday 24 May 2009
Week 21 (24th May-30th May): FTSE100--Weekly Moo River Watch
FTSE 100
(based on 30-year advanced data charts)
Yearly
Price chart: We seem to struggle to reach the bollinger midline, now a key resistance at 4569 while Wilder's smooth MA20 near 3963 might provide key support. You may notice the bull run in 2003 was supported by that particulary MA line.
RSI: this one puzzles me a lot. We are stuck in a downstream moo river and we are in the process of crossing from the upperbank to the lowerbank, but we seem to be hanging in the midstream with almost a level shape, which provides scope for both possibilities, either going up to challenge the upperbank again or dive down to complete the journey.
Stoch: it is bearishly crossed and pointing downwards, though it has almost reached a level where it could potentially shape up a W there;
Momentum: it has been extremely bearish, so bearish that one can almost see that it has overdone its bearishness by falling out of the downstream moo river there.
Elder Ray: it has completed its crossing from the upperbank to the lowerbank and now it seems to be lying upon the lowerbank to have a think whether to go up or go down further.
Overall, it simply says that we are still deeply in the bear market.
Quarterly
Price Chart: it is pleasing to the bulls that we have finally bounced off the lower bollinger band as support (if you use close/line chart). The only concern there is last time when the bear market ended in 2003, it started with a well-formed W. If we are going to have another W here, then a dive towards 4000 is not to be ruled out. The difference is that the bear market in 2002/2003 actually went into an overdrive deeply penetrating the lowerbollinger band, so it has to shape up W to conduct a three-pointer turning round for the market. This time, as the lowerbollinger band provided the key support, a V shaped rally is also a possibility. It all depends on how high the rally can go, a bit further, we can almost certainly rule out the W scenario, i.e., another dive down.
Wilder's smooth MA20 at 5092 might be an attractive target to end Wave 1 for the new bull market rally, if this is indeed the case.
Rsi: if you draw a downstream moo river there with four banks, two upperbanks and two lowerbanks, you can see that we have managed to get through the lowerbank 1 and are now on the way to upperbank 1. It looks to me more like that we will get there before a severe pullback to test out the resolve of the bulls. This seems to suggest that this rally will continue onto a significant price level, like 5092 perhaps, as the upperbank 1 is near 47.
MACD: this is a tricky customer, throwing up various scenarios.
1. it has completed Wave 1 and 2 or AB and is in the process of Wave 3 or C, both of which suggest a more bear market to continue for many a quarter;
2. it is in the process of shaping up a giant W, but there is still further weakness to come yet, before a final turn around to shape up the right arm of the W.
Overall, it seems to indicate further weakness ahead at least in momentum.
Momentum: If you like to study failed W's for kicking off bear runs, there is no better evidence elsewhere than on this indicator if you look at the peaks of both bull markets in 2007 and 1999. This one seems to be bouncing off a key lifeline and is now possibly stuck in a giant triangle, with various possibilities, though the lifeline itself suggests that momentum has hit the bear market bottom for now.
Elder Ray: the story from this momentum indicator seems to suggest that this is one final bear market rally, before a final plunge and then the next rally will be the real deal. And it also seems to be suggesting that we are 2/3 way through this final bear market rally, so still some more upside for the bulls yet. And it says that once we have done with this rally, the bottom of the bear market will be a new low, but not much more, but a lower low against the March low.
Repulse: the lesson here is the failed W in 1999 is such a lethal one, how did all the fund managers and every other bull then ignored that with such a fatal consequence. Technical analysis is really far superior than any other way of analysing the markets, as it is void of all human emotions and all newsflows. The story here seems to say that we are almost ready to shape up a giant W, whenever every other indicator and price is ready to go.
Monthly
Price chart: 4680 winks at the bulls and says 'come and overcome this and then you can go where you want!', as that would help to shape up a giant W. But we are hesitating and we are finding it harder not to cash in investments at a decend profit, having had a good run. This is the third green monthly candle in a row, and we have got another week to deal the bears a severe blow, as three green monthly candles in a row is what I said a minimum requirement to end the bear market.
Rsi: that W off the lowerbank has given this ride plenty of bouncibility and we are trying to get to the upperbank near 45, but we seem to be waning in determination and weighing down by gravity a bit.
Other indicators are still supportive.
Weekly
Price chart: we are still inside that final square of the diamond and there is no visible M there yet. We seem to be struggling against Wilder's MA20 near 4420. If you put your imagination to work here. You can try to work out the various scenarios as this diamond is going to be broken one way or another:
1. a rise towards 4650 for a fake bullish break out of the diamond and then cave back down big time;
2. a rise towards 4820 and continue to rally towards 5150 or 5430 (I see a million bears shake their big heads in disbelief!);
3. a drop towards 4170 to find the final support of the diamond wall and a rise towards 4820 to finish the whole bear market rally and then come back down big, on breach of 4400, quickly dives down towards 4000, thus to shape up another diamond in the process.
While imagination outside or inside the diamond does resemble a flight of fantasy, but as long as you work out the parameters of confirmation or falsification and make out your trading plans based on different scenarios, it will actually help you to plan trading better for the weeks ahead.
This final square has a maximum of three week's shelf life before the diamond is broken either up or down, so be warned, flooding in the moo rivers is to come within the coming three weeks, be ready for some fast and furious actions. We might need a candle specialist to read these three candles for the past three weeks for us.
All momentum indicators are in correlated upstream moo rivers as price, but some are showing signs of waning, mainly rsi, stoch and Elder ray.
Good luck to all bears and bulls.
(based on 30-year advanced data charts)
Yearly
Price chart: We seem to struggle to reach the bollinger midline, now a key resistance at 4569 while Wilder's smooth MA20 near 3963 might provide key support. You may notice the bull run in 2003 was supported by that particulary MA line.
RSI: this one puzzles me a lot. We are stuck in a downstream moo river and we are in the process of crossing from the upperbank to the lowerbank, but we seem to be hanging in the midstream with almost a level shape, which provides scope for both possibilities, either going up to challenge the upperbank again or dive down to complete the journey.
Stoch: it is bearishly crossed and pointing downwards, though it has almost reached a level where it could potentially shape up a W there;
Momentum: it has been extremely bearish, so bearish that one can almost see that it has overdone its bearishness by falling out of the downstream moo river there.
Elder Ray: it has completed its crossing from the upperbank to the lowerbank and now it seems to be lying upon the lowerbank to have a think whether to go up or go down further.
Overall, it simply says that we are still deeply in the bear market.
Quarterly
Price Chart: it is pleasing to the bulls that we have finally bounced off the lower bollinger band as support (if you use close/line chart). The only concern there is last time when the bear market ended in 2003, it started with a well-formed W. If we are going to have another W here, then a dive towards 4000 is not to be ruled out. The difference is that the bear market in 2002/2003 actually went into an overdrive deeply penetrating the lowerbollinger band, so it has to shape up W to conduct a three-pointer turning round for the market. This time, as the lowerbollinger band provided the key support, a V shaped rally is also a possibility. It all depends on how high the rally can go, a bit further, we can almost certainly rule out the W scenario, i.e., another dive down.
Wilder's smooth MA20 at 5092 might be an attractive target to end Wave 1 for the new bull market rally, if this is indeed the case.
Rsi: if you draw a downstream moo river there with four banks, two upperbanks and two lowerbanks, you can see that we have managed to get through the lowerbank 1 and are now on the way to upperbank 1. It looks to me more like that we will get there before a severe pullback to test out the resolve of the bulls. This seems to suggest that this rally will continue onto a significant price level, like 5092 perhaps, as the upperbank 1 is near 47.
MACD: this is a tricky customer, throwing up various scenarios.
1. it has completed Wave 1 and 2 or AB and is in the process of Wave 3 or C, both of which suggest a more bear market to continue for many a quarter;
2. it is in the process of shaping up a giant W, but there is still further weakness to come yet, before a final turn around to shape up the right arm of the W.
Overall, it seems to indicate further weakness ahead at least in momentum.
Momentum: If you like to study failed W's for kicking off bear runs, there is no better evidence elsewhere than on this indicator if you look at the peaks of both bull markets in 2007 and 1999. This one seems to be bouncing off a key lifeline and is now possibly stuck in a giant triangle, with various possibilities, though the lifeline itself suggests that momentum has hit the bear market bottom for now.
Elder Ray: the story from this momentum indicator seems to suggest that this is one final bear market rally, before a final plunge and then the next rally will be the real deal. And it also seems to be suggesting that we are 2/3 way through this final bear market rally, so still some more upside for the bulls yet. And it says that once we have done with this rally, the bottom of the bear market will be a new low, but not much more, but a lower low against the March low.
Repulse: the lesson here is the failed W in 1999 is such a lethal one, how did all the fund managers and every other bull then ignored that with such a fatal consequence. Technical analysis is really far superior than any other way of analysing the markets, as it is void of all human emotions and all newsflows. The story here seems to say that we are almost ready to shape up a giant W, whenever every other indicator and price is ready to go.
Monthly
Price chart: 4680 winks at the bulls and says 'come and overcome this and then you can go where you want!', as that would help to shape up a giant W. But we are hesitating and we are finding it harder not to cash in investments at a decend profit, having had a good run. This is the third green monthly candle in a row, and we have got another week to deal the bears a severe blow, as three green monthly candles in a row is what I said a minimum requirement to end the bear market.
Rsi: that W off the lowerbank has given this ride plenty of bouncibility and we are trying to get to the upperbank near 45, but we seem to be waning in determination and weighing down by gravity a bit.
Other indicators are still supportive.
Weekly
Price chart: we are still inside that final square of the diamond and there is no visible M there yet. We seem to be struggling against Wilder's MA20 near 4420. If you put your imagination to work here. You can try to work out the various scenarios as this diamond is going to be broken one way or another:
1. a rise towards 4650 for a fake bullish break out of the diamond and then cave back down big time;
2. a rise towards 4820 and continue to rally towards 5150 or 5430 (I see a million bears shake their big heads in disbelief!);
3. a drop towards 4170 to find the final support of the diamond wall and a rise towards 4820 to finish the whole bear market rally and then come back down big, on breach of 4400, quickly dives down towards 4000, thus to shape up another diamond in the process.
While imagination outside or inside the diamond does resemble a flight of fantasy, but as long as you work out the parameters of confirmation or falsification and make out your trading plans based on different scenarios, it will actually help you to plan trading better for the weeks ahead.
This final square has a maximum of three week's shelf life before the diamond is broken either up or down, so be warned, flooding in the moo rivers is to come within the coming three weeks, be ready for some fast and furious actions. We might need a candle specialist to read these three candles for the past three weeks for us.
All momentum indicators are in correlated upstream moo rivers as price, but some are showing signs of waning, mainly rsi, stoch and Elder ray.
Good luck to all bears and bulls.
Thursday 21 May 2009
Daily Moo River Watch on ftse--21st May 2009
FTSE
Hourly
The bullflag shaped between 7th May and 18th May remain intact after this severe bear assault.
RSI: We are W'ing up from a low of 22.9, which is really useful to have for a reversal. While we play the 4300-4500 range, I remember a long while ago half way through this rally from March, I had the inkling that this one will be ended with an expanded triangle topping pattern.
If the bullflag holds tomorrow, then we should aim for 4550/4600 minimum, though I suspect this time we will catch some bears by surprise, possibly ending somewhere between 4700 and 4800 (the flagpole calculation has yielded a bullflag breakout target of 4740).
MACD: possible W there as well, though a weak one to start with;
Momentum: W as well.
In fact, we have W's all over the price and momentum indicators on hourly, and the bullflag holds, which bodes well for the bulls for another run up.
Ideally, in the final square of the diamond, this is the week to reach the top of the square of 4600, so tomorrow might see some dramatic rise, into the UK's bank holiday where UK will be absent from a rising market around the world. It just feels fitting.
You can draw the upstream moo river on hourly rsi as follows:
link up bottom of 4pm on 13th May and 7pm on 15th May to form upperbank 1; parallel to link up top of 9am on 20th May to form upperbank 2 and top of 3pm on 18th May to form upperbank 3, which shouldn't come too useful, unless we go for a dramatic parabolic run.
You can draw similar upstream moo rivers on other momentum indicators as well, particularly on Momentum, repulse and macd. So here we go, for another patient run of 5 waves, perhaps.
Wave 1 from rsi 23 to 73ish; on price, possibly from 4311 to 4460;
Wave 2 from 73ish to 50ish; on price, possibly from 4460 to 4400;
Wave 3 from 50ish into 70's again; on price, possible from 4400 to 4600;
Wave 4 from 70's to 50ish; on price, possibly from 4600 to 4550;
Wave 5 from 50ish to 70's again, on price, possibly from 4550 to 4700/4800 top.
With dow also holding its hourly bullflag with a W's across hourly price, rsi and other momentum indicators, and Hong Kong holds above the upperbank of its old downstream moo river, Japan also has W on its hourly rsi, it seems a global rally is imminent after this healthy pullback. This time, hopefully, we will be going for some big numbers.
good luck and good night.
Hourly
The bullflag shaped between 7th May and 18th May remain intact after this severe bear assault.
RSI: We are W'ing up from a low of 22.9, which is really useful to have for a reversal. While we play the 4300-4500 range, I remember a long while ago half way through this rally from March, I had the inkling that this one will be ended with an expanded triangle topping pattern.
If the bullflag holds tomorrow, then we should aim for 4550/4600 minimum, though I suspect this time we will catch some bears by surprise, possibly ending somewhere between 4700 and 4800 (the flagpole calculation has yielded a bullflag breakout target of 4740).
MACD: possible W there as well, though a weak one to start with;
Momentum: W as well.
In fact, we have W's all over the price and momentum indicators on hourly, and the bullflag holds, which bodes well for the bulls for another run up.
Ideally, in the final square of the diamond, this is the week to reach the top of the square of 4600, so tomorrow might see some dramatic rise, into the UK's bank holiday where UK will be absent from a rising market around the world. It just feels fitting.
You can draw the upstream moo river on hourly rsi as follows:
link up bottom of 4pm on 13th May and 7pm on 15th May to form upperbank 1; parallel to link up top of 9am on 20th May to form upperbank 2 and top of 3pm on 18th May to form upperbank 3, which shouldn't come too useful, unless we go for a dramatic parabolic run.
You can draw similar upstream moo rivers on other momentum indicators as well, particularly on Momentum, repulse and macd. So here we go, for another patient run of 5 waves, perhaps.
Wave 1 from rsi 23 to 73ish; on price, possibly from 4311 to 4460;
Wave 2 from 73ish to 50ish; on price, possibly from 4460 to 4400;
Wave 3 from 50ish into 70's again; on price, possible from 4400 to 4600;
Wave 4 from 70's to 50ish; on price, possibly from 4600 to 4550;
Wave 5 from 50ish to 70's again, on price, possibly from 4550 to 4700/4800 top.
With dow also holding its hourly bullflag with a W's across hourly price, rsi and other momentum indicators, and Hong Kong holds above the upperbank of its old downstream moo river, Japan also has W on its hourly rsi, it seems a global rally is imminent after this healthy pullback. This time, hopefully, we will be going for some big numbers.
good luck and good night.
Wednesday 20 May 2009
Week 20 (17th May-23rd May): Mid-Weekly Moo River Watch on FTSE100
Monthly
While we are still crossing from the lowerbank to the upperbank 2 on monthly rsi, this for me is still very much a buy on dips and dives sort of market condition and so far we have not finished the crossing yet.
Weekly
This is the tricky part.
Price chart: We are in an upstream moo river since the March low. The longer an uptrend holds, the stronger it is and it is at such a healthy angle of +45 degree. I am seeing there are a few more weeks of bull run yet. From a +45 degree rising angle, the moo river could change its course, to a parabolic run of +60 degrees or a softening blow to the bears at +30 degrees. We have not even tried such variation yet to test out the resolve from both sides.
For this week, we are right in the middle of the final square of the diamond, so it won't surprise me if we are stuck in more or less the same range as last week, 4300 and 4500. The candles pattern seems to require this week to be a tight range one, to shape up a bull flag, though the diamond square seems to suggest that this is the week for an attack upon 4600/4800 top. For this week, the maximum range in the diamond square is between 4120 and 4620.
RSI: we are in an upstream, in correlation with the upstream on price, we have also hit upperbank 1 and now has the possibilitiy of shaping up either a M or W, at 54.7, it is still not overly overbought.
1. to shape up an M: rsi might come down to test the old upperbank of the downstream moo river from last year, now resistance turned support at 46.5ish, this will mean a big drop on price in a pullback towards 4180ish.
2. to shape up a W: we drop a little on to 51.7 and then rise up biggish next week, to attach upperbank 1 again at least. This move requires price to hold above 4300.
All the other momentum indicators are stil rising, but a bit toppish.
Daily
We have a pair of correlated W here on price and rsi, which is rather encouraging to bulls. But RSI had a bit of a bender yesterday, if we want to continue this bull run, we must continue the rise today. A pair of correlated W on price and rsi should normally give the bulls a good run of a few hundred points, though this W on rsi is based on 56, so half as leathal.
While on price, the bulls are aggressive, the stories on momentum indicators are a mixed bag of hesitation.
RSI: that W was subject to severe attack from bears yesterday and it is hanging onto lowerbank 1. While we are in the upstream moo rivers here, with rsi having reached 74 early with a M against upperbank 1, it is suggesting a top will be in place shortly. A rise towards 74 might be the trigger for bulls to book profit and bears to jump in for a serious seige.
While I am persisting in buying on dips and dives until we have seen 4600/4800 top, bulls need to be wary of the imminent possibility of a top and a major pullback to keep the bull run a healthy one.
Good luck.
While we are still crossing from the lowerbank to the upperbank 2 on monthly rsi, this for me is still very much a buy on dips and dives sort of market condition and so far we have not finished the crossing yet.
Weekly
This is the tricky part.
Price chart: We are in an upstream moo river since the March low. The longer an uptrend holds, the stronger it is and it is at such a healthy angle of +45 degree. I am seeing there are a few more weeks of bull run yet. From a +45 degree rising angle, the moo river could change its course, to a parabolic run of +60 degrees or a softening blow to the bears at +30 degrees. We have not even tried such variation yet to test out the resolve from both sides.
For this week, we are right in the middle of the final square of the diamond, so it won't surprise me if we are stuck in more or less the same range as last week, 4300 and 4500. The candles pattern seems to require this week to be a tight range one, to shape up a bull flag, though the diamond square seems to suggest that this is the week for an attack upon 4600/4800 top. For this week, the maximum range in the diamond square is between 4120 and 4620.
RSI: we are in an upstream, in correlation with the upstream on price, we have also hit upperbank 1 and now has the possibilitiy of shaping up either a M or W, at 54.7, it is still not overly overbought.
1. to shape up an M: rsi might come down to test the old upperbank of the downstream moo river from last year, now resistance turned support at 46.5ish, this will mean a big drop on price in a pullback towards 4180ish.
2. to shape up a W: we drop a little on to 51.7 and then rise up biggish next week, to attach upperbank 1 again at least. This move requires price to hold above 4300.
All the other momentum indicators are stil rising, but a bit toppish.
Daily
We have a pair of correlated W here on price and rsi, which is rather encouraging to bulls. But RSI had a bit of a bender yesterday, if we want to continue this bull run, we must continue the rise today. A pair of correlated W on price and rsi should normally give the bulls a good run of a few hundred points, though this W on rsi is based on 56, so half as leathal.
While on price, the bulls are aggressive, the stories on momentum indicators are a mixed bag of hesitation.
RSI: that W was subject to severe attack from bears yesterday and it is hanging onto lowerbank 1. While we are in the upstream moo rivers here, with rsi having reached 74 early with a M against upperbank 1, it is suggesting a top will be in place shortly. A rise towards 74 might be the trigger for bulls to book profit and bears to jump in for a serious seige.
While I am persisting in buying on dips and dives until we have seen 4600/4800 top, bulls need to be wary of the imminent possibility of a top and a major pullback to keep the bull run a healthy one.
Good luck.
Tuesday 19 May 2009
Week 20 (17th May-23rd May): Mid-Weekly Moo River Watch on Hangseng42
Greetings to all my visitors from around the world. You are warmly welcome to visit the Moo River Watch HQ, my own unique approach to technical analysis on futures trading of stock market indices, gold, currencies, nymex and VIX.
Let me point out that the weekly moo river watch will be of the highest quality of moo river watch I can produce, because when I do them over the weekend, I am at my best, mentally, physically and psychologically. Please read this midweek update with some more care, because I am quite tired after my day's work and I am psychologically involved with my own daytrading. But I will do my best for you.
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Moo river watch on Asia
Hangseng 42
Monthly
We have had a full crossing in the downstream moo river on price chart, now we have just breached the upperbank there, but there are still quite a few days left in May, a breach of the upperbank can only be confirmed if the monthly candle can stay out the downstream moo river by the end of the month. Momentum indicators are still supportive, e.g., rsi at 48.7 is not too overbought.
Weekly
This is the third candle which is staying outside and above the downstream moo river, which probably means that the bear market in Hong Kong has finished proper. On the rsi, it is stuck in a tight triangle, with potential to shape up a W or M there, very significant indeed. This is the week where we have to answer whether we are going big up or big down. All other indicators are still supportive.
Daily
We have correlated upstream moo rivers across price chart and momentum indicator charts, e.g., rsi, momentum and repulse. Bears are watching closely for any breakdowns, e.g., price dropping below 16800 and rsi below 53.
4hourly and hourly
It looks likely that we will test some downside over night in Hong Kong, 17000 or 16800, though weakness might bring out bargain hunters.
good luck, if you are trading tonight.
Let me point out that the weekly moo river watch will be of the highest quality of moo river watch I can produce, because when I do them over the weekend, I am at my best, mentally, physically and psychologically. Please read this midweek update with some more care, because I am quite tired after my day's work and I am psychologically involved with my own daytrading. But I will do my best for you.
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Moo river watch on Asia
Hangseng 42
Monthly
We have had a full crossing in the downstream moo river on price chart, now we have just breached the upperbank there, but there are still quite a few days left in May, a breach of the upperbank can only be confirmed if the monthly candle can stay out the downstream moo river by the end of the month. Momentum indicators are still supportive, e.g., rsi at 48.7 is not too overbought.
Weekly
This is the third candle which is staying outside and above the downstream moo river, which probably means that the bear market in Hong Kong has finished proper. On the rsi, it is stuck in a tight triangle, with potential to shape up a W or M there, very significant indeed. This is the week where we have to answer whether we are going big up or big down. All other indicators are still supportive.
Daily
We have correlated upstream moo rivers across price chart and momentum indicator charts, e.g., rsi, momentum and repulse. Bears are watching closely for any breakdowns, e.g., price dropping below 16800 and rsi below 53.
4hourly and hourly
It looks likely that we will test some downside over night in Hong Kong, 17000 or 16800, though weakness might bring out bargain hunters.
good luck, if you are trading tonight.
Sunday 17 May 2009
Week 20 (17th May-23rd May): Weekly Moo River Watch on UK (FTSE100)
FTSE100
(based on 30 year advanced data charts)
FTSE is different from Dow in that its yearly rsi is hanging midstream in the downstream moo river there, so in a sense, this one is either vulnerable to another sudden and dramatic drop or it has more bullish intent than Dow and will lead the West out of the recession.
Similar to SPX500, it has found yesteryears' support as key resistance now, as it struggled to get past the bollinger midline at 4568 this year.
Momentum indicators are bearish, so any rallies are bear market rallies.
Wilder's smooth MA line now lies near 4000 as support.
Quarterly
If you compare this year to the last bear market bottom in 2002/2003, what is lacking here on quarterlies are some W's, in particular, we could do with a W on rsi.
Otherwises, we are still very bearish.
Monthly
This is where bulls have finally come out to play. We have correlated W's here, indicating a bounce or a bull run for many a month.
Price chart: we need to break 4680 to confirm the W there.
Rsi: it is supportive of a run at least to challenge 4680, with a breaching of the first resistance line in the form of upperbank 1 and now we are headed for upperbank 2. With such a nicely shaped W there against the lowerbank under 30, there is every hope that price rise might accelerate as we are enjoying a third green monthly candle in a row.
All other momentum indicators are supportive and there is room everywhere for more upside.
Weekly
I have drawn that giant butterfly which gives me an insight into possibilities for years to come, but I will try to avoid to rely on it for now, as we all know what happens when one thinks one can see the future--Martin Armstrong is still in jail. But once I had drawn the butterfly, it does look so similar to his economic confidence model, at least in some ways. I will compare notes with his cycles over time. For now, I will rely on the moo rivers and the more moderate diamond for guidance.
Price chart: we are in an upstream moo river and in a final square of a giant diamond from January 2009. If anything, this is the week for a top near 4600, which is the top of the final square. A delay this week will further strengthen the upstream moo river. At +45 degrees, this is a beautifully shaped upstream moo river. This final square has a top near 4600 and a bottom near 4070, though because we are in an upstream moo river, vertical dropping to 4070 does not happen as a rule, so the maximum downside should be contained above 4180.
If we had poked anywhere near 4600 last week, this bull run could have ended abruptly, as it would have formed a bearish reversal at the top and more falls would have followed. Because we made an inside bar last week, it is likely that we would form a bullish flag here, before a final rise towards 4820ish, where more consolidation will follow.
RSI: we seem to have met resistance of upperbank 1 in the upstream moo river, but at 51.7, it is not really overbought.
Other momentum indicators are still supportive, though repulse seems to be struggling with similar problems as RSI.
Daily
Though we are a much wider upstream moo river, price has managed to stay above the bollinger midline for support, which is also the moo river midline. This is a bullish signal. A break of 4410 this time will take price up to 4550 at least this week. A break below 4290 will widen the price movement and enhances the belief in bears.
RSI: it has come down from an overbought position of 74 to test out the lowerbanks in the upstream moo river and it currently has the potential to shape up a W against lowerbank 1, which will support a more bullish move on price this week.
MACD: it starts to look a bit bearish with a bearish crossing and increasing bearish momentum, though it is hitting a former upperbank, now resistance turned support.
All the other indicators are bearish intended.
4hourly
There is a good case of bullish divergence here, where bulls picked up longs near 4300on strengthening momentum, though there are no upstream moo rivers in sight yet.
Hourly
The key question on hourly is whether the correlated downstream moo river for last week has finished its course yet. On rsi, it seems to say so, but other momentum indicators are yet to be convinced.
A good opening to the week will be critical. A strong Asia will enable ftse100 to turn into a Wave 3 rise in the early week, which might bring forth a key challenge of 4600 as the week's top target.
There is hope for both sides at this very moment, until we wake up in the morning. I have made up my mind based on the bigger picture, which might not turn out to be a winning trading strategy on the short term time frames. But one has to trade on one's own decisions and be prepared for the consequences.
Good luck.
Ps I will be updating the comments section throughout the week. Feel free to join me here.
(based on 30 year advanced data charts)
FTSE is different from Dow in that its yearly rsi is hanging midstream in the downstream moo river there, so in a sense, this one is either vulnerable to another sudden and dramatic drop or it has more bullish intent than Dow and will lead the West out of the recession.
Similar to SPX500, it has found yesteryears' support as key resistance now, as it struggled to get past the bollinger midline at 4568 this year.
Momentum indicators are bearish, so any rallies are bear market rallies.
Wilder's smooth MA line now lies near 4000 as support.
Quarterly
If you compare this year to the last bear market bottom in 2002/2003, what is lacking here on quarterlies are some W's, in particular, we could do with a W on rsi.
Otherwises, we are still very bearish.
Monthly
This is where bulls have finally come out to play. We have correlated W's here, indicating a bounce or a bull run for many a month.
Price chart: we need to break 4680 to confirm the W there.
Rsi: it is supportive of a run at least to challenge 4680, with a breaching of the first resistance line in the form of upperbank 1 and now we are headed for upperbank 2. With such a nicely shaped W there against the lowerbank under 30, there is every hope that price rise might accelerate as we are enjoying a third green monthly candle in a row.
All other momentum indicators are supportive and there is room everywhere for more upside.
Weekly
I have drawn that giant butterfly which gives me an insight into possibilities for years to come, but I will try to avoid to rely on it for now, as we all know what happens when one thinks one can see the future--Martin Armstrong is still in jail. But once I had drawn the butterfly, it does look so similar to his economic confidence model, at least in some ways. I will compare notes with his cycles over time. For now, I will rely on the moo rivers and the more moderate diamond for guidance.
Price chart: we are in an upstream moo river and in a final square of a giant diamond from January 2009. If anything, this is the week for a top near 4600, which is the top of the final square. A delay this week will further strengthen the upstream moo river. At +45 degrees, this is a beautifully shaped upstream moo river. This final square has a top near 4600 and a bottom near 4070, though because we are in an upstream moo river, vertical dropping to 4070 does not happen as a rule, so the maximum downside should be contained above 4180.
If we had poked anywhere near 4600 last week, this bull run could have ended abruptly, as it would have formed a bearish reversal at the top and more falls would have followed. Because we made an inside bar last week, it is likely that we would form a bullish flag here, before a final rise towards 4820ish, where more consolidation will follow.
RSI: we seem to have met resistance of upperbank 1 in the upstream moo river, but at 51.7, it is not really overbought.
Other momentum indicators are still supportive, though repulse seems to be struggling with similar problems as RSI.
Daily
Though we are a much wider upstream moo river, price has managed to stay above the bollinger midline for support, which is also the moo river midline. This is a bullish signal. A break of 4410 this time will take price up to 4550 at least this week. A break below 4290 will widen the price movement and enhances the belief in bears.
RSI: it has come down from an overbought position of 74 to test out the lowerbanks in the upstream moo river and it currently has the potential to shape up a W against lowerbank 1, which will support a more bullish move on price this week.
MACD: it starts to look a bit bearish with a bearish crossing and increasing bearish momentum, though it is hitting a former upperbank, now resistance turned support.
All the other indicators are bearish intended.
4hourly
There is a good case of bullish divergence here, where bulls picked up longs near 4300on strengthening momentum, though there are no upstream moo rivers in sight yet.
Hourly
The key question on hourly is whether the correlated downstream moo river for last week has finished its course yet. On rsi, it seems to say so, but other momentum indicators are yet to be convinced.
A good opening to the week will be critical. A strong Asia will enable ftse100 to turn into a Wave 3 rise in the early week, which might bring forth a key challenge of 4600 as the week's top target.
There is hope for both sides at this very moment, until we wake up in the morning. I have made up my mind based on the bigger picture, which might not turn out to be a winning trading strategy on the short term time frames. But one has to trade on one's own decisions and be prepared for the consequences.
Good luck.
Ps I will be updating the comments section throughout the week. Feel free to join me here.
Week 20 (17th May-23rd May): Weekly Moo River Watch on America (dow)
Dow
(based on 30 year advanced data charts)
Yearly
Dow is slightly different from SPX500. This one stands upon Wilder's smooth moving average and has managed to get above the bollinger midline, yesteryears' support, which is again turning into a support near the psychologically important 8000.
The most puzzling thing on yearly is the RSI which is lying on the lowerbank in the downstream moo river from 2008. Well, they say even dead cats hit the ground and would have bounced up, but dow did not and it seems it is lying there quite cosily. All the other momentum indicators are still bearish. So what is happening to dow?
On the price chart, if we can stay above 8000, ultimately this year, we could top out near 11228, that is when the RSI finally decide to raise itself off that lowerbank.
Quarterly
Let's make no bones about it, there are absolutely no upstream moo rivers here, on price or on all momentum indicators. So it is a bear market rally we are having here.
Price chart: an initial challenge is near 8828, though 9000 is a big number which tickles a few fancies. Ultimately, a challenge of 10000 is more interesting a challenge.
There are no correlated W's to support any bullish fantasies yet.
Monthly
If you look at the RSI chart, you realised that we have just avoided a major calamity in March 2009, as we are stuck in history's biggest downstream moo river with four banks altogether, two upperbanks and two lowerbanks. In March, we almost fell through the lowerbank 1, towards lowerbank 2, until someone realised that we were headed for zero or minus, which was mathematically improbable. Now, we have just risen through the floor of 30 and is headed to a more healthy 40, where the challenge for the bulls' resolve will be immense and there is no guarantee for an instant success there. We might have to come back and shape up a W to rally through 40 onto more happy days for bulls.
If you look across the monthlies, it is not very satisfactory for bulls with the lack of W's there and everywhere you look, it feels like two arms short of a healthy and bullish W, which means another dive down and a quick rise up, but the timing of it is unclear, unless it is a V shaped rally.
Weekly
It looks so similar to SPX500. It stares at you that a very volatile week is coming up, either a big up or a big down, and there is no third way about it.
How spooky it is that we closed Friday at 8288! One wonders whether this global stock market rally is conducted by a Chinese!
I will put some weekly numbers in the weekly forecasts and results post later on.
Good luck.
(based on 30 year advanced data charts)
Yearly
Dow is slightly different from SPX500. This one stands upon Wilder's smooth moving average and has managed to get above the bollinger midline, yesteryears' support, which is again turning into a support near the psychologically important 8000.
The most puzzling thing on yearly is the RSI which is lying on the lowerbank in the downstream moo river from 2008. Well, they say even dead cats hit the ground and would have bounced up, but dow did not and it seems it is lying there quite cosily. All the other momentum indicators are still bearish. So what is happening to dow?
On the price chart, if we can stay above 8000, ultimately this year, we could top out near 11228, that is when the RSI finally decide to raise itself off that lowerbank.
Quarterly
Let's make no bones about it, there are absolutely no upstream moo rivers here, on price or on all momentum indicators. So it is a bear market rally we are having here.
Price chart: an initial challenge is near 8828, though 9000 is a big number which tickles a few fancies. Ultimately, a challenge of 10000 is more interesting a challenge.
There are no correlated W's to support any bullish fantasies yet.
Monthly
If you look at the RSI chart, you realised that we have just avoided a major calamity in March 2009, as we are stuck in history's biggest downstream moo river with four banks altogether, two upperbanks and two lowerbanks. In March, we almost fell through the lowerbank 1, towards lowerbank 2, until someone realised that we were headed for zero or minus, which was mathematically improbable. Now, we have just risen through the floor of 30 and is headed to a more healthy 40, where the challenge for the bulls' resolve will be immense and there is no guarantee for an instant success there. We might have to come back and shape up a W to rally through 40 onto more happy days for bulls.
If you look across the monthlies, it is not very satisfactory for bulls with the lack of W's there and everywhere you look, it feels like two arms short of a healthy and bullish W, which means another dive down and a quick rise up, but the timing of it is unclear, unless it is a V shaped rally.
Weekly
It looks so similar to SPX500. It stares at you that a very volatile week is coming up, either a big up or a big down, and there is no third way about it.
How spooky it is that we closed Friday at 8288! One wonders whether this global stock market rally is conducted by a Chinese!
I will put some weekly numbers in the weekly forecasts and results post later on.
Good luck.
Week 20 (17th May-23rd May): Weekly Moo River Watch on America (SPX500)
SPX500
(based on 30 year advanced data charts)
Yearly
It is a classic case of yesteryears' support turned into resistance as we have been suffocated under the bollinger midline here.
All momentum indicators are bearish, guess it just confirms the fact that we are stuck in a bear market, some call it the greatest bear market in history, only if you are a bear a perpetual pessimist.
Quarterly
Strangely, the price chart somehow looks like a flat battle zone between bulls and bear, from Q2 in 1997 to date, where we are basically stuck between 1546 top and 772 bottom.
For the same price range, it seems that momentums have collapsed even deeper down to seek support for a bounce this time round. so in terms of momentum indicators, it does not present a flat battlezone. It is quite tricky, either it is an ABC corrective wave before we push for more historical highs, or it is a 5 wave impulsive move down, to push the market into levels not seen for decades.
The election of Obama as the first black US president is indeed a historical event, as he takes on a historical challenge, either to continue this productivity push into unknown territory or to prove there is a limit to growth, even for an Empire like the United States.
Monthly
The bullish signals are here that we could have ended the bear market in March already, if you like to draw parallel lessons from 2002/2003.
Here are the similarities:
1. the layout of the candles are of a similar pattern, with a green candle for the bottom of the bear market. In truth, this bounce is even stronger.
2. rsi and other momentum indicators are all showing similar reversal patterns and this time, the W on rsi is more obvious and better formed.
Still, even though we might speculate we have seen the lowest of the bear market already, if history is any guide, then there will be another dive to sub 800 level, just to find out the resolve of the bulls. It is suggesting midsummer challenge to any over-enthusiastic bulls.
For now, rsi has just carved through 30 and stoc is climbing out of the bottomline, so a near term challenge of 960ish is imminent on the price chart, though psychologically, one wonders whether an overdrive to kiss upon 1000 is also a plausible prospect, though not supported by historical evidence.
Weekly
This is where the drama kicks in. Looking across the price and momentum indicators, it seems that it might surprise some laidback bears here with a dramatic rise this week, out of the blue, almost. Either that or we test the key support of the bollinger midline near 835, which will bring rsi to a challenge of 40, but there, there is a room for a big surprise as the upstream moo river has two upperbanks and one lowerbank. We carved through upperbank 1 in Week 13 and is now lying upon it for support. A dramatic Monday overnight in Asia will take bulls to heady heights with little pullback.
This week is not for the faint hearted.
Good luck.
(based on 30 year advanced data charts)
Yearly
It is a classic case of yesteryears' support turned into resistance as we have been suffocated under the bollinger midline here.
All momentum indicators are bearish, guess it just confirms the fact that we are stuck in a bear market, some call it the greatest bear market in history, only if you are a bear a perpetual pessimist.
Quarterly
Strangely, the price chart somehow looks like a flat battle zone between bulls and bear, from Q2 in 1997 to date, where we are basically stuck between 1546 top and 772 bottom.
For the same price range, it seems that momentums have collapsed even deeper down to seek support for a bounce this time round. so in terms of momentum indicators, it does not present a flat battlezone. It is quite tricky, either it is an ABC corrective wave before we push for more historical highs, or it is a 5 wave impulsive move down, to push the market into levels not seen for decades.
The election of Obama as the first black US president is indeed a historical event, as he takes on a historical challenge, either to continue this productivity push into unknown territory or to prove there is a limit to growth, even for an Empire like the United States.
Monthly
The bullish signals are here that we could have ended the bear market in March already, if you like to draw parallel lessons from 2002/2003.
Here are the similarities:
1. the layout of the candles are of a similar pattern, with a green candle for the bottom of the bear market. In truth, this bounce is even stronger.
2. rsi and other momentum indicators are all showing similar reversal patterns and this time, the W on rsi is more obvious and better formed.
Still, even though we might speculate we have seen the lowest of the bear market already, if history is any guide, then there will be another dive to sub 800 level, just to find out the resolve of the bulls. It is suggesting midsummer challenge to any over-enthusiastic bulls.
For now, rsi has just carved through 30 and stoc is climbing out of the bottomline, so a near term challenge of 960ish is imminent on the price chart, though psychologically, one wonders whether an overdrive to kiss upon 1000 is also a plausible prospect, though not supported by historical evidence.
Weekly
This is where the drama kicks in. Looking across the price and momentum indicators, it seems that it might surprise some laidback bears here with a dramatic rise this week, out of the blue, almost. Either that or we test the key support of the bollinger midline near 835, which will bring rsi to a challenge of 40, but there, there is a room for a big surprise as the upstream moo river has two upperbanks and one lowerbank. We carved through upperbank 1 in Week 13 and is now lying upon it for support. A dramatic Monday overnight in Asia will take bulls to heady heights with little pullback.
This week is not for the faint hearted.
Good luck.
Week 20 (17th May-23rd May): Weekly Moo River Watch on Wealth (gold)
Gold (SPOT)
(based on 30 year advanced data charts)
Yearly
If you look at the yearly chart, you would say to yourself how you missed this glistening run for the past decade and you would wonder whether it is too late to join in the bull run.
To date, on the yearly, there is no sign that this bull run has ended, as we have made another higher high this year and so far the low is a higher low against last year's as well. All the candles are green, supported by green para sar dots.
However, yearly rsi has been stuck above 70 since 2006 and you would imagine when it does come down 70, it will alert many long term bears.
Quarterly
Things are not so right for aggressive bulls (those who buy on dips and dives to build up a large gold long position, without ever taking profit, following a superbull market strategy which has served them very well indeed).
There appear three red para sar dots and a few of the momentum indicators are pointing downwards.
Price chart: We have had a rare or first 350 pointer pullback, which is alarming. In a superbull run, nobody gets off the bus, or the next stop will be higher as has been the case for the past decade. Is this just a pause in the superbull run or the end? That is the billion dollar question.
The answer lies in the chart pattern of this top, whether it is a reversal pattern or a continuation pattern, at the moment, it appears more like a reversal pattern to my eyes.
And the answer also lies in the upstream moo river on RSI, as it has topped out at 89 and is now on its way to its lowerbank near 70ish, a breakdown through will set bears pulse racing wildly.
Certainly, the other momentum indicators are pointing to a waning bullish momentum at least.
We are undecided here on quarterly.
Monthly
There is always a debate about the relationship between the past and the future, which one determines which. In term of the science of the human gene, a lot of what we do in life is actually predetermined by our historical gene. In term of sociology, it is our interaction with the environment (social environment) that enables us to adapt, change and behave in the way we do. So here we have this paradox between monthly and more longer-term charts, does the monthly determine the latter or does the latter prescribe the monthly?
Monthly rsi has already made up its mind. It has fallen through the long running upstream moo river in July 2008 and has now completed its first wave down and possibly the second wave pullback.
From here onwards, there are two possibilities:
1. This is an ABC corrective wave, so following another dive towards 655 dollars, the bull run will resume;
2. This is a 5 Wave impulsive wave in a complete reversal of the superbull run. Thus we will see a much deeper Wave 3 to come, followed by more falls towards levels unimginable by the aggressive bulls at the moment.
The problem is when it becomes crystal clear which one is which, it might already be too late for some investors.
Weekly
The downturn here is more obvious and more persistent as we have a clear downstream moo river on rsi. At the moment, we are crossing over from the lowerbank towards the upperbank, but other momentum indicators are more bearish than bullish, indicating a continuation of this downstream moo river. When it does go down, this time, it might reflect severely in terms of price, as bulls rush out of the exit en masse.
To me, from here onwards, all that glistens might not be the true gold.
Good luck.
(based on 30 year advanced data charts)
Yearly
If you look at the yearly chart, you would say to yourself how you missed this glistening run for the past decade and you would wonder whether it is too late to join in the bull run.
To date, on the yearly, there is no sign that this bull run has ended, as we have made another higher high this year and so far the low is a higher low against last year's as well. All the candles are green, supported by green para sar dots.
However, yearly rsi has been stuck above 70 since 2006 and you would imagine when it does come down 70, it will alert many long term bears.
Quarterly
Things are not so right for aggressive bulls (those who buy on dips and dives to build up a large gold long position, without ever taking profit, following a superbull market strategy which has served them very well indeed).
There appear three red para sar dots and a few of the momentum indicators are pointing downwards.
Price chart: We have had a rare or first 350 pointer pullback, which is alarming. In a superbull run, nobody gets off the bus, or the next stop will be higher as has been the case for the past decade. Is this just a pause in the superbull run or the end? That is the billion dollar question.
The answer lies in the chart pattern of this top, whether it is a reversal pattern or a continuation pattern, at the moment, it appears more like a reversal pattern to my eyes.
And the answer also lies in the upstream moo river on RSI, as it has topped out at 89 and is now on its way to its lowerbank near 70ish, a breakdown through will set bears pulse racing wildly.
Certainly, the other momentum indicators are pointing to a waning bullish momentum at least.
We are undecided here on quarterly.
Monthly
There is always a debate about the relationship between the past and the future, which one determines which. In term of the science of the human gene, a lot of what we do in life is actually predetermined by our historical gene. In term of sociology, it is our interaction with the environment (social environment) that enables us to adapt, change and behave in the way we do. So here we have this paradox between monthly and more longer-term charts, does the monthly determine the latter or does the latter prescribe the monthly?
Monthly rsi has already made up its mind. It has fallen through the long running upstream moo river in July 2008 and has now completed its first wave down and possibly the second wave pullback.
From here onwards, there are two possibilities:
1. This is an ABC corrective wave, so following another dive towards 655 dollars, the bull run will resume;
2. This is a 5 Wave impulsive wave in a complete reversal of the superbull run. Thus we will see a much deeper Wave 3 to come, followed by more falls towards levels unimginable by the aggressive bulls at the moment.
The problem is when it becomes crystal clear which one is which, it might already be too late for some investors.
Weekly
The downturn here is more obvious and more persistent as we have a clear downstream moo river on rsi. At the moment, we are crossing over from the lowerbank towards the upperbank, but other momentum indicators are more bearish than bullish, indicating a continuation of this downstream moo river. When it does go down, this time, it might reflect severely in terms of price, as bulls rush out of the exit en masse.
To me, from here onwards, all that glistens might not be the true gold.
Good luck.
Week 20 (17th May-23rd May): Weekly Moo River Watch on Wealth (oil and VIX)
Nymex (JULY 09)
4 hourly
At 8am on 13th May, oil finished its recent bull run as it broke down from a top price of 60.68 dollars.
It now has correlated downstream moo rivers on price and momentum indicators, also showing signs of acceleration in the pace of the downturn as well.
But with rsi also hitting 30, I am wondering whether we are going to see a sharp bounce based on bearish momentums to create one super bearish divergence between momentum and price.
Oil seems to suggest a weak week opening, following by a sharp rally back.
Hourly
We have hit the lowerbank on price in the downstream moo river. A rise on Monday towards 59 dollars will be sold by aggressive bears. There is a W on elder ray, rsi is already under 30.
There is conflict between 4 hourly and hourly, so neither will be able to generate a significant rally either way in the coming week, though once a surprising spike or dive taking place, it might induce a counter-reaction in the opposite way.
Oil seems to be headed towards an up and down or down and up week.
===============================================
VIX (May 09)
Daily
We have come down along the lower bollinger slope at a healthy bearish angle since the end of April and now it seems that we are stuck in a flat bearbull zone, a rectangle. In a trending market, a rectangle is a continuation pattern. While the market dithers between 30 and 34, the momentum indicators are trying to bend up and rebel. Rectangles are bear market rallies, which give false hope to the bulls.
Looking at the long-term chart on Yahoo finance, it is almost like looking at the mirror copy of last year's stock market, surely the most naturaly course is for the VIX to return to its norm range between 10 and 30.
Hourly
Monday is really important for VIX, an early rise there will falsify the possiblity of a reveral towards 30 again.
On the hourly rsi, it seems to have hit the upperbank once on Friday and has the potential to shape up an upperbank rejection M there, which will take VIX quite sigificantly.
Monday seems to be one of those deciding day again.
4 hourly
At 8am on 13th May, oil finished its recent bull run as it broke down from a top price of 60.68 dollars.
It now has correlated downstream moo rivers on price and momentum indicators, also showing signs of acceleration in the pace of the downturn as well.
But with rsi also hitting 30, I am wondering whether we are going to see a sharp bounce based on bearish momentums to create one super bearish divergence between momentum and price.
Oil seems to suggest a weak week opening, following by a sharp rally back.
Hourly
We have hit the lowerbank on price in the downstream moo river. A rise on Monday towards 59 dollars will be sold by aggressive bears. There is a W on elder ray, rsi is already under 30.
There is conflict between 4 hourly and hourly, so neither will be able to generate a significant rally either way in the coming week, though once a surprising spike or dive taking place, it might induce a counter-reaction in the opposite way.
Oil seems to be headed towards an up and down or down and up week.
===============================================
VIX (May 09)
Daily
We have come down along the lower bollinger slope at a healthy bearish angle since the end of April and now it seems that we are stuck in a flat bearbull zone, a rectangle. In a trending market, a rectangle is a continuation pattern. While the market dithers between 30 and 34, the momentum indicators are trying to bend up and rebel. Rectangles are bear market rallies, which give false hope to the bulls.
Looking at the long-term chart on Yahoo finance, it is almost like looking at the mirror copy of last year's stock market, surely the most naturaly course is for the VIX to return to its norm range between 10 and 30.
Hourly
Monday is really important for VIX, an early rise there will falsify the possiblity of a reveral towards 30 again.
On the hourly rsi, it seems to have hit the upperbank once on Friday and has the potential to shape up an upperbank rejection M there, which will take VIX quite sigificantly.
Monday seems to be one of those deciding day again.
Week 20 (17th May-23rd May): Weekly Moo River Watch on Wealth (Currencies)
Cable (Sterling/dollar)
(based on 30 year advanced data charts)
Yearly
We are trying very hard to pull away the lower bollinger band towards the bollinger midline near $1.67. A challenge there is inevitable before cable's fate can be decided, parity or back to $2. Cable could be wild as well, so there is no half-way solution this year. Before the end of 2009, we would have seen either $2 again or parity, which would be a shocker and satisfying to the likes George Soros.
Momentum indicators are not bullishly configured, so the bear market is the big theme here, business as usual.
Quarterly
There are a few things to note, if you are a bull on cable.
Price chart: we are possibly shaping up a reversal pattern here, with last quarter's doji candle and this quarter's rise so far.
Rsi: it has bounced off 32ish, though not based on a proper W,it is still a good bounce;
MACD: the bearish momentum from Q4 2008 was so severe that it has probably shot itself in the foot, now price might meander and recover based on waning bearish momentum (note: not on bullish momentum, but on waning bearish momentum), until there comes a point that market must decide whether it has actually said goodbye to the bear market in Q1 2009 and has now entered a bull market. When it does show plenty of evidence of that, it will be too late for some heavily leveraged bears. The truth hurts, particularly if it takes ages for one to realise it.
Elder Ray is also bending up.
Other momentum indicators are still bearish. So overall, a mixed bag of signals: is this a bear market rally on the way to parity, or a new bull market towards $2 again.
Monthly
If you are a bull on cable, your eyes start to light up here, as there is more evidence of bullishness.
Price: we have managed to disentangle ourselves from the lower bollinger band, though there is no W there.
RSI: when we reached parity last time in 1985, rsi reached 16.68 and this time, we hit even lower at 15.9. A rise through 30 will be very significant indeed. There is no W shape there though.
MACD: it is confirming waning bearish momentum for now.
All other momentum indicators are bending up, with a possible W on elder ray.
Overall, it tells a story of being way oversold at too fast a pace, rather than of any bullish momentums.
Weekly
While bulls must constrain their enthusiasm due to the fact that we have established any upstream moo rivers yet, but the bullish signals here are very strong and visible indeed.
Price chart: the bounce came off a good W, with a continuation W, which took the price straight to the upper bollinger band. This is a strong rally, which merits either a continuation here along the upper bollinger band or at least a flat bullbear battle zone, above bollinger midline near $1.45ish. Para sar dots are getting used to being green a significant change. To date, it is not yet possible to establish upstream moo river there, only a crossing in the ongoing downstream moo rivers (yes, there are a good number of them downstream moo rivers from way back).
RSI: We have bounced off the lowerbank in a ginormous downstream moo river and we are crossing over to the upperbank and there is still some distance from here to the upperbank yet. Without breaking this ongoing downstream moo river, we can not yet draw an upstream moo river. There it lies the danger, once we are ready to draw the upstream moo river, for the heavily leveraged bears, it might be too late.
MACD: it is indicating future price rises might be based on waning bullish momentum, suggesting we are headed for a topping exercise in the not too distant future.
All other momentum indicators are bullishly configured and supportive, with repulse being a straight V shaped rally.
(based on 30 year advanced data charts)
Yearly
We are trying very hard to pull away the lower bollinger band towards the bollinger midline near $1.67. A challenge there is inevitable before cable's fate can be decided, parity or back to $2. Cable could be wild as well, so there is no half-way solution this year. Before the end of 2009, we would have seen either $2 again or parity, which would be a shocker and satisfying to the likes George Soros.
Momentum indicators are not bullishly configured, so the bear market is the big theme here, business as usual.
Quarterly
There are a few things to note, if you are a bull on cable.
Price chart: we are possibly shaping up a reversal pattern here, with last quarter's doji candle and this quarter's rise so far.
Rsi: it has bounced off 32ish, though not based on a proper W,it is still a good bounce;
MACD: the bearish momentum from Q4 2008 was so severe that it has probably shot itself in the foot, now price might meander and recover based on waning bearish momentum (note: not on bullish momentum, but on waning bearish momentum), until there comes a point that market must decide whether it has actually said goodbye to the bear market in Q1 2009 and has now entered a bull market. When it does show plenty of evidence of that, it will be too late for some heavily leveraged bears. The truth hurts, particularly if it takes ages for one to realise it.
Elder Ray is also bending up.
Other momentum indicators are still bearish. So overall, a mixed bag of signals: is this a bear market rally on the way to parity, or a new bull market towards $2 again.
Monthly
If you are a bull on cable, your eyes start to light up here, as there is more evidence of bullishness.
Price: we have managed to disentangle ourselves from the lower bollinger band, though there is no W there.
RSI: when we reached parity last time in 1985, rsi reached 16.68 and this time, we hit even lower at 15.9. A rise through 30 will be very significant indeed. There is no W shape there though.
MACD: it is confirming waning bearish momentum for now.
All other momentum indicators are bending up, with a possible W on elder ray.
Overall, it tells a story of being way oversold at too fast a pace, rather than of any bullish momentums.
Weekly
While bulls must constrain their enthusiasm due to the fact that we have established any upstream moo rivers yet, but the bullish signals here are very strong and visible indeed.
Price chart: the bounce came off a good W, with a continuation W, which took the price straight to the upper bollinger band. This is a strong rally, which merits either a continuation here along the upper bollinger band or at least a flat bullbear battle zone, above bollinger midline near $1.45ish. Para sar dots are getting used to being green a significant change. To date, it is not yet possible to establish upstream moo river there, only a crossing in the ongoing downstream moo rivers (yes, there are a good number of them downstream moo rivers from way back).
RSI: We have bounced off the lowerbank in a ginormous downstream moo river and we are crossing over to the upperbank and there is still some distance from here to the upperbank yet. Without breaking this ongoing downstream moo river, we can not yet draw an upstream moo river. There it lies the danger, once we are ready to draw the upstream moo river, for the heavily leveraged bears, it might be too late.
MACD: it is indicating future price rises might be based on waning bullish momentum, suggesting we are headed for a topping exercise in the not too distant future.
All other momentum indicators are bullishly configured and supportive, with repulse being a straight V shaped rally.
Week 20 (17th May-23rd May): Weekly Moo River Watch on UK Banks
I have decided to start a Weekly moo river watch on UK private banks, namely, Barclays, HSBC and Standard Chartered, all based on 30-year advanced chart data.
----------------------------------------
Barclays Bank
Yearly
We have had three continuous years where we had lower lows and this year is no exception. To end this bear market, we need to get over last year's high at 524.5 pence a share to create a higher high to start a bull run.
Quarterly
We are still stuck in a ginormous downstream moo river since Q4 2006. I think 2006 was when the housing market in the UK was showing signs of topping, but everyone chose to ignore it, even the bank managers. We are testing the upperbank at the moment, a break is required to start a bull run, where people get more comfortable in seeing Barclays shares in the 300's pence league.
Momentum indicators are not particularly bullish yet. RSI has tentatively broken out of the downstream moo river recently and it will be interesting to keep an eye on this one.
Monthly
Bulls will be encouraged by the bullish signals here.
Price has broken the long running downstream moo river, rsi has broken its downstream moo river and Momentum Indicator had an odd-looking W to bounce up and all indicators are supportive.
Banks are really the driving forces of this current stock market rally and they have certainly gone ahead of the rest of the market.
Weekly
If you look back at what happened in 2003 bear market bottom and the rally since, you would see that we are possibly at the beginning of this recovery. Price should recover up to 61.8% fib level of the last cliff drop in 2008, that is 314 pence a share, while the 2003 bear market low was 319 pence a share. So that should really be the minimum or even the maximum target for this current rally.
I am holding 5k worth in this share at an average of 245 pence a share. I will hold onto them either seeing weekly rsi hitting 70 or seeing price reaching into 320 level.
Updated on 16th May 2009
If you look at the weekly price chart, this current bull run is even stronger than the one in 2003 at the end of that particular bull market, at a sharper angle. This currently rising angle can not be sustained, so we are looking for a parabolic top to finish this bull run, which I think will take weekly rsi to 70. After that, we might meander between 235 pence and 345 pence, at a more healthy rising angle of perhap +45 degree and eventually, we might come back to a +30 rising angle into many months ahead.
The medium price target might be £476 pence and the long term price target could be £739 pence a share, which could years to realise.
Daily
We do have correlated moo rivers on price and momentum indicators, particularly rsi. Ideally, rsi could do with touching the lowerbank near 48 or touching 53 again to form a W there. Some early week weakness on price would complete the movement there.
On the price chart, it looks more like that the top of this current run might come on 20th or 21st May.
Hourly
We have left an unfilled gap between 259 pence and 263 pence. On the rsi, we are stuck in a downstream moo river, which provides two possible scenarios for Monday:
1. a break of hourly rsi 63 to give us a dramatic rise towards 85 again to reach price of 320 pence or more;
2. a failure at hourly rsi of 62 brings the price down to fill in that gap and perhaps gives 236 another challenge. If 236 pence does not hold, the next buying price for me will be 193 pence a share and the next support will be 150 pence.
It all depends on Asia as well as any more news from Barclays itself. Barclays is in a sustainable bull run, because there is a continuous newsflow, a good support from a large number of retail investors and the imminent change to paying dividends to investors.
================================
Standard Chartered
Yearly
We have a green candle bar but a red para sar dot, but it is a long year, so difficult to draw any conclusions there. We did make a lower low this year against the low of 2008.
Quarterly
We had a doji last quarter and now we have a reversal pattern on the candles.
Rsi caved in from a high of 77 to about 40 and bounced off, which is very interesting to note. It seems to suggest that it is only a pullback in a healthy bull run.
Momentum indicators are mostly supportive.
Monthly
A few correlated oddly-shaped W's on price and momentum indicators.
You can easily draw the downstream moo river on rsi by linking up tops of M's and bottoms of W's, it is such a well formed river, that you do wonder who has been charting it all along. As you can see, we are not out of the downstream moo river yet, facing an immediate upperbank resistance near 52ish, a breach of which will be significant.
But price has already broken its down stream moo river and has so far this month stayed above the breached former upperbank for support, which is encouraging. You can draw a tentative upstream moo river at +45 degrees and it gives us an upperbank touch in the near term at 1490ish.
Weekly
This is all bullsland, with everything pointing upwards.
Price: we broke a basing diamond and are now in a second diamond with an upperside wall resistance near 1580. Somehow, in our haste to get out of the old diamond, we have left a gap 1082 and 1095, which has not been filled.
Rsi: the bullish momentum started with the small W in October 2008 and we have done through one flattish basing upstream moo river and have now risen to a much sharper upstream moo river. I think we are headed into 70's, despite current resistance.
All momentum indicators are supportive.
=========
Updated 17th May 2009:
Daily
While the correlated moo rivers on price and momentum indicators are upwards, we did hit 75 on rsi, which is quite a toppish figure. While price might still move a bit further higher, the momentum indicators are wanting a pullback to be healthy, for example, RSI could have a touchdown at the lowerbank of this upstream moo river at 49.7, which will in turn bring the price down to fill in that gap between 1082 and 1095 pence. A challenge of 1000 pence psychological support is not a bad idea.
I have drawn an upstream moo river on price: you link up candle tops on 7th Jan and 7th May, which serves as our upperbank in the upstream moo river; then you use parallel lines to form three lowerbanks for support, lowerbank 1 links up candle bottom on 19th December; lowerbank 2 links up candle bottom on 21st Jan; and lowerbank 3 links up candle bottom on 3rd Mar.
When price hit the upperbank in an upstream moo river, it tends to meander across to hit one of the lowerbanks to find further support, though it is always possible to touch the upperbank one or more times to find out whether that is indeed the limit for this run.
While the maximum drop from the upperbank to lowerbank 3 is from 1337 pence top to 760 pence bottom, in an upstream moo river, it does not tend to behave like that. so I am seeing 1000 pence as a good support or alternatively 888 pence should hold any pullbacks.
You can certainly draw the upstream moo rivers on rsi, macd, momentum and repulse indicators.
Hourly
RSI dropped out of the upstream moo river and a few indicators are bearishly poised. On Monday, the possibilities are:
1. a good opening higher will shape up a W on rsi and Momentum, giving us another rise towards 1350 pence top;
2. a poor opening eliminates the potential shaping of the W's, which will bring the price down to challenge 1100 pence and finally 1000 pence, the psychological support area.
All eyes will be on Hong Kong and China and the rest of the Asia on Monday.
==========================================
HSBC
Yearly
The downturn on this share actually stared in 2006, when we had a yearly doji candle and a reversal started then, not noticed by many.
Since then, we have had three red para sar dots with price more than halved from its 2006 top 1028 pence a share. The downtrend has been relentless with lower highs and lower lows for the past three years, including this year. If we can not breach 938 pence a share, we are still very much stuck in this ginormous downtrend.
Quarterly
It is pleasing to the bulls that we have not made a lower low here so far and has managed to hug back to the bollinger lowerbank for a lifeline, though momentum indicators are still weak.
Monthly
There are no significant bullish signals like correlated W's on price or momentum indicators.
You can draw that downstream moo river on rsi, which is quite an obvious one and we have bounced up from lowerbank 1 towards upperbank and we have not finished the job yet. So it is a downstream moo river with one upperbank and two lowerbanks, though lowerbank 2 is not too low or too close to zero to be a valid bank any more.
Momentum indicators are trying to bounce up and there is a W bounce on elder ray, which is useful.
Weekly
This has been the bullpark for the past 9 weeks as price almost doubled up from its March low. The upper bollingerband is near 664 pence a share.
But we do have some resistances at the moment. RSI is hitting the last upperbank in the downstream moo rivers, but fortunately it is only 49.5, so still some room to manoevour.
MACD is bullishly crossed and every other indicator is still supportive. There are no M's or correlated M's in sight, so bulls can breathe and enjoy their bull run by buying on dips and dives for a while yet.
Much should come as guidance from the monthly rsi downstream moo river, watch that one closely.
========
Updated on 17th May.
Daily
On the price chart, you can draw a similar upstream moo river as of Standard Chartered, this time, with two upperbanks and one lowerbank. We hit upperbank 1 at 583 on 8th May and the upperbank 2 is a higher one and lowerbank for Monday is near 488 pence and there is also a historical support near 437 (from a breached triangle upperbank from 3rd October 2008).
You can draw similar upstream moo rivers on momentum indicators as well and it is quite clear that they all had a first rejection by an upperbank last week, which seems to suggest either another challenge of the upper limit at the upperbanks or pulling back further to find key support somewhere.
I reckon on the price, there is an unfilled gap as well between 489 and 496 pence.
Hourly
For Monday, the possibilities are as follows:
1. a good start brings forth W's on Elder ray and Momentum Indicator, which takes price for another challenge of upperbank 1 near 608 pence;
2. a test of lowerbank in the upstream moo river on hourly near 489 pence.
The momentum indicators are all over the place, not giving out strong signals for either side, so it is more likely that the pullback on price might continue, as we tested upperbank on 8th May. A meandering crossing from upperbank to lowerbank in an upstream moo river is a healthy pullback, a breach of banks is an important signal to watch out for breakout trades.
----------------------------------------
Barclays Bank
Yearly
We have had three continuous years where we had lower lows and this year is no exception. To end this bear market, we need to get over last year's high at 524.5 pence a share to create a higher high to start a bull run.
Quarterly
We are still stuck in a ginormous downstream moo river since Q4 2006. I think 2006 was when the housing market in the UK was showing signs of topping, but everyone chose to ignore it, even the bank managers. We are testing the upperbank at the moment, a break is required to start a bull run, where people get more comfortable in seeing Barclays shares in the 300's pence league.
Momentum indicators are not particularly bullish yet. RSI has tentatively broken out of the downstream moo river recently and it will be interesting to keep an eye on this one.
Monthly
Bulls will be encouraged by the bullish signals here.
Price has broken the long running downstream moo river, rsi has broken its downstream moo river and Momentum Indicator had an odd-looking W to bounce up and all indicators are supportive.
Banks are really the driving forces of this current stock market rally and they have certainly gone ahead of the rest of the market.
Weekly
If you look back at what happened in 2003 bear market bottom and the rally since, you would see that we are possibly at the beginning of this recovery. Price should recover up to 61.8% fib level of the last cliff drop in 2008, that is 314 pence a share, while the 2003 bear market low was 319 pence a share. So that should really be the minimum or even the maximum target for this current rally.
I am holding 5k worth in this share at an average of 245 pence a share. I will hold onto them either seeing weekly rsi hitting 70 or seeing price reaching into 320 level.
Updated on 16th May 2009
If you look at the weekly price chart, this current bull run is even stronger than the one in 2003 at the end of that particular bull market, at a sharper angle. This currently rising angle can not be sustained, so we are looking for a parabolic top to finish this bull run, which I think will take weekly rsi to 70. After that, we might meander between 235 pence and 345 pence, at a more healthy rising angle of perhap +45 degree and eventually, we might come back to a +30 rising angle into many months ahead.
The medium price target might be £476 pence and the long term price target could be £739 pence a share, which could years to realise.
Daily
We do have correlated moo rivers on price and momentum indicators, particularly rsi. Ideally, rsi could do with touching the lowerbank near 48 or touching 53 again to form a W there. Some early week weakness on price would complete the movement there.
On the price chart, it looks more like that the top of this current run might come on 20th or 21st May.
Hourly
We have left an unfilled gap between 259 pence and 263 pence. On the rsi, we are stuck in a downstream moo river, which provides two possible scenarios for Monday:
1. a break of hourly rsi 63 to give us a dramatic rise towards 85 again to reach price of 320 pence or more;
2. a failure at hourly rsi of 62 brings the price down to fill in that gap and perhaps gives 236 another challenge. If 236 pence does not hold, the next buying price for me will be 193 pence a share and the next support will be 150 pence.
It all depends on Asia as well as any more news from Barclays itself. Barclays is in a sustainable bull run, because there is a continuous newsflow, a good support from a large number of retail investors and the imminent change to paying dividends to investors.
================================
Standard Chartered
Yearly
We have a green candle bar but a red para sar dot, but it is a long year, so difficult to draw any conclusions there. We did make a lower low this year against the low of 2008.
Quarterly
We had a doji last quarter and now we have a reversal pattern on the candles.
Rsi caved in from a high of 77 to about 40 and bounced off, which is very interesting to note. It seems to suggest that it is only a pullback in a healthy bull run.
Momentum indicators are mostly supportive.
Monthly
A few correlated oddly-shaped W's on price and momentum indicators.
You can easily draw the downstream moo river on rsi by linking up tops of M's and bottoms of W's, it is such a well formed river, that you do wonder who has been charting it all along. As you can see, we are not out of the downstream moo river yet, facing an immediate upperbank resistance near 52ish, a breach of which will be significant.
But price has already broken its down stream moo river and has so far this month stayed above the breached former upperbank for support, which is encouraging. You can draw a tentative upstream moo river at +45 degrees and it gives us an upperbank touch in the near term at 1490ish.
Weekly
This is all bullsland, with everything pointing upwards.
Price: we broke a basing diamond and are now in a second diamond with an upperside wall resistance near 1580. Somehow, in our haste to get out of the old diamond, we have left a gap 1082 and 1095, which has not been filled.
Rsi: the bullish momentum started with the small W in October 2008 and we have done through one flattish basing upstream moo river and have now risen to a much sharper upstream moo river. I think we are headed into 70's, despite current resistance.
All momentum indicators are supportive.
=========
Updated 17th May 2009:
Daily
While the correlated moo rivers on price and momentum indicators are upwards, we did hit 75 on rsi, which is quite a toppish figure. While price might still move a bit further higher, the momentum indicators are wanting a pullback to be healthy, for example, RSI could have a touchdown at the lowerbank of this upstream moo river at 49.7, which will in turn bring the price down to fill in that gap between 1082 and 1095 pence. A challenge of 1000 pence psychological support is not a bad idea.
I have drawn an upstream moo river on price: you link up candle tops on 7th Jan and 7th May, which serves as our upperbank in the upstream moo river; then you use parallel lines to form three lowerbanks for support, lowerbank 1 links up candle bottom on 19th December; lowerbank 2 links up candle bottom on 21st Jan; and lowerbank 3 links up candle bottom on 3rd Mar.
When price hit the upperbank in an upstream moo river, it tends to meander across to hit one of the lowerbanks to find further support, though it is always possible to touch the upperbank one or more times to find out whether that is indeed the limit for this run.
While the maximum drop from the upperbank to lowerbank 3 is from 1337 pence top to 760 pence bottom, in an upstream moo river, it does not tend to behave like that. so I am seeing 1000 pence as a good support or alternatively 888 pence should hold any pullbacks.
You can certainly draw the upstream moo rivers on rsi, macd, momentum and repulse indicators.
Hourly
RSI dropped out of the upstream moo river and a few indicators are bearishly poised. On Monday, the possibilities are:
1. a good opening higher will shape up a W on rsi and Momentum, giving us another rise towards 1350 pence top;
2. a poor opening eliminates the potential shaping of the W's, which will bring the price down to challenge 1100 pence and finally 1000 pence, the psychological support area.
All eyes will be on Hong Kong and China and the rest of the Asia on Monday.
==========================================
HSBC
Yearly
The downturn on this share actually stared in 2006, when we had a yearly doji candle and a reversal started then, not noticed by many.
Since then, we have had three red para sar dots with price more than halved from its 2006 top 1028 pence a share. The downtrend has been relentless with lower highs and lower lows for the past three years, including this year. If we can not breach 938 pence a share, we are still very much stuck in this ginormous downtrend.
Quarterly
It is pleasing to the bulls that we have not made a lower low here so far and has managed to hug back to the bollinger lowerbank for a lifeline, though momentum indicators are still weak.
Monthly
There are no significant bullish signals like correlated W's on price or momentum indicators.
You can draw that downstream moo river on rsi, which is quite an obvious one and we have bounced up from lowerbank 1 towards upperbank and we have not finished the job yet. So it is a downstream moo river with one upperbank and two lowerbanks, though lowerbank 2 is not too low or too close to zero to be a valid bank any more.
Momentum indicators are trying to bounce up and there is a W bounce on elder ray, which is useful.
Weekly
This has been the bullpark for the past 9 weeks as price almost doubled up from its March low. The upper bollingerband is near 664 pence a share.
But we do have some resistances at the moment. RSI is hitting the last upperbank in the downstream moo rivers, but fortunately it is only 49.5, so still some room to manoevour.
MACD is bullishly crossed and every other indicator is still supportive. There are no M's or correlated M's in sight, so bulls can breathe and enjoy their bull run by buying on dips and dives for a while yet.
Much should come as guidance from the monthly rsi downstream moo river, watch that one closely.
========
Updated on 17th May.
Daily
On the price chart, you can draw a similar upstream moo river as of Standard Chartered, this time, with two upperbanks and one lowerbank. We hit upperbank 1 at 583 on 8th May and the upperbank 2 is a higher one and lowerbank for Monday is near 488 pence and there is also a historical support near 437 (from a breached triangle upperbank from 3rd October 2008).
You can draw similar upstream moo rivers on momentum indicators as well and it is quite clear that they all had a first rejection by an upperbank last week, which seems to suggest either another challenge of the upper limit at the upperbanks or pulling back further to find key support somewhere.
I reckon on the price, there is an unfilled gap as well between 489 and 496 pence.
Hourly
For Monday, the possibilities are as follows:
1. a good start brings forth W's on Elder ray and Momentum Indicator, which takes price for another challenge of upperbank 1 near 608 pence;
2. a test of lowerbank in the upstream moo river on hourly near 489 pence.
The momentum indicators are all over the place, not giving out strong signals for either side, so it is more likely that the pullback on price might continue, as we tested upperbank on 8th May. A meandering crossing from upperbank to lowerbank in an upstream moo river is a healthy pullback, a breach of banks is an important signal to watch out for breakout trades.
Sunday 10 May 2009
Week 19 (10th May-16th May): Key Trigger timetables
Monday, 11th May: 9.15 am, HSBC;
Tuesday, 12th May: UK: April retail sales monitor (0001 BST), March industrial/manufacturing production (0930 BST), March trade balance (0930 BST); US: March trade balance (1330 BST), May consumer confidence (1500 BST), April Treasury budget (1900 BST);
Wednesday, 13th May: J Sainsbury (retail result);Dr Pepper Snapple Group, Macy's;
Economic indicators UK: April GDP (0001 BST), March labour market data (0930 BST), quarterly Bank of England inflation report (1030 BST); US: April import prices (1330 BST), April retail sales (1330 BST), March business inventories (1500 BST), W/e 07/05 crude oil inventories (1530 BST).
Thursday, 14th May: Wal-Mart Stores (Q1);
US 07/05 initial jobless claims (1230 BST), April PPI (1330 BST);
Friday, 15th May: EU: Q1 preliminary GDP (1000 BST), April final HICP (1000 BST); France: Q1 preliminary GDP (0745 BST); Germany: Q1 preliminary GDP (0700 BST); ; US: April CPI (1330 BST), May Empire State manufacturing survey (1330 BST), April capacity utilisation (1415 BST), April industrial production (1415 BST), May University of Michigan consumer sentiment survey (1455 BST);
=========================================================
Wednesday looks like a heavy day this week!
Tuesday, 12th May: UK: April retail sales monitor (0001 BST), March industrial/manufacturing production (0930 BST), March trade balance (0930 BST); US: March trade balance (1330 BST), May consumer confidence (1500 BST), April Treasury budget (1900 BST);
Wednesday, 13th May: J Sainsbury (retail result);Dr Pepper Snapple Group, Macy's;
Economic indicators UK: April GDP (0001 BST), March labour market data (0930 BST), quarterly Bank of England inflation report (1030 BST); US: April import prices (1330 BST), April retail sales (1330 BST), March business inventories (1500 BST), W/e 07/05 crude oil inventories (1530 BST).
Thursday, 14th May: Wal-Mart Stores (Q1);
US 07/05 initial jobless claims (1230 BST), April PPI (1330 BST);
Friday, 15th May: EU: Q1 preliminary GDP (1000 BST), April final HICP (1000 BST); France: Q1 preliminary GDP (0745 BST); Germany: Q1 preliminary GDP (0700 BST); ; US: April CPI (1330 BST), May Empire State manufacturing survey (1330 BST), April capacity utilisation (1415 BST), April industrial production (1415 BST), May University of Michigan consumer sentiment survey (1455 BST);
=========================================================
Wednesday looks like a heavy day this week!
Week 19 (10th May-16th May): FTSE100 Moo River Watch
FTSE 100
(based on 30 year advanced charts)
Yearly
The yearly rsi came down from an all time high of 91 in 1999 to 55.4 which seems to be suggesting that we are only half way through a ginormous bear market and it is currently stuck in the middle of a downstream moo river. All very bearish here, apart from the candle, which is a doji for now, but it is a long year. We are hugging the bollinger midline here.
Quarterly
The rsi has completed one full crossing from 70 to 30, so the bullishness of the old uptrend has gone and it is doubtful whether we can reach 70 again this time round. Like Japan, we are very much stuck in the downstream moo river or the great bear market and the momentum indicators are trying to bounce up.
Quarterly top target prices could be 4650 and 4830 and we seem to have seen this quarter's low already.
Monthly
I can argue that we have correlated W's on price and momentum indicators such as RSI, whose W is very well formed. This is the third green monthly candle and I think I commented on the old moo river HQ, a three green monthly candles in a row could end the bear market.
There is still quite a bit upside in the rsi downstream moo river yet.
Weekly
We are hitting tops or upperbanks here, on rsi, macd and repulse, so there is a good chance fore a pullback, while the rsi is almost 56. Watch out to see whether rsi can reach 70, which will be significant.
Price, it has sort of destroyed my diamond on the innerside, still it might just be a minor breach. A break of 4530 will completely destroy the inner wall of the diamond. The next diamond wall will be near 4730.
Daily
No bearish divergence yet, though rsi has the potential to shape up a M against 70's high value. If the market finds a good excuse, we should have early weakness to start the week.
We are in this last little square for my diamond in the upstream moo rivers. So roughly, this little square is circumscribed between 4100 and 4600, hence I am forecasting a weekly range between 4300 and 4600, with early weakness and later strength.
good luck.
Monthly
(based on 30 year advanced charts)
Yearly
The yearly rsi came down from an all time high of 91 in 1999 to 55.4 which seems to be suggesting that we are only half way through a ginormous bear market and it is currently stuck in the middle of a downstream moo river. All very bearish here, apart from the candle, which is a doji for now, but it is a long year. We are hugging the bollinger midline here.
Quarterly
The rsi has completed one full crossing from 70 to 30, so the bullishness of the old uptrend has gone and it is doubtful whether we can reach 70 again this time round. Like Japan, we are very much stuck in the downstream moo river or the great bear market and the momentum indicators are trying to bounce up.
Quarterly top target prices could be 4650 and 4830 and we seem to have seen this quarter's low already.
Monthly
I can argue that we have correlated W's on price and momentum indicators such as RSI, whose W is very well formed. This is the third green monthly candle and I think I commented on the old moo river HQ, a three green monthly candles in a row could end the bear market.
There is still quite a bit upside in the rsi downstream moo river yet.
Weekly
We are hitting tops or upperbanks here, on rsi, macd and repulse, so there is a good chance fore a pullback, while the rsi is almost 56. Watch out to see whether rsi can reach 70, which will be significant.
Price, it has sort of destroyed my diamond on the innerside, still it might just be a minor breach. A break of 4530 will completely destroy the inner wall of the diamond. The next diamond wall will be near 4730.
Daily
No bearish divergence yet, though rsi has the potential to shape up a M against 70's high value. If the market finds a good excuse, we should have early weakness to start the week.
We are in this last little square for my diamond in the upstream moo rivers. So roughly, this little square is circumscribed between 4100 and 4600, hence I am forecasting a weekly range between 4300 and 4600, with early weakness and later strength.
good luck.
Monthly
Week 19 (10th May-16th May): American Moo River Watch
Dow
(based on 30 year advanced data charts)
Yearly
This yearly rsi is taking time to get off the lowerbank of the ongoing downstream moo river. It needs to be watched.
All the other indicators are still pointing downwards, as price tangles with bollinger midline.
Quarterly
The bears are not dead and buried here. It is a mere bear market rally, as the bears love saying that for the past two years. A key challenge is coming, with pricing challenging 8800-9100 and rsi challenging 44. The momentum indicators are trying to bend up, but nothing significantly W'ish here.
Monthly
Where other indices have a beautiful W here on rsi, dow has oddly shaped W's all over the place. RSI is only 35.29, having come up through 30 the week before, which was a significant development.
Price is facing significant resistance near 9000 and rsi will be challenging 40.
Weekly
There is no stopping of the rampant bulls here, rsi is only 52 and still has room to go before it hits a ceiling near 61. All the other indicators are supportive and have further to go higher. A challenge of 9100ish is imminent.
Daily
We have finally reached 70 last week, a milestone in the change of sentiment from bearishness to bullishness, as we have been kept under 60 for a long time.
Near term, there may be some early weakness, but not much weakness there on daily rsi, perhaps to 60/61. Still, bears will be attacking that level to bring forth more of a pullback towards 40 rsi. Some vague M's there or to emerge on momentum indicators.
The coming week is a tricky one to predict. I am going for an early weakness towards 8350 and late rally towards 8850. If however, 8300 is broken, then we may get to 8050which seems to be unlikely for now.
good luck.
(based on 30 year advanced data charts)
Yearly
This yearly rsi is taking time to get off the lowerbank of the ongoing downstream moo river. It needs to be watched.
All the other indicators are still pointing downwards, as price tangles with bollinger midline.
Quarterly
The bears are not dead and buried here. It is a mere bear market rally, as the bears love saying that for the past two years. A key challenge is coming, with pricing challenging 8800-9100 and rsi challenging 44. The momentum indicators are trying to bend up, but nothing significantly W'ish here.
Monthly
Where other indices have a beautiful W here on rsi, dow has oddly shaped W's all over the place. RSI is only 35.29, having come up through 30 the week before, which was a significant development.
Price is facing significant resistance near 9000 and rsi will be challenging 40.
Weekly
There is no stopping of the rampant bulls here, rsi is only 52 and still has room to go before it hits a ceiling near 61. All the other indicators are supportive and have further to go higher. A challenge of 9100ish is imminent.
Daily
We have finally reached 70 last week, a milestone in the change of sentiment from bearishness to bullishness, as we have been kept under 60 for a long time.
Near term, there may be some early weakness, but not much weakness there on daily rsi, perhaps to 60/61. Still, bears will be attacking that level to bring forth more of a pullback towards 40 rsi. Some vague M's there or to emerge on momentum indicators.
The coming week is a tricky one to predict. I am going for an early weakness towards 8350 and late rally towards 8850. If however, 8300 is broken, then we may get to 8050which seems to be unlikely for now.
good luck.
Week 19 (10th May-16th May): Wealth Moo River Watch
cable (sterling/dollar)
(based on 30 year advanced data chart)
Yearly
We have started the year brightly as the candle is turning green now, but momentum indicators are not yet supportive of the bullish scenario.
Quarterly
No significant bullish indication on the momentum indicators yet, but the candles do present a reversal pattern there, if we can break $1.54 this quarter.
Monthly
We are rounding up the bottom on price and momentum indicators.
Price: we are facing the row of red para sar dots resistance soon near $1.60;
RSI: is yet to bounce through 30, can you imagine that, we have not started the bull run yet!
Weekly
This is the most bullish of all, as of indices, the weeklies are where the bulls party merrily.
There is no significant indication of a top yet, though Momentum Indicator might shape up a M there, potentially. Price is hitting bollinger upperband and rsi is hitting one of three upperbanks I have drawn in this upstream moo river, though rsi is only 50.8, more room to go up yet.
Daily
We are almost due for a pullback here, judging from the rsi inside its upstream moo river. A potential M might appear there. A spike and tank scenario is a distinct possibility. Between $1.55 and $1.57, there seems to be a bear camp there.
Though it apppears to be a rounded bottom, you could say it is a head and shoulder pattern as well, with $1.55 as the neckline, so a key challenge is coming up, failing there, we could potentially end up in a flat battle zone below $1.55.
I remain bullish on cable for the medium term, though I suspect a healthy pullback is coming up.
Ps I am going to use cable, Japan and FTES100 as my triple trading screens from now on as they seem to be linked to each other in some curious ways.
============================================================================
Gold (spot)
(based on 30 year advanced data charts)
Yearly
What do you think of this bull run since 2002? If you were trading gold in 2002, would you be able to ride it to the full run or got stuck shorting it half way through it? I wouldn't be on the possibility that I ride it to the full, it looks like a brilliant bull run, but it must be very difficult to trade it, because you have to be so bull-minded all the way through to buy it all the way up, on dips and dives or just buy it.
When you look at the market, you also feel a chill down your spine as it just shows how powerful a bull run could be and the opposite is true for the bear market too. Markets are irrational and go from one extreme to another, almost like the boom and bust scenario, maybe it is just because it is all part of the human venture, fear and greed, plus deliberate manipulation.
But all good parties come to an end, so when will this gold party come to its end? Though yearly rsi has reached over 83, there is no sign of a reveral yet. How scary!
Quarterly
We are having three rare red para sar dots after so many quarters since 2002. The momentum indicators are tiring or toppish, e.g., rsi having reached 89 and stayed above 70 since Q3 2005. This should teach us more about the use of rsi as well, overbought based on rsi is not to be trusted in a strong trending market.
We have this long running upstream moo river on rsi since 1999 and we have only ever had one full crossing from the lowerbank to the upperbank from Q1 2001 to Q1 2004. This teaches us yet another thing that in strong trending market, full pullbacks from bank to bank is not guaranteed. And strangely, when the next time we have a full crossing from upperbank to the lowerbank (as it is headed now), it might kill off this upstream moo river altogether.
For a rational mind, surely every institutional player with billions of our pension and isa money to play will be averaging up to sell gold to the floor, but strangely, it seems that many of them are still hoarding gold in our portfolios.
Monthly
The superbull trend actually died in July 2008, as it broke its long running upstream moo river since 1997! This seems to have gone unnoticed, with rsi breaking down through its lowerbank and all the momentum indicators collapsing, though price has been artificially maintained at a high level on bearish divergences to add doubts to many a undetermined mind.
Gold is dead for me or it is dying. The luster of gold was gone in July 2008. All that glistens at the moment may not be gold these days. It is just a topping exercise but when the downturn comes, it will be as severe as it came up.
If I won the Eurobillion, I would be selling gold! For now, I stay well away from this wild beast.
Weekly
Strangely, to the unknowing eyes and minds, the death of this superbull trend died in September 2005. Since then, it has been one superparabolic ride to antigravity as we have a downstream moo river on rsi since that time.
While the price tops, rsi is gradually exhausting itself to the downside, so there we can foresee many powerful rallies, but they are bear market rallies as gold is now headed into multi-year bear market.
Daily
At this moment, we don't know whether gold is still in the ABC pondering waves at the top, or we have started the 5 impulsive waves down already, with Mar 2008 to Oct 2008, being the first wave down, now we are in wave 2 or on the way down in Wave 3.
The big boys are repositioning behind the smoke screens and many private investors will be sucked into the glistening charm of gold at the wrong time of history. The boom is gone and the bust is yet to show itself.
I am extremely bearish on gold.
====================================
VIX (May)
This one is headed for my forecasted norm range between 40 and 10, but near term a bouncing up and down between 30 and 35 seems to be possible, as 4hour rsi is eating into 30 and trying to bounce up from there. There are a few gaps on the way down, in the 34's and 33's.
On the yahoo long term charts over the past decades, it seems that VIX has had Wave 1,2,3 and 4, and is still pending a Wave 5 top, which might take it back over 60's.
It seems that there is plenty of indication for another test of the indices low in the future and people who have missed the rally of the stock markets so far are also wishing for another stock market low to load up their investments or longs.
We will have to wait and see.
==============================================================
Nymex (June)
Oil is the symbol of economic confidence in the world and oil has bounced up nicely.
Daily rsi has just reached 70, which signals a strong bull run.
However, 4hour rsi has falled down out of the upstream moo river and is now trading on bearish divergence. So a pullback is expected, if not a reversal.
The bull run can still continue if price can hold above 54 dollars, on subsiding momentums.
I have the suspicion that oil is not going very far this year, as it is closer to the economic reality than the stock markets, it might meander up and down between 30 and 60 roughly.
=============================
Overall, the wealth moo rivers seem to be suggesting a near term pullback in the stock markets is imminent and plausible and needed.
good luck, bulls and bears, if you do trade them. I simply use them as basis for a correlated finding acrossing the moo rivers.
(based on 30 year advanced data chart)
Yearly
We have started the year brightly as the candle is turning green now, but momentum indicators are not yet supportive of the bullish scenario.
Quarterly
No significant bullish indication on the momentum indicators yet, but the candles do present a reversal pattern there, if we can break $1.54 this quarter.
Monthly
We are rounding up the bottom on price and momentum indicators.
Price: we are facing the row of red para sar dots resistance soon near $1.60;
RSI: is yet to bounce through 30, can you imagine that, we have not started the bull run yet!
Weekly
This is the most bullish of all, as of indices, the weeklies are where the bulls party merrily.
There is no significant indication of a top yet, though Momentum Indicator might shape up a M there, potentially. Price is hitting bollinger upperband and rsi is hitting one of three upperbanks I have drawn in this upstream moo river, though rsi is only 50.8, more room to go up yet.
Daily
We are almost due for a pullback here, judging from the rsi inside its upstream moo river. A potential M might appear there. A spike and tank scenario is a distinct possibility. Between $1.55 and $1.57, there seems to be a bear camp there.
Though it apppears to be a rounded bottom, you could say it is a head and shoulder pattern as well, with $1.55 as the neckline, so a key challenge is coming up, failing there, we could potentially end up in a flat battle zone below $1.55.
I remain bullish on cable for the medium term, though I suspect a healthy pullback is coming up.
Ps I am going to use cable, Japan and FTES100 as my triple trading screens from now on as they seem to be linked to each other in some curious ways.
============================================================================
Gold (spot)
(based on 30 year advanced data charts)
Yearly
What do you think of this bull run since 2002? If you were trading gold in 2002, would you be able to ride it to the full run or got stuck shorting it half way through it? I wouldn't be on the possibility that I ride it to the full, it looks like a brilliant bull run, but it must be very difficult to trade it, because you have to be so bull-minded all the way through to buy it all the way up, on dips and dives or just buy it.
When you look at the market, you also feel a chill down your spine as it just shows how powerful a bull run could be and the opposite is true for the bear market too. Markets are irrational and go from one extreme to another, almost like the boom and bust scenario, maybe it is just because it is all part of the human venture, fear and greed, plus deliberate manipulation.
But all good parties come to an end, so when will this gold party come to its end? Though yearly rsi has reached over 83, there is no sign of a reveral yet. How scary!
Quarterly
We are having three rare red para sar dots after so many quarters since 2002. The momentum indicators are tiring or toppish, e.g., rsi having reached 89 and stayed above 70 since Q3 2005. This should teach us more about the use of rsi as well, overbought based on rsi is not to be trusted in a strong trending market.
We have this long running upstream moo river on rsi since 1999 and we have only ever had one full crossing from the lowerbank to the upperbank from Q1 2001 to Q1 2004. This teaches us yet another thing that in strong trending market, full pullbacks from bank to bank is not guaranteed. And strangely, when the next time we have a full crossing from upperbank to the lowerbank (as it is headed now), it might kill off this upstream moo river altogether.
For a rational mind, surely every institutional player with billions of our pension and isa money to play will be averaging up to sell gold to the floor, but strangely, it seems that many of them are still hoarding gold in our portfolios.
Monthly
The superbull trend actually died in July 2008, as it broke its long running upstream moo river since 1997! This seems to have gone unnoticed, with rsi breaking down through its lowerbank and all the momentum indicators collapsing, though price has been artificially maintained at a high level on bearish divergences to add doubts to many a undetermined mind.
Gold is dead for me or it is dying. The luster of gold was gone in July 2008. All that glistens at the moment may not be gold these days. It is just a topping exercise but when the downturn comes, it will be as severe as it came up.
If I won the Eurobillion, I would be selling gold! For now, I stay well away from this wild beast.
Weekly
Strangely, to the unknowing eyes and minds, the death of this superbull trend died in September 2005. Since then, it has been one superparabolic ride to antigravity as we have a downstream moo river on rsi since that time.
While the price tops, rsi is gradually exhausting itself to the downside, so there we can foresee many powerful rallies, but they are bear market rallies as gold is now headed into multi-year bear market.
Daily
At this moment, we don't know whether gold is still in the ABC pondering waves at the top, or we have started the 5 impulsive waves down already, with Mar 2008 to Oct 2008, being the first wave down, now we are in wave 2 or on the way down in Wave 3.
The big boys are repositioning behind the smoke screens and many private investors will be sucked into the glistening charm of gold at the wrong time of history. The boom is gone and the bust is yet to show itself.
I am extremely bearish on gold.
====================================
VIX (May)
This one is headed for my forecasted norm range between 40 and 10, but near term a bouncing up and down between 30 and 35 seems to be possible, as 4hour rsi is eating into 30 and trying to bounce up from there. There are a few gaps on the way down, in the 34's and 33's.
On the yahoo long term charts over the past decades, it seems that VIX has had Wave 1,2,3 and 4, and is still pending a Wave 5 top, which might take it back over 60's.
It seems that there is plenty of indication for another test of the indices low in the future and people who have missed the rally of the stock markets so far are also wishing for another stock market low to load up their investments or longs.
We will have to wait and see.
==============================================================
Nymex (June)
Oil is the symbol of economic confidence in the world and oil has bounced up nicely.
Daily rsi has just reached 70, which signals a strong bull run.
However, 4hour rsi has falled down out of the upstream moo river and is now trading on bearish divergence. So a pullback is expected, if not a reversal.
The bull run can still continue if price can hold above 54 dollars, on subsiding momentums.
I have the suspicion that oil is not going very far this year, as it is closer to the economic reality than the stock markets, it might meander up and down between 30 and 60 roughly.
=============================
Overall, the wealth moo rivers seem to be suggesting a near term pullback in the stock markets is imminent and plausible and needed.
good luck, bulls and bears, if you do trade them. I simply use them as basis for a correlated finding acrossing the moo rivers.
Saturday 9 May 2009
Week 19 (10th May-16th May): Asian Moo River Watch
Hong Kong (HS42)
Yearly
How does a para sar dot change colour and this one is still red so far.
Quarterly
We have penetrated the downstream moo river on price chart here and it has been a solid break, but somehow without breaking 17600, we are still stuck in the possibility of a flat battle zone between bulls and bears. A row of red para sar dots are hanging heavily upon the price chart. Can the bulls manage to break this key resistance, a symbolic level almost.
We have still got 1.5 months left in this quarter, on a close above 16300 will signal the end of the bear market for Hong Kong.
Monthly
This is where the momentum indicators come into play and all of them are bending upwards, no obvious W there, which leaves the possibility of a flat battle zone. We have already left that downstream moo river in April and this month we have consolidated well clear of the former upperbank. Bollinger midline is near 20395. I just wonder whether that magic number 20700 will play a part here in this battle. We are getting closer to challenge the red row of para sar dots, who are like Man Utd defenders like Rio et al, most hated in the premiership, but secretly you do want them to be in your team.
Weekly
This is the most bullish place on earth.
Price chart had a reversal candle, which refuted the pullback to go straight up last wee. It has now broken through my upstream moo river, upon the sixth green para sar dots.
Weekly rsi has almost broken the upstream moo river to the upside as well, valued at 61.4, which seems to offer more room for the upside, though the shape of the rsi does leave the potential for a powerful M to bring forth a useful pullback at at least. For the bears, it will be satisfactory if we do not break 17600 this week and just repeat last week's range for another week, 15454 and 17594. On the price chart, price has gone too far to shape up an immediate M reversal, so it might require at least a double top there.
All momentum indicators are bullish, and repulse has broken the upperbank of the upstream moo river as well. This is a very strong bull run indeed.
If we do break clean of 17600, we will reach 20700 in absolutely no time at all and I am not sure whether we will stop there, as I am yet to draw any key resistance lines there, though there may be a minor resistance there just under 18500.
A break of 17600 will be very significant for bulls and bears, as it will break the intertwining downstream moo rivers from 2007 and we could safely say that is the END OF THE BEAR MARKET!
A false dawn near 17900 and it comes straight back into the downstream moo river will further complicate the picture, e.g., are we in a new upstream moo river now or are we back into the old downstream moo river, which means the bear market continues intact despite the recent rally.
I think we all should watch Hong Kong very closely for further clues about what lies ahead of the global markets.
Daily
If we twist the Elliott Wave Theory a bit, we might count out five waves up on price chart already, so we are in this final wave, which seems to have a few more days at the top yet.
All momentum indicators are bullish, though rsi is hitting 73.22 there, still some headroom left in the upstream moo river and the other indicators are not entirely over the top yet, signalling some residue bullish momentum at least.
Significantly, there are no M's anywhere in sight. Watch out for them, if you are a determined bear.
===========================================================================
Japan (Nikkei 225)
(based on 30 year advanced charts)
Yearly
Japan is lagging behind Hong Kong so much and we have not moved much at all this year. I think it is reluctance of the Japanese to follow the Chinese, which is the cause of it--Japan is hurting in its pride! They'd rather be doom and gloom and uniquely Japanese rather than boom and boon like the Chinese.
Quarterly
We are still well stuck in the downstream moo rivers on price and momentum indicators, as if the Japanese are refusing to join in this rally, though rsi does bounce up against the lowerbank there, but not much. It looks like at any moment the Japanese might drop on their weak knees and sulk in their eternal bear market blues. But Japan is world's No.2 economy, how strange that is!
Monthly
This is where we see a beautifully shaped W on rsi against the lowerbank of the downstream moo river, and it bears similariities around the world, which is why it is a global rally, where Japan has no choice but to be pulled up and out of the doom and gloom. But we are still in bear market territory, and there is no need to ask whether the bear market has finished or not yet!
Weekly
This is where even the Japanese get a bit bullish, with all indicators pointing up an noticeably rsi has the potential to shape up a M against the upperbank of the upstream moo river, though rsi is only 56.6.
I can see a butterfly pattern on price chart as well and last week has just confirmed that it is possible that this butterfly's right wing might be formed over the coming weeks if not months, patiently and meticulously.
In a way, Nikkei 225 is very similar to FTSE100, both having a butterfly pattern there to be unravelled and Japan is slightly leading the UK in that sense. Without Japan hitting 10000, there is really no point of talking about a pullback there.
Still 9750 might be a significant lifeline for bears, as this is the former weekly superhammer lifeline, a rejection there will be fatal for some bulls.
Very soon, Japan need to make a key decision about it fate, a break of 10000, will take the Japanese out of the doom and gloom very quickly and a rejection there will add further pessimism. The whole world over will be watching Japan's 10000!
And you can say we are stuck in this tightest of all triangles between 10k and 8900 in the coming week and there are only 2-3 weeks left, when the triangle must be broken one way or another.
Daily
With such a rarity of M's these days, we have to take note of the potential M on the daily momentum indicators and an early fall on Monday will shape up that M all over the place. Are Japan going to shy away from 10000?
We will wait and see.
Good luck, bulls and bears. Asia is the one to be watched closely, even if you do not trade it with HS42=dow and Jap225=ftse100, in terms of their similiarity and momentums.
Yearly
How does a para sar dot change colour and this one is still red so far.
Quarterly
We have penetrated the downstream moo river on price chart here and it has been a solid break, but somehow without breaking 17600, we are still stuck in the possibility of a flat battle zone between bulls and bears. A row of red para sar dots are hanging heavily upon the price chart. Can the bulls manage to break this key resistance, a symbolic level almost.
We have still got 1.5 months left in this quarter, on a close above 16300 will signal the end of the bear market for Hong Kong.
Monthly
This is where the momentum indicators come into play and all of them are bending upwards, no obvious W there, which leaves the possibility of a flat battle zone. We have already left that downstream moo river in April and this month we have consolidated well clear of the former upperbank. Bollinger midline is near 20395. I just wonder whether that magic number 20700 will play a part here in this battle. We are getting closer to challenge the red row of para sar dots, who are like Man Utd defenders like Rio et al, most hated in the premiership, but secretly you do want them to be in your team.
Weekly
This is the most bullish place on earth.
Price chart had a reversal candle, which refuted the pullback to go straight up last wee. It has now broken through my upstream moo river, upon the sixth green para sar dots.
Weekly rsi has almost broken the upstream moo river to the upside as well, valued at 61.4, which seems to offer more room for the upside, though the shape of the rsi does leave the potential for a powerful M to bring forth a useful pullback at at least. For the bears, it will be satisfactory if we do not break 17600 this week and just repeat last week's range for another week, 15454 and 17594. On the price chart, price has gone too far to shape up an immediate M reversal, so it might require at least a double top there.
All momentum indicators are bullish, and repulse has broken the upperbank of the upstream moo river as well. This is a very strong bull run indeed.
If we do break clean of 17600, we will reach 20700 in absolutely no time at all and I am not sure whether we will stop there, as I am yet to draw any key resistance lines there, though there may be a minor resistance there just under 18500.
A break of 17600 will be very significant for bulls and bears, as it will break the intertwining downstream moo rivers from 2007 and we could safely say that is the END OF THE BEAR MARKET!
A false dawn near 17900 and it comes straight back into the downstream moo river will further complicate the picture, e.g., are we in a new upstream moo river now or are we back into the old downstream moo river, which means the bear market continues intact despite the recent rally.
I think we all should watch Hong Kong very closely for further clues about what lies ahead of the global markets.
Daily
If we twist the Elliott Wave Theory a bit, we might count out five waves up on price chart already, so we are in this final wave, which seems to have a few more days at the top yet.
All momentum indicators are bullish, though rsi is hitting 73.22 there, still some headroom left in the upstream moo river and the other indicators are not entirely over the top yet, signalling some residue bullish momentum at least.
Significantly, there are no M's anywhere in sight. Watch out for them, if you are a determined bear.
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Japan (Nikkei 225)
(based on 30 year advanced charts)
Yearly
Japan is lagging behind Hong Kong so much and we have not moved much at all this year. I think it is reluctance of the Japanese to follow the Chinese, which is the cause of it--Japan is hurting in its pride! They'd rather be doom and gloom and uniquely Japanese rather than boom and boon like the Chinese.
Quarterly
We are still well stuck in the downstream moo rivers on price and momentum indicators, as if the Japanese are refusing to join in this rally, though rsi does bounce up against the lowerbank there, but not much. It looks like at any moment the Japanese might drop on their weak knees and sulk in their eternal bear market blues. But Japan is world's No.2 economy, how strange that is!
Monthly
This is where we see a beautifully shaped W on rsi against the lowerbank of the downstream moo river, and it bears similariities around the world, which is why it is a global rally, where Japan has no choice but to be pulled up and out of the doom and gloom. But we are still in bear market territory, and there is no need to ask whether the bear market has finished or not yet!
Weekly
This is where even the Japanese get a bit bullish, with all indicators pointing up an noticeably rsi has the potential to shape up a M against the upperbank of the upstream moo river, though rsi is only 56.6.
I can see a butterfly pattern on price chart as well and last week has just confirmed that it is possible that this butterfly's right wing might be formed over the coming weeks if not months, patiently and meticulously.
In a way, Nikkei 225 is very similar to FTSE100, both having a butterfly pattern there to be unravelled and Japan is slightly leading the UK in that sense. Without Japan hitting 10000, there is really no point of talking about a pullback there.
Still 9750 might be a significant lifeline for bears, as this is the former weekly superhammer lifeline, a rejection there will be fatal for some bulls.
Very soon, Japan need to make a key decision about it fate, a break of 10000, will take the Japanese out of the doom and gloom very quickly and a rejection there will add further pessimism. The whole world over will be watching Japan's 10000!
And you can say we are stuck in this tightest of all triangles between 10k and 8900 in the coming week and there are only 2-3 weeks left, when the triangle must be broken one way or another.
Daily
With such a rarity of M's these days, we have to take note of the potential M on the daily momentum indicators and an early fall on Monday will shape up that M all over the place. Are Japan going to shy away from 10000?
We will wait and see.
Good luck, bulls and bears. Asia is the one to be watched closely, even if you do not trade it with HS42=dow and Jap225=ftse100, in terms of their similiarity and momentums.
The Butterfly Flight of 2009
Since we have got to 4300 (my original target for the stimulus/budget rally), I have been struggling with trading on the short side. Somehow, I have set in mind that no buying over 4300, which has been costing me dearly last week.
I have had a good look at the weekly price chart and have decided to change my strategy to one of buying on dips and dives in this what I now call the Butterfly Flight of 2009, till August 2009, Week 34 to be more precise. I think the next bear leg will come around that time, or at least around that time, the market and the economy will be at a turning point,either big up or big down.
So if you are a permabear, you might as well go hybernating now till August, when it is time for you to come out in the autumn sunshine and festivity.
If you are a permabull, this is as good a time as it gets. While you might kick yourself for missing the early part of the rally, but you have only missed half of the rally, there is still another 500 points or so to come yet.
Trading will not be easy, as it will be an antigravity ride all the way up into 5000's. You will be fighting your fear all the way up.
Obviously, this is just one scenario that might pan out into the future and there will be other possibilities.
Here is my trading plan till August 2009:
1. Be stubborn and buy on dips and dives until the butterfly has been broken;
2. Once the butterfly is broken, reassess and formulate a new trading plan.
I have made up my mind based on drawing a butterfly on the weekly chart, which could easily be a flight of fantasy, but I am sticking to it for now.
PS I will be updating the moo river watch as usual over this weekend.
I have had a good look at the weekly price chart and have decided to change my strategy to one of buying on dips and dives in this what I now call the Butterfly Flight of 2009, till August 2009, Week 34 to be more precise. I think the next bear leg will come around that time, or at least around that time, the market and the economy will be at a turning point,either big up or big down.
So if you are a permabear, you might as well go hybernating now till August, when it is time for you to come out in the autumn sunshine and festivity.
If you are a permabull, this is as good a time as it gets. While you might kick yourself for missing the early part of the rally, but you have only missed half of the rally, there is still another 500 points or so to come yet.
Trading will not be easy, as it will be an antigravity ride all the way up into 5000's. You will be fighting your fear all the way up.
Obviously, this is just one scenario that might pan out into the future and there will be other possibilities.
Here is my trading plan till August 2009:
1. Be stubborn and buy on dips and dives until the butterfly has been broken;
2. Once the butterfly is broken, reassess and formulate a new trading plan.
I have made up my mind based on drawing a butterfly on the weekly chart, which could easily be a flight of fantasy, but I am sticking to it for now.
PS I will be updating the moo river watch as usual over this weekend.
Thursday 7 May 2009
Reversal Butterfly on ftse100
I have learnt something new yesterday about the butterfly reversal pattern from this site: http://images.google.co.uk/imgres?imgurl=http://tradinglib.com/wp-content/uploads/2007/07/bf8.gif&imgrefurl=http://tradinglib.com/trading-strategies/an-introduction-to-trading-gartley-and-butterfly-reversals&usg=__Cp14frReUhCQt4KHeyhmx5cFPms=&h=358&w=351&sz=36&hl=en&start=14&um=1&tbnid=z2hnJnHr47k7HM:&tbnh=121&tbnw=119&prev=/images?q%3Dbutterfly%2Bpattern%2BAB%253DCD%26hl%3Den%26sa%3DN%26um%3D1
While the market seems to be going against me these days, I have opted to learn about drawing butterflies instead. Here is one I have drawn on weekly price chart on ftse100.
While the market seems to be going against me these days, I have opted to learn about drawing butterflies instead. Here is one I have drawn on weekly price chart on ftse100.
Sunday 3 May 2009
Week 18 (3rd May-9th May): FTSE100 Moo River Watch
FTSE100
30 year data charts
Yearly
This is the scary bit, as there is the first red para sar dot, after three green para sar dots for the past three years, but yearly ranges are difficult to be useful for day to day trading, as last year's green para sar dot was no use to bulls at all.
Still, we are struggling with the bollinger midline near 4564, which is why this year 4600ish zone is a key ceiling for ftse100.
Quarterly
We are tangling with the lower bollinger band for the past three quarters. Momentum indicators are still not that bullish. This quarter's maximum range could be between 3570 and 4700, though I suspect we have already seen the quarter low for now, which was 3836 and we are yet to find out the quarterly high, in the 4400-4700 zone.
Monthly
We are meandering to cross from the lowerbank to the upperbank in a ginormous downstream moo river. While a vertical crossing will take us up to 5100, but it shouldn't happen in a downstream moo river, as vertical crossing in a downstream moo river only happens downwards, usually.
The maximum monthly range could be between 4740 and 3660, I suspect we will be able to stay above 4000 all quarter now to confuse many a bear.
One noticeable feature on monthly is that a few momentum indicators have escaped the clasp of downstream moo rivers, which is a significant development.
The key debate these days is whether the bear market has ended in March or whether this is yet another bear market rally. In terms of price, ftse100 is lagging many other indices in the world, something is brewing there.
The problem for bears in a more sustained rally is that the indices around the world take turns to take up the leadership, as Japan did in the absence of Hong Kong and FTSE in moments of weakness or uncertainty for Dow.
Weekly
We have had a W on Momentum indicator itself and everything is bullish here as with other indices, but significantly, we have only had two green para sar dots, so there is plenty of bullish momentum left yet.
We have talked about the Battle of the Diamond on weekly price chart. Weekly rsi has broken a long running dowstream moo river last week, a touch of 55ish will falsify that downstream moo river altogether. However, several other indicators are almost hitting upperbanks in upstream moo rivers, signaling a near term ceiling is not too far away.
As for the weekly range, there are two distinctive possibilities:
1. bullish: we gap up to dash towards 4440ish weekly top in fairly quick successions, surpring many a doubtful bears and then after reaching that target, the only way is downwards towards 4000, major support. There, the weekly range could be 4440 and 4100;
2. bearish: we gap down tonight and stay under that gap for the rest week in a tight range of 4210 and 4050.
So it all depends on Asia tonight.
Daily
A look at the momentum indicators gives me more confidence for the bullish scenario, though you might want to wait after tonight's Asian trading to make up your minds.
=======================
Trading strategy: no shorts until we have seen 4400 minimum; once we have seen 4400, turn into an aggressive bear immediately.
30 year data charts
Yearly
This is the scary bit, as there is the first red para sar dot, after three green para sar dots for the past three years, but yearly ranges are difficult to be useful for day to day trading, as last year's green para sar dot was no use to bulls at all.
Still, we are struggling with the bollinger midline near 4564, which is why this year 4600ish zone is a key ceiling for ftse100.
Quarterly
We are tangling with the lower bollinger band for the past three quarters. Momentum indicators are still not that bullish. This quarter's maximum range could be between 3570 and 4700, though I suspect we have already seen the quarter low for now, which was 3836 and we are yet to find out the quarterly high, in the 4400-4700 zone.
Monthly
We are meandering to cross from the lowerbank to the upperbank in a ginormous downstream moo river. While a vertical crossing will take us up to 5100, but it shouldn't happen in a downstream moo river, as vertical crossing in a downstream moo river only happens downwards, usually.
The maximum monthly range could be between 4740 and 3660, I suspect we will be able to stay above 4000 all quarter now to confuse many a bear.
One noticeable feature on monthly is that a few momentum indicators have escaped the clasp of downstream moo rivers, which is a significant development.
The key debate these days is whether the bear market has ended in March or whether this is yet another bear market rally. In terms of price, ftse100 is lagging many other indices in the world, something is brewing there.
The problem for bears in a more sustained rally is that the indices around the world take turns to take up the leadership, as Japan did in the absence of Hong Kong and FTSE in moments of weakness or uncertainty for Dow.
Weekly
We have had a W on Momentum indicator itself and everything is bullish here as with other indices, but significantly, we have only had two green para sar dots, so there is plenty of bullish momentum left yet.
We have talked about the Battle of the Diamond on weekly price chart. Weekly rsi has broken a long running dowstream moo river last week, a touch of 55ish will falsify that downstream moo river altogether. However, several other indicators are almost hitting upperbanks in upstream moo rivers, signaling a near term ceiling is not too far away.
As for the weekly range, there are two distinctive possibilities:
1. bullish: we gap up to dash towards 4440ish weekly top in fairly quick successions, surpring many a doubtful bears and then after reaching that target, the only way is downwards towards 4000, major support. There, the weekly range could be 4440 and 4100;
2. bearish: we gap down tonight and stay under that gap for the rest week in a tight range of 4210 and 4050.
So it all depends on Asia tonight.
Daily
A look at the momentum indicators gives me more confidence for the bullish scenario, though you might want to wait after tonight's Asian trading to make up your minds.
=======================
Trading strategy: no shorts until we have seen 4400 minimum; once we have seen 4400, turn into an aggressive bear immediately.
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