Tuesday, November 25, 2014

EURUSD Bullish 8 Hour Chart

If you have been following, I have been looking for a cycle high for the dollar. I was not sure if we would get one more low in the dollar forex pairs (e.g., EURUSD) or not off the November 10 post. November 10, Dollar Weakness Post.  We now have a double bottom in EURUSD on the 8 hour chart.  I am bullish with this pivot low as the stop on that position.

Here is the chart:


Here is the weekly chart. There is lower trend line support in the 1.22 area. However, as we overthrew the triangle on one of the top waves, it is very possible we "under throw" it here by not quite touching it for the reversal. This is a long term play, so it may take a few stabs at it if I have this one wrong. Weekly chart:




There is always a bull path and a bear path. We cannot know which path our future will choose. As always, do your own due diligence, read the Disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester

Monday, November 24, 2014

Thanksgiving Week In Equities

November 25 UpdateThis will be my last post this holiday week. The rolling corrective structure continues to come in as anticipated in equities. I am still looking for that December 25-27 cycle low for the bullish dip buy area. 

I ran a few analogs through the indicators and this would be my best guesses presently. It is still just roughly the same as I laid out on November 17 (see discussion and link below):





As I stated in the past posts, I am not keen on guessing corrective structure (it could be rolling upwards, sideways, or sharp down). For me here it is all about seeing where we are at for the dip buy at the RLS cycle lows (on right of page) and watching the RLS trend indicator (on right of page).

Now, I have been watching a bearish scenario, that involves some big divergence that currently exists in the same manner it existed in October 2007. Could the stock market top here? Here is the current chart and you can see the divergence:




As indicated, the extrapolated top for this wave under the bearish scenarios (the bullish do not top here, obviously) based upon analogs occurs between November 18 and December 10 (roughly):




If this turns out to be the bearish cycle high, the market would likely trade back down to the October lows by the RLS February 5-7, 2015 longer term cycle low.

So, anyway, there is always a bear path and a bull path. That is why after the easy money was made off the October low, that I have been cautiously watching to see how this correction comes in. When I say easy money, I am talking about impulsive runs from the bottom of the chart to the top of the chart. I am not interested in guessing at corrective structure after that point and would rather just wait for the next opportunity. This would be an example of a chart that shows that the easy money has been made (see blue boxes):



So, when at least one other blog of which I am aware was turning bearish the week of October 15, I was staying bull and flipped bullish long, intermediate, and short term. Week of October 15--Hammered it bullish on all time frames. Those are the moves that I want to play as once it starts moving there really is only one direction it can go. The top of the chart--where we are now--does not interest me as that is where the dumb money and those who missed the ramp tend to play long. This does not mean it cannot go up, you can see that clearly on the chart above, it just means there are lots and lots of different scenarios and it is no longer easy money.


Have a great Thanksgiving week!



*******

Original Post: The RLS Trend Indicator (on right) has not flashed a caution sign yet for the intermediate term. I am playing for a cycle reset into either the RLS November or December potential cycle lows (on right). These counter trend plays are not any large thesis. Just a play back to support. A trend change would be required for me to get involved in any significant manner. 


As I mentioned earlier, I suspect (but don't know) that the November 25-27 cylce date may come in a little late at the December 1-2 time frame given the holiday week this week. This is a smaller cycle, so I am more looking at to see where we are at when it occurs.

I tend to believe the cycle low will come in on the December date. I am uncertain, however. What occurred in October was that we had the smaller cycle hit in mid to late September when we got the initial pop, then the larger October 15 cycle low dragged it down. So, if that was a cycle reset, the December date should be the better date. This does not really matter as the way I use cycle lows is to see where we are at when they occur. That allows me to know the likely strength of the cycle move off the low. October was a large cycle wave, and it delivered the anticipated face ripping rally. I want to trade impulses not corrections. So far, the market has just done the rolling bullish correction which was not unanticipated.

Here was the rolling bullish correction scenario I laid out on November 17:



Once we hit the area of the upper price target, I was willing to speculate on a counter trend short play. Below is the current chart, which has the 21 EMA support area in blue, and the cloud baseline support area in cyan. Those are the areas of interest for me from a price standpoint. Chart:


There is always a chance this could mark a larger cycle top. I discussed this recently in Could the stock market top here? and Stalking the Yen Reversal. However, I would need to see lots of things happen to confirm that is the case. As I always say, there is always a bull path and a bear path. I stay bull here, as I did at the October 15 cycle low, until the market says it is something other than bull.

There is always a bull path and a bear path. We cannot know which path our future will choose. As always, do your own due diligence, read the Disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester





AUDCAD 8 HOUR CHART--REDUX

November 25th Update: My position in NZDCAD was stopped out overnight. The weekly chart is still holding. I have entries orders ready of we reverse off the green support line on the weekly chart. Though the play is binary, I still like the long term support here because if it holds it will run a long time in my direction. Chart:


End of Day Update: As I do not traditionally follow NZDCAD, I spent some time looking at the weekly and monthly support. My original analysis was correct. This is the long term area where one would expect the bullishness to resume. This is binary, as it could finally break down, but until it does, this is the long term area.

The weekly chart shows a moving average cross. The goal would be to break that cyan baseline and lock in the weekly low. Chart:



The Monthly chart shows us at the area of the key monthly baseline support, which has held three times previously. Chart:



So, though the possibilites here are binary, I am staying with the long term NZDCAD bullish scenario here off the key support area.

Afternoon Update: I do not usually follow NZDCAD, but under the same analysis as the AUDCAD below, I have moved the trade to bullish NZDCAD. I like this chart a lot and the fact that its monthly chart is still on buy despite the deep sell. This could be a really good long  term trade.

Chart:



This is right where I would want to enter the trade on the NZDCAD chart, so I am going with this play here for CAD weakness. The key long term is to take and hold that green moving average around 90 right now. If it does that, then I will be looking to add into the position.


******
Orignal post. I am playing another bullish 8 hour chart on AUDCAD. Hopefully the move is slow enough that I won't sleep through the exit this time. Prior 8 Hour AUDCAD Setup.

Here is the chart:


There is always a bull path and a bear path. We cannot know which path our future will choose. As always, do your own due diligence, read the Disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester

Friday, November 21, 2014

5 Minute USDJPY Chart

I am scalping a short here on USDJPY just to see what is up. I am using the 5 minute chart:


This is right at bullish continuation support, which is where I swing trade it long for trend trades. That makes this pretty sketchy, so I am using the 5 minute chart just to see what is up. Here is the 8 hour bullish trend continuation support chart:



If the bull trend is alive and well here, it should rally off this support. I am scalping here just to see if we get a breakdown given the equity resistance area that was gapped into this morning. This trade should stop out if the bull trend lives. As it is a short term trade, I will not update this post.

There is always a bull path and a bear path. We cannot know which path our future will choose. As always, do your own due diligence, read the Disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester

Equity Update

Today's gap up was within the various scencarios and at the resistance area. My discipline was to hold the countertrend short into a daily cycle reset and we do not have that yet. Here are the recent posts: Countertrend Short and Update.

The cycle low date is November 25-27 (see potential cycle lows to the right). These often come +2 days (like it did at the August low). That would put it at November 29. With the Thanksgiving holiday, I am anticipating (though have no idea) that the cycle low might come in a bit late around December 1-2. Target wise, I am still conservatively looking for the 21 EMA area. In a more bearish scenario, we would be around SPY 192 by the cycle low. I am staying conversative, of course, because the intermediate trend indicator is still bullish.

I added another countertrend short here. As explained, this is countertrend into the various scenarios and not a bearish thesis trade. Countertrend can be hit or miss (depends how the correction comes in-deep, sideways, or upwards).  It is countertrend because the intermediate trend is still bullish (see indicator to the right). 

Chart:


There is always a bull path and a bear path. We cannot know which path our future will choose. As always, do your own due diligence, read the Disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester