9 August
ARE YOU PREPARED FOR THE NEXT LEG DOWN?
Take a look at our ElliottWave count for the markets
» VIDEO ElliottWave on the Dow Jones & ASX200
Get some control with a strategy that has produced positive results.
Here's our latest graph of results covering March to August this year.
(Past results are no guarantee of future results).
We also include a couple of charts (CBA and WOW) showing where we entered trades recently using this strategy.
FOREX: USDCHF extended its losses in the past week as expected and reached new all-time lows just above 161.8% Fibonacci extension target for wave 3. Not sure if wave 3 is done or not, but long-term speaking we remain very bearish on that pair, and any bounce from the lows will be only temporary and corrective, likely a black wave 4 before now sell-off...see charts and commentary below.
Why not get on board for some clearer way through the charts. 30 days to trial trades, analysis and education.
We're here to help so please contact us, Pete.
PS. Call anytime: 0434 288 367 or 02 4448 6020.
................................................................................................................................................................................
01 ASX + Robo for more controlled trading
CBA DAILY Chart
9 August 2011
SHORT 49.47
This CBA is comes from our mechanical trading method called Robo. This method gets you on the right side of the market at the right time, the outstanding results for this system over the last for months will be updated monthly on the website.
WOW Monthly Chart
9 August 2011
SHORT 27.37
Our longer term target for WOW is 20.00 (Major TradingLevel TL2)
Stops for end of day trading and weekly are in our Members area.
02 Today's EarlyBird Report – 10 August
Market Drivers
Dow Jones Index +3.98% 11,239
US Dollar Index -1.92% 73.92
US August Gold (Globex) 1750
WTI Oil (Globex) 78.40
Copper (Globex) 391
US BHP +10.25% 79.25
Base Metals: Steady
AUDUSD 1.02
EURUSD 1.475
S&P500 CFDs 1,126
FTSE 100 CFDs 5253
SPI Futures CFDs 4106
ASX200 3986
US News -U.S. stocks soared in turbulent trading Tuesday, coming off the worst three-day selloff since the financial crisis, as investors took in stride the Federal Reserve's pledge to keep interest rates near zero at least through mid-2013.
The Dow Jones Industrial Average finished near session highs, up 429.92 points, or 3.98%, at 11293.77. The index, which had gained as much as 243 points at its morning high, saw its rally fade ahead of the Fed decision and then turned negative after the statement was released. It fell as much as 206 points before it turned positive again and marched sharply higher in the final trading hour.
The volatile trading came as the Fed signalled it will keep its benchmark short-term interest rate close to zero for at least another two years. The central bank also sharply downgraded its view of the U.S. economy.
Commodities
US Gold Futures 1750
The number 72 that is 1720 and 1772 are working well, for some strange reason when you get the extra 7 or 2 like 772 or 272 its much stronger than just having single number. I one the numbers play a part in chart geometry and are part of the 9 series of number, but apart from that I don’t know, but I do know as a trader they should always be used, being on the right side of then in your trade set ups is the starting point and trading to them is the other, in taking profits.
The other point here is the number 8 as 1800 (MinorLevel), I just see it as the profit taking number and the 1800 hasn’t come in to action yet but it will, the point of mentioning it, is another smaller sublevel 8 before the 1800 and that is the 1780 sublevel as part of subgroup2 (SG2). I know I’m rambling on here a little, but understanding these numbers, will improve your own trading, they give you something very real to work with.
Any way SG2 1772 is the natural selling price before the 18000 and this is unfolding with a sell off correction looking for support and the first leg down to 1720 is in five smaller waves so at minimum expect and abc a 5-3-5 structure
Oil WTI (Globex Futures) 78.40
The rally up from the low around the 76.50 to 83 is in three waves, so it’s a corrective rally, sure it can get more complicated of stay simple as an Elliott abc, but the point is that it is corrective a correction and once completed will continue down. The next step is waiting for the Major TradingLevel TL8 / 80.00 to become resistance in a series of failed retests, once you can recognise that it is resistance then you can short or add to shorts. The next degree of price levels lower is the MinorLevel 78 so this also can be used to add to positions and is the normal way of shorting, when working with a level, that is use the next lower degree of level as the trigger.
Oil will follow stock, so be aware of the Dow when it touches TL1 / 10,000 as we are looking for the low of Wave 3 in most indices, with a rally up in to wave 4 and then down into wave 5
Base Metals
US Spot Prices (24HR in l/b)
US Copper: Last: 3.96-
US Nickel: Last: 9.63-
US Zinc: Last: 0.94+
US Aluminium Last: 1.07+
Copper (Globex Futures) 391
Will go through a process of pattern making that will trap it under the MediumLevel 4 /40 as resistance, yes it may spike to 410 even 420 but in the long run will find the ML4 as the resistance, this will keep the ASX Materials sector pegged and the MediumLevel 11500 will become the centre of attention over the short term ahead.
Forex
US Dollar Futures CFD: DXY 74.50
We should stay with the general premise that the 75 is the line in the sand for the larger direction. The Feds will have their fingers close to the printing press, which doesn’t help in reading the natural flow of the markets, so keep position sizing smaller.
Support, as long as the price stays above the 74 the general support is in place and with the SP500 finishing its rally from yesterday should now see more downside which in turn should se the Dollar push higher. So narrowing the 75 and 74 range into its sublevels, the Midpoint is the centre as support or resistance 74.50 then there is SG1 and SG2, if the SG2 especially the pivot in SG2 74.72 can become support then you have a good chance of the 75 testing as support, if that is the case then scale in through SG1 of 75 (10, 20, 30) you know if the top of SG1 75.30 finds support then it can leave 75. But also understand where the Euro is and the SP500
I have mentioned the long side approach you also need to consider the downside path, as you need to eliminate the guess direction game and trade the support and resistance, getting from one price point to the next is the name of the game.
EURUSD 1.4275
TradingLevels: 144 -140 Range. The 142 has built some support, however the support is the first bounce so more pattern development is required to confirm, so once Japan has opened see how and where the price is sitting, what sublevels, Midpoint first 14250 then SG1 or SG2. If the SG2 14272 can find support then you can look at the long side with the 143 as support in mind. If the Dow is going to rally then the 11500 is the price point so line this up with the Euro, if the Dow moves under 10500 then it’s down to 10,000
Trade Strategy: A move under 142 is the downside trade.
AUDUSD 1.02
TradingLevels: It’s only natural to see a bounce off the Major TradingLevel TL1 / 1.00 and would see another trend up to 104 very roughly
Elliott Wave: The Wave 3 low at TL1 /1.00, the Wave 4 rally is under way and around 104 would be the 38.2% of wave 3 retracement and or the 4th wave of one lesser degree. An abc corrective rally, the a and b seem completed already. So a wave c up and should be in five waves and approx. the same size as wave a
Trade Strategy: Wave 4 rally, use the sublevels to try and trade to each full point 102 to 103
Expect a small abc at 102, once completed use SG1 to scale in.
Tentative CNY Trade Balance 27.3B 22.3B
Indices
Dow Jones CFD 11,067
TradingLevels: 38.2% retracement is around 11500 the MediumLevel and 1200 on the SP500 as wave 4 once completed the bear market will resume.
Elliott Wave: Consider Wave 3 low in place and the Wave 4 rally is underway
Trade Strategy: Wave 4 should be in three waves abc the Wave a and b are complete so the Wave c should have five small waves taking it to 11500
S&P500 CFDs 1,126
TradingLevels: The low on the cash was 1076 that is 4 points away from our target 1072 but within the SG2 zone
The Minor Wave 3 is complete and the Wave 4 rally is under way, however the rally is already over half way completed the target is the 1200 but the SG2 1172 zone will also offer resistance
Trade Strategy: Looking to short the top of the abc rally into 1200
FTSE 100 CFDs 5250
TradingLevels: The bounce back was normal and we now need to work with Minor Group1 5100, 5200 and 5300, the target is 38.2% of wave 3 that is 5400, so the top of MG1 5300 is the important price point as support or resistance, this is going to be tricky, any way the short term expect a retest of 5200 checking for support before moving higher.
Elliott Wave: Wave 3 completed and Wave 4 under way. The 38.2% retracement is around 5400
Trade Strategy: yes use the MinorLevels but trade the sublevels because we are in a corrective rally.
SPI Futures CFDs 4100
TradingLevels: The 61.8% of the 2009 pegged in a low around the 3800.
Elliott Wave: The low is considered the Wave 3 low and we are in the Wave 4 rally.
Trade Strategy: The Dow’s wave 4 rally can take it back to the 11500 MediumLevel and SP500 to 1200, the ASX200 38.2% rally is 4100, but because of the Dow’s 11500 price point then the 4200 is the probable first target. In terms of trading being above 4000 is positive and use the MinorLevel then the sublevels to trade. But remember the Dow Jones is in a rally to 11500 and once complete the trend down will continue, this is just the bounce off the 10,000 TL1 even though the price only reached 10500
Tentative CNY Trade Balance 27.3B 22.3B
Summary
The Minor Wave 3 low is in place for the Dow and the Wave 4 corrective rally is underway, the 4th wave of one lesser degree is the target and that is 11500, but can be lower. Once this wave 4 is completed then the bear market will continue back down into 10,000 for the Dow.
Our ASX200 had an early bounce along with Asia; our bounce was off the 3800 target the 61.8% retracement of the 2009 move. We are also considering the bounce here a Wave 3 low in place, even though it will or may past the 38.2% retracement level 4100 wave four’s normally have, we are staying with the main trend down but expect a move higher to 4200 plus. In terms of trading while the market is above 4000 is has a positive bias, that said we also need to consider that the main trend is down and not to get lost in buying, thinking you’re missing out on something. Sure trade long, but know where you are and what you’re doing, what price points you are working off and what price points you will exit at when reached.
For a positive market the Dow would require solid support on 11500 and the SP500 support on 1200.
Quote for Traders
"If rule governance and conscientiousness in following rules is associated with market success, then traders want to use emotions to trigger greater attentiveness to plans and rules. This means creating associative cues between emotional arousal and the behaviours responsible for trading success." Brett N. Steenbarger
Today's Financial Events
Time Currency Detail Forecast Previous
10th-13th NZD REINZ HPI m/m 1.3%
9:50am JPY Tertiary Industry Activity m/m 1.1% 0.9%
9:50am JPY CGPI y/y 2.6% 2.5%
10:30am AUD Westpac Consumer Sentiment -8.3%
10th-16th CNY New Loans 551B 634B
10th-13th CNY M2 Money Supply y/y 15.8% 15.9%
Tentative CNY Trade Balance 27.3B 22.3B
4:00pm EUR German Final CPI m/m 0.4% 0.4%
4:45pm EUR French Industrial Production m/m 0.3% 2.0%
7:30pm GBP BOE Gov King Speaks
7:30pm GBP BOE Inflation Report
NOTES:
1. Dividends & Reporting for your stock should be checked before trading
2. Prices may change as this report is written while markets are closing/trading
3. Always think things out for yourself, we are only here to bounce ideas around.
Want to Get EarlyBird Every Day? Register for your 72Hours free trial or buy 1Month (includes 30 minute coaching: $19.95)
.................................................................................................................................................................................................................
03 Forex: USDCHF – we remain bearish on this pair
The USDCHF has no other support until CHF0.7410 after selling off beyond the CHF0.7554/0.7550 support line and charting a new low of CHF0.7480, say dealers. They say rallies will find initial resistance at CHF0.7725, but will need to overcome the accelerated downtrend at CHF0.7944 to alleviate immediate downward pressure and signal a recovery to the six-month downtrend at 0.8285. Dealers recommend squaring trades, attempting tiny shorts on a rebound to CHF0.7725. Add CHF0.7825, stops over CHf0.7945, and cover CHF0.7410.
USDCHF 1 Hour Chart
Monday, 8 August 2011 at 6:55:00PM AEST
Swiss franc fell into a new low during Asian hours, before price bounced back above 0.76 area. If we take a close look on the price action from 0.7800 area then we can see that structure was quite slow and choppy. As such, this leg could be corrective, labelled as a wave b), which is part of an incomplete wave (iv) correction. Break above red trend lien will confirm that scenario. After that we will try to identify a top of a wave (iv), before we may look for a new sell-off, into a wave (v).
USDCHF 4 Hour Chart
Monday, 8 August 2011 at 5:05:00PM AEST - final stages of a wave 3
USDCHF fell into a new low in recent sessions as expected, after a corrective wave (iv) found resistance near 0.78 region. As such, wave (v) is already in progress, which in fact reached the first Fibo targets around 0.7520/50. If this area is broken, then watch for a fall towards 0.74, before an impulsive wave 3 completes, and market reverses into a larger corrective wave 4.
USDCHF Daily Chart
06 August 2011 - wave 3 underway
USDCHF extended its losses in the past week as expected and reached new all-time lows just above 161.8% Fibonacci extension target for wave 3. Not sure if wave 3 is done or not, but long-term speaking we remain very bearish on that pair, and any bounce from the lows will be only temporary and corrective, likely a black wave 4 before now sell-off occurs.
USDCHF Weekly Chart
20 March 2011 - huge wave V) underway; more weakness to come
A huge running triangle on USDCHF which has finished at 1.1730 region in June 2010, from where a sharp sell-off appeared. Prices also already moved below 2008 low, which confirms that a red wave V) is in progress. Even lower levels are expected, towards the 0.8000 region and even lower, as we anticipate a huge five waves of decline within a red wave V). Wave III of V) is underway.
Want to follow our Forex PLUS Gold/Oil/S&P500?
We have Intraday, 4Hourly, Daily and Weekly charts posted for Forex 6prs, Gold, Oil & S&P500
................................................................................................................................................................................
04 Great Trading Method + Best Platform = Easy trading!
After a successful period of trading our Robo Method over the last few months
we have found the perfect trading platform to do it on.
One of the main reasons for us using the GFT platform is the data and
the ordering system.
The ordering system has stand out functionality – you can:
– buy above the market
– have long and short trade set ups at the same time
– scale out of positions
– right click on the chart to place orders
– place auto trailing stops that you can set to trial the market price
These are all really useful for applying the Robo Trading Method
So far I think it’s the best platform out of the bunch as it also has:
– Thompson Reuters data feed (no data or platform costs)
– margins are lower than most other providers
– charting is excellent
WANT TO GIVE IT A TRY? FOLLOW THE STEPS BELOW:
1 Complete the Demo Form: click on this »link and fill out the basic form.
2 Download the Platform
After you have downloaded it, you get 1 month and we go into the back end of the
demo to add extra money – to $100,000. If you require more margin added just ask.
3 If you would like to apply for a GFT account here is the application link:
If you need any help at all please let us know!
................................................................................................................................................................................
05 30 Days of trades, analysis and education!
And we give you personal attention, all for $19.95!
Membership access for 30 days to TradingLounge™ Analysis includes:
– Robo Method trades delivered daily – you don't need to spend time on analysis
– Analysis & Strategies – for when you want the "why for"
– Loads of Education daily and through online courses
– Advanced CFD accounting software, ProfitKeeper® Pro
– Great Charting Software (has TradingLevels on every chart)
– Includes ProfitKeeper, CFD accounting and strategy tracking software
|
|
|
|
|
|
|
|
|
|
72Hr Access
Enter your details below
for Instant Free Access to the
MEMBERS AREA for 72 hours.
Then check your email
confirming your
Username & Password.
Always login with these and you're in!
|
|