28 September
200 TRADES IN THE MARKET
We use the Dow Jones, S&P500, US Dollar, Copper, AUDUSD and Shanghai as the main drivers for
trading local ASX Stocks and CFDs. In fact we probably have nearly 200 trades in the market.
Are you ready for the next leg down? Take the month trial and join the ride!
Market timing is obviously the trick to trading and you had the choice before this rally started to make
a move to the long side. If you took it then great. If you didn’t and you feel you have missed something
and are thinking of getting in now then you do not have market timing on your side and you are at risk.
If we are wrong with the analysis don’t worry as we would be long at the next correct time and that
would be if the Dow finds support on 11500.
Are you interested in trading Forex? This week our focus is on the AUDUSD.
Excellent ElliottWave analysis.
Contact us to take your trading forward, Pete.
PS. Call anytime: 0434 288 367 or 02 4448 6020.
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01 Today's EarlyBird Report – 28 September
Market Drivers
DDow Jones – 11,190 +1.33%
Base Metals Positive
US Gold CFD: 1650
Oil WTI CFD: 84.63
Copper CFD: 344
US Dollar CFD: 78.00
EURUSD 1.3620
AUDUSD 0.9960
Dow Jones CFD 11,300
S&P500 CFD: 1,185
FTSE 100 CFD: 5270
SPI CFD 3938
US News
U.S. stocks pared some gains in the final hour of trading after a report showcased a potential split in
the euro zone over the terms of Greece's second bailout.
Commodities
US Gold CFD: 1650
The price up around the 1650 MediumLevel is a Wave 4 and once completed will move down, the
lower volume also confirms this.
Oil WTI CFD: 84.63
The move up is considered a wave two and the 61.8% retracement level is around 85, but we
should also include the 86.50/72. This is in line with the Indices high wave two rally
Base Metals
US Spot Prices (in l/b)
US Copper: Last: 3.44+
US Nickel: Last: 8.61+
US Zinc: Last: 0.88+
US Aluminium Last: 0.99+
Copper CFD: 344
The 300 is putting up the support and the rally is a wave four and should slow down into 350
Forex
US Dollar CFD: 78.00
The support is 78 to 77.72 SG2 the wave structure should bounce around this range over the next
session completing an abc correction into this zone, this should also line up with the Dow /SP500
completing the later stages of their rallies
EURUSD 1.3620
TradingLevels: Considering the move up as a wave two rally on lower volume, however there is
volume support at 134, the rally targets can be anywhere from 137 to 138 technically speaking,
but I think we can also focus on what the Dow does at 11300 that is develops the 11300 as support
or resistance, give it some time to play out, this is the same with all global markets
Trade Strategy: Weekly Robo Stop 13837
AUDUSD 0.9960
TradingLevels: The retest to 1.00 was achieved from the current global sentiment; however expect
it to weaken at 1.00 in line with US Indices. You can see the trend getting weaker as it gets closer to
1.00, that is, on the five minute chart the ranges are getting smaller. Also observe Copper as it gets
closer to 350 as resistance and how the Dow plays out at 11300 the wave two rally target
Trade Strategy: Look for softening in the AUD
Indices
Dow Jones CFD 11,500
TradingLevels: The 11300 as support or resistance is a simple way to find out if the Dow has any steam.
I would only turn bullish if the 11500 become support.
Elliott Wave: abc corrective rally for a wave two can be completed at this current high
Trade Strategy: look for weakness, that is series of five waves down three waves up on the intraday
time frames
S&P500 CFD: 1,185
TradingLevels: The price move just above the 1172/80 target for wave two rally buts that’s fine, the
wave count would only be incorrect if the price made a high above 1220 (but check the cash of that price)
Elliott Wave: Wave two can be completed but there can also be another push to 1210
Trade Strategy: 1172 as resistance helps create the top of the rally and a move above the 1220 creates
a more bullish outlook, the 1200 is the line in the sand
FTSE 100 CFD: 5270
TradingLevels: I need to stay with the move up as a rally until proven otherwise, so only a move
above the 5400 would create a bullish picture. The 5300 and the 5272 are the prices to work with to
be long or short
Trade Strategy: Should see weakness at 5300 use this and SG1 and SG2 to get a position
SPI CFD 3938
TradingLevels: There is a Gap around the 4150 and the next level of supply passed 4100 is 4172
Elliott Wave: I have to treat the move up as a rally in line with base metals and US Indices,
I can say that I don’t fully understand the structure of the August pattern, so I need to use the
US markets as a guide , that said I do understand certain sections of the structure, which can be
helpful at certain times, but the main point here, is that the price is actually still working with 4000,
support on 4200 would create a positive bias and support on 4300 would create a bullish picture,
so any move up to 4200 is really a part of the 4000 storey, if the Dow found support on 11500 then
we could also turn bullish, but under this we need to treat these moves up as rally until prove otherwise
Trade Strategy: Another push through 4100
Summary
The Dow’s wave two rally was strong and reached into the supply zone at 11300 + but this should be
the wave two rally completed, yes we could get another push making a new short term high tomorrow,
however I would only turn bullish if 11500 became a solid support.These high retracement levels are
actually the same as the 2008 pattern at 11500 in the same month as now, we will look at this in the
video and the patterns are very simular and you will then understand why we need to allow this to
play out, it’s not about being right or wrong it’s about doing the right thing at the right time.
The Oil, Copper, Gold, Silver etc are having rallies of their own but are in moving together out of emotion,
they too should stop shortly in their tracks and reverse down.
Trading Quote
"When we think about events, either in our daily lives, or in the market or the economy, it is important
that we don't think of them as simply existing or coming out of nowhere. This is, because that is. This is not,
because that is not. We cannot create or remove a condition, expect it to emerge or expect it to disappear,
without understanding the seed that produces it, and the causes and conditions that allow it to spring up."
– Thich Nhat Hanh
Today's Financial Events
Time Currency Detail Forecast Previous
Tentative AUD HIA New Home Sales m/m -8.0%
4:00pm EUR German Import Prices m/m -0.3% 0.8%
All Day EUR German Prelim CPI m/m -0.1% 0.0%
6:30pm GBP BOE Credit Conditions Survey
10:30pm USD Core Durable Goods Orders m/m 0.2% 0.8%
10:30pm USD Durable Goods Orders m/m -0.4% 4.1%
12:30am USD Crude Oil Inventories -7.3M
3:15am CHF Gov Board Member Jordan Speaks
7:00am USD Fed Chairman Bernanke Speaks
NOTES:
1. Check the Dividend & Reporting section for your stock on this site 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.
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02 FOREX: ElliottWave count for AUDUSD
AUDUSD 1 Hour Chart
Tuesday, 27 September 2011 at 5:50:00PM AEST
Aussie recovered very nicely in the past few session, but in corrective personalty; clear a)-b)-c) bounce
from the lows right into the 0.9900 resistance region. We however need to wait and see if we are on the
right track with our bearish forecast; and that one will be confirmed only by an impulsive bearish
reversal, towards wave b) region.
Critical/invalidation level stands at 1.0175.
AUDUSD 4 Hour Chart
Tuesday, 27 September 2011 at 4:45:00PM AEST – corrective bounce; larger trend still down
AUDUSD already broke through August lows, so its more than obvious that new larger bearish leg is in
progress. After a significant fall seen in the past week out of the base channel, we believe that there is
more downside ahead and that current recovery is only a blue wave (iv), which will try to reverse from
one of the base channel resistance lines.
Critical/Invalidation level is at 1.0168!
AUDUSD Daily Chart
25 September 2011 – downtrend, likely within wave three of an impulse
As expected, Aud/Usd collapsed sharply, well below 0.9926 support and is now eying levels around 0.96
and even much lower after that. As you can see, we are looking at the new, updated count, which suggests
that significant top is in place at 1.0180 and that larger trend has changed from bullish to bearish.
A reason for that outlook is personality of a current decline from 1.0760, which is a typical third wave move;
sharp move in very short period of time. Typical target for this leg is around 0.9 psychological level,
specially once the base channel support line is broken.
AUDUSD Weekly Chart
25 September 2011 – bearish trend, weakness to come!
AUDUSD broke through and closed below a very important support line connected from 2009, which is the
most important evidence of a change in trend. As such, the updated wave count suggests that a five wave
recovery from 0.6 is complete and that prices are headed much lower, now into wave 4 territory.
We also have a bearish divergence on the MCAD, and a break below zero line will be just another
downtrend confirmation!
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