Friday, 30 March 2012

Month End

Morning All

In my recent posts, I talked about taking some time away from the markets to re-group and relax. The feedback I have received has been overwhelming. Its great to hear other peoples stories and situations. Pls read through the comments field over the last 2 days as there is some fantastic personal accounts. I feel so much better having voiced some things and trying to focus on some new directions.

I thought I would share some setups here today. I will not be trading these with any size BUT the setups look very clear to me and I am sure there are many who could benefit from this. Equally, I just want to put my analysis out there to prove to myself that I do have an edge.

Bottom line, I see a tradeble short term low in place. I believe in the next few days we will see a good bounce that will take us back up to the highs in some markets. No doubt, this coincides with month end "window dressing" so please be prepared for all kinds of shenanigans.

Firstly to the S&P500. Last night I talked about shorting the Eminis in the 1400/1405 region and looking for a low in 1380/1385:
The high was made at 1404 and the low was put in at 1386.50. I think we will now see a continuation of this move higher back up to 1415 and possibly higher.

Emini S&P500 60mins:
Low right on the 38.2 Fibonacci retracement. A higher low has formed which is bullish. I think this completes a potential ABC type flat pattern with a move higher coming. The Daily trend is still very much up.

S&P500 60mins:
You can see this higher low and potential flat/triangle type pattern forming here.

Emini S&P500 15mins:
This is the clearest chart for the short term trader. Failed breakdown through 1394/1395, bullish divergences in place and a strong rally into the close. Get long down to 1394, stops below 1385, add to the position if we see confirmation of a breakout above this trendline in the 1400s. There are only so many times a market "tests" a trendline before it gives way. Once its obvious, it will no longer work. Thus I anticipate a breakout

For confirming evidence, we have the DAX in a perfect low risk BUY zone.

DAX 60mins:
ABC off the top into the 61.8 fib retracement and the gap target. Obviously the sell off looks "sharp" for now but that is how C waves are supposed to look. Bottom line, if it is going to turn it will be right now. Look on a Daily chart and you will also see a perfect hit of the Daily trendline.

The AUD is also right in the buy spot with a retest of its recent lows. I have no idea if this does actually double bottom but it is right in the zone for a bounce with a failed breakdown last night.

AUDUSD June 60mins:

To Australia. Simply I think you have to be looking to buy this first retest back into the previous breakzone. This is 4330/4325 in the SPI.

SPI 15mins:
Yesterdays low was 4340 and we are indicated there this am. I think it is possible that we see a bit of early weakness and look to get long into the BUY zone labelled here.

Also note that most of Asian markets were in free fall yesterday with the Hang Seng and China registering -1.5 to 2% falls. However, the SPI was rangebound and held in with only a small sell off late in the day. I think this is indicative of underlying strength.

XJO 15mins:
This is a simple chart to me. A clear base pattern below 4310/4300 and breakout. I think you have to focus on this uptrend as long as 4310/4300 holds. The targets are 4350 (which was hit yesterday) BUT more importantly up at 4380. Note I think that we are also in somekind of 4th wave type consolidation pattern.

My SPI range today: 4335 to 4385 (bullish I know). Outlier levels 4320/4325.

My top ideas:

i) BUY a retest of 4335/4330. We are indicated at 4340 early which is yesterdays low. If we see an early break, I will look to get long into the low 30s, tight stops.

ii) BUY a deeper pullback to 4225/4220. If the initial support zone doesn't hold, I think you have to try one last time to get long into 25/20. Stops below 20. If we break through here, we are indeed a lot weaker than anticipated so be prepared for a breakdown/trend lower

iii) SHORT FADEs at 4262/4265. This zone was offered yesterday and look to get out of any initial longs into this zone. I will short fade here for scalps only. I will then flip to breakout trades targeting the 80s if it does break but I obviously have no idea if it will.

Good luck