Saturday, November 27, 2010

Continuation of the Down Move - Market Analysis for 29th November 2010 by Singaporeseeds

Daily chart for Dow

Daily chart for S&P

Daily chart for NASDAQ

S&P tested its 20 day moving average at around 1,120 twice this past shortened week. The indexes failed to rally above on both attempts. This is bearish for the index especially since there is still a bearish divergence on weekly charts. This week we will see the indexes test the 50 day moving average. Failure to hold the 50 day MA will see the S&P trend down to its 200 day MA. This would be around 1,150.
However with the RSI and MACD so flat now, it seems everyone is waiting in anticipation of the events happening in Europe and Korea. Depending on how it turns out, the market may spike either way.

Daily chart for the Dollar (UUP)

The dollar rallied as expected. The probability of a bullish divergence rallying is much higher than that of a bearish divergence tanking. Always love to trade bullish divergences. The other recent bullish divergence is Natural Gas.
We are very close to the 23.32 resistance level. However I believe this rally should bring us up to around 23.75.

Daily chart for Gold (GLD)

Gold seems to be forming a head and shoulders pattern with support at 130 over the past few weeks. This is coupled with a bearish divergence. Gold had almost doubled since the financial crisis when it tanked to 700. I believe this 2 year rally is running out of steam soon.

Daily chart for Silver (SLV)

Silver did a parabolic move over the past few months and had just made a double top with a bearish divergence. I believe it is on its way down now. As I’ve stated last week, if it failed to make a higher high soon, the chances are that it will crash down to 20 real soon. I think the down move had already began.

Daily chart for Natural Gas (UNG)

Natural Gas did a bullish divergence too. It has now broken above the 50 day moving average and had been pausing above the 50 moving average for this past week. I think we should be able to see an up move this week. Target at 6.8.

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