Poised for the next rally! - Market Analysis for 27th June 2011 by Singaporeseeds

Daily chart for Dow


Daily chart for S&P


Daily chart for NASDAQ


We are now in the longest down market since the 2008 subprime crisis. The market had been going nowhere and looks to be so for the next few weeks.

On the charts, all three indexes are now just above their 200 day moving averages and had spent the last 2 weeks bouncing on it. This level are also near some kind of support for all three indexes.

I believe we are close to the beginning of the next leg of market rally. We might consolidate for a few more days but i’m now waiting for a signal to long the market. Next target at 1,430 for the S&P.

Daily chart for Dollar


The dollar UUP had formed a wedge since early May 2011. Volatility had been decreasing and whichever side it breaks out from will determine its direction for the next few months. I still believe it will break down to complete it’s fibo retracement at 19.70.

Daily chart for Gold


Since my analysis for the dollar is down, this should also mean that I believe the medium term trend for most commodities especially the metals will be up. However Gold had been forming a bearish divergence on both RSI and MACD with a triple top at 151.50. This is very bearish but gold had formed numerous failed bearish divergences that kept breaking to new highs over the past few years. I’m going to sit out and just observe this one.

Daily chart for Silver


Silver seems to have formed the classic parabolic movement. A huge spike up followed by a rapid drop and then a bounce that fails to break above 50% of the last spike. Silver also broke down out of it’s up channel last week. I believe it is going to move to its next support level at 30 over the next few days.

Daily chart for Crude Oil


Crude Oil is at support at 35.46. I believe the recent downtrend had ended. We should see some kind of bounce soon.

Daily chart for Natural Gas


Natural Gas had been going sideways for the longest of times. I’ve always said that this is going to be a long term play since the first day I wrote about it. On weekly charts, it is showing the strongest of bullish signals. I believe the movement for Natural gas from now on will be up and slow.

http://www.nytimes.com/2011/06/27/us/27gas.html?_r=2&hp

Anticipating another dead cat bounce - WMA 19 June 2011

TIP
The weekly and daily TIP bonds appear to be in a range with all indicators weakening. Breaking out of 112 or breakdown of 110 would be indicative of the next move.

JNK
The weekly chart looks bearish, however, the past week saw massive selling on Thursday but was abruptly recovered on Friday. This placed JNK just above support after a day of heavy selling. A bounce in JNK is in place and it would be important to look for clues to its intended direction over the next two weeks.

/HG
Copper futures are in a weak uptrending channel with contradicting indicators. This put prices in a range but the daily chart appears more decisive as it appears to be bouncing off the Fibonacci Fan support.

According to the Napier’s leading indicators, it seems that the equity markets are somewhat indecisive, and a short term relief rally should still be expected in the mean time.
 
/ES
The S&P500 futures had been showing a trend change and the past week confirmed that it has in the short term, a trend change. The bearish divergence on the weekly has played out and is in the process of a major correction. This volatile week ended with a doji and it appears that the next two weeks may be range bound. While other indicators are showing a weakening backdrop, the Force Index is suggesting that a relief rally should be in place for the next week or so. The daily chart clocked the dead cat bounce on Tuesday, and keeled over last Wednesday. The Force Index is hinting of another bounce from a oversold condition. This is likely to bring the ES to the channel resistance at about 1285.

/DX
The USD futures weekly chart looks to be forming a bottom and a higher low was registered recently. The daily chart shows that a break and test of the 50 MA is in process and the outcome of this should give a clearer indication of where equity and commodity markets would be moving in weeks to come. There is still a bullish undertone to the USD and expect a very possible multi month rally for the USD.
 
/CL
Crude weekly chart looks bearish and a support of 85 looks likely. The daily chart shows that Crude got hammered over the past week, and may be due for a bounce to about 97 before continuing its way down to 85 at some point.
 
/GC
Gold weekly futures chart show a very long rally. The daily reveals the age of the rally where a range is keeping prices between 1480 and 1550. It appears to have bounced off the uptrending channel mid-support. A possible bullish factor.

The MadScientist 19 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.

Ah ha! Dead cat bouncing... 14 June 2011

COMMENTARY

Previous analyses:

12 June 2011
/ES
.... The daily chart is downtrending in a channel and just broke down the downtrending channel support. The indicators are very bearish, but a deep oversold condition has arisen. Bearish with a dead cat bounce due.
Link 12 June WMA

13 June 2011
S&P500 Long range
SPX Monthly reveals a lot of interesting insights…
The monthly chart has an obvious Fibonacci fan pattern that reveals a top is in place, ...
... and price looks for a break of the uptrending support. However, this very uptrendline is likely to provide a dead cat bounce support for the short term. Breaking this would mean a good correction to about 1200. At this point, the RSI should also bounce off the Fibinacci fan support
Link 13 June SNAPSHOT analysis

Spot on, yesterday marked the start of the rebound, and today is a follow through. It is likely to turn around, and the later it does, the worse the following down will be.
Watch for it!!!

The MadScientist 14 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.

SNAPSHOT ANALYSIS – 13 June 2011

Singapore EWS
The EWS (iShares MSCI Singapore) does not look too good after a clear double top. It looks as if there is another 2-5% to be lost in the near term and failing to find support on a long term uptrendline, it may find itself at 13, from the current 13.63.

S&P500 Long range
SPX Monthly reveals a lot of interesting insights…
The monthly chart has an obvious Fibonacci fan pattern that reveals a top is in place, one that stems from a long range fan and the other a more recent fan. The candlestick patterns, if June closes at current levels, make a convincing bearish reversal pattern, and price looks for a break of the uptrending support. However, this very uptrendline is likely to provide a dead cat bounce support for the short term. Breaking this would mean a good correction to about 1200. At this point, the RSI should also bounce off the Fibinacci fan support
Playing with cycle brackets, it is interesting to see that there are a couple of repeatable patterns on time cycles. 2H2012 looks like the next best window to buy in long range.
The MACD crossovers also have a time cycle and it is shown in red and green time cycle brackets. The periodicity is a little uncanny, given that the green time cycles appear to be best timed and 2015 is the next big move up.

Image Link - http://imageshack.us/photo/my-images/232/spxlr.jpg/

The MadScientist 13 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.

Back to 200 - Daily Market Analysis for June 13th 2011 by Singaporeseeds

Daily chart for Dow


Daily chart for S&P


Daily chart for NASDAQ


With the S&P just a little above its 200 day moving average at 1,255, we are nearing a bounce zone. This is also close to the March lows and the first support that the indexes will hit. Should this support fail, the next support will be at 1,215.
I’m beginning to feel that we might have just passed the high of the year and it will be downhill from now on. If history’s a good guide, we should close the year flat and that will be a best case scenario.

Daily chart for the Dollar (UUP)


The dollar came back to test resistance at its 50 day moving average. I’m still biased down with a target at 19.75.

Daily chart for Gold (GLD)


Quote from my market analysis on 24th May 2011:
“Gold did a big bullish candle bounce on top of its 50 day moving average on Friday. This is a very bullish sign. Target at 156.”

Quote from my market analysis on June 6th 2011:
“Gold (GLD) seems to be forming a bearish divergence on both MACD and RSI though that does not necessarily mean it will not hit the target at 156. However this shows that this current rally may be running out of steam.”

No change.

Daily chart for Silver (SLV)


Quote from my last market analysis:
“Seems to me that it may continue trending upwards in this channel for a while. With the dollar back in a downtrend and inflation rising, the fundamentals favour up. But the huge range of resistance between 36.7 and 38.2 will act as ceiling for some time. Should silver rally above this ranges of resistances, I believe the movement will be drastic and huge.”

No change.

Daily chart for Crude Oil (USO)


Quote from my last market analysis:
“Crude Oil (USO) is bouncing off its 200 day moving average and trendline support. The behaviour of crude is very similar to silver as it seems to be preparing for the next phase of movement be it up or down. I’m favouring up for both now.”

No change.

Daily chart for Natural Gas (UNG)


Natural gas (UNG) is showing a bearish divergence on RSI and MACD. We should see some price weakness over the next few weeks. But as long as it keeps above the 200 day moving average, my bias is still up.
Natural gas has been lagging all the other commodities. Should Monday close as a bullish candle, it will form a bullish pattern on candlesticks. This should bring UNG up above its resistance at 12.50.

Dead cat to bounce - WMA 12 June 2011

TIP
TIP has been trending within an uptrending channel for the past two years. It broke down of the channel to find the lower support and just tested the uptrend support-turned resistance. The resistance proved to be strong for the past weeks and the daily chart has Sell signals with weakened indicators. The RSI, Stochastics and Force Index are in bearish zone and the MACD is likely to follow through soon. TIP looks bearish now at 110, and has support at about 108.

JNK
JNK has been raning in weeks and closed below the immediate support, only to find another support line. The daily chart shows a steep sell-off in JNK on Friday This steep sell-off has placed JNK in deep oversold territory and is due for a pullback. Bearish overall, with technical rally soon.
JNK daily underscores the hordes of selling in the background of the market. Corporate bonds are where money for the companies lie, and according to Napier, it is a source and leading indicator of the market. This heavy selling is seriously telling something, even for the weekly chart. The Setup is way out into depression that a bounce is due over the next few trading days. Thereafter, it should continue the weekly trend. Watch this one!

/HG
Copper is not looking good on weekly nor daily. The weekly chart shows a correction in place, and the daily chart has bearish inclinations just as it is reaching a Fibonacci Fan support. It looks likely that a break of this support may happen and if so, it has a pretty long way down.

According to Napier’s leading indicators of the equity markets, they are either bearish or bearishly inclined. This is likely to be where the bears take over.

/ES
As reflected by the leading indicators, the S&P500 (and the ES futures) have reacted to the latest spate of bad economic news and a 6 week sell-off has been in place. The weekly chart has indicators all indicating a change of trend and the RSI and Force Index are in bearish territory. The daily chart is downtrending in a channel and just broke down the downtrending channel support. The indicators are very bearish, but a deep oversold condition has arisen. Bearish with a dead cat bounce due.

/DX
The USD futures had been way oversold and has bounced once again. Both the weekly and daily charts are showing a convincing rally and is likely to signal a trend change. Fundamentally, this may coincide with the end of QE2, and it remains to be seen if that is true.

/GC
Gold has had a beautiful rally over the past two years, and it looks as if it is about to end temporarily. The May correction in Gold followed by resumption of a rally did not look convincing and with the USD attempting a recovery, Gold may be in for a good correction. The Daily Gold chart has failed to make a higher high and looks unlikely to be doing so.
 
/CL
Crude has had a volatile ride in recent months. After rallying strongly due to the Middle East issues, it dropped to erase 50% of that gain in a week. Thereafter, crude has been ranging about 100 for the past month. Coincidently, or not, crude has been trekking along a Fibonacci Fan support line but has not broken the support although indicators are weakening. With a rally in the USD, it would be difficult to maintain its uptrend for and is expected to fall as well in coming weeks.

/SI
Silver sutures just go to show that it is going down…

The MadScientist - 12 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.

Topped out - WMA 7 June 2011

TIP
TIP weekly chart is ranging and the rally in previous weeks had stalled. The daily TIP chart is had a SELL signal late last week but has been ranging since. Technicals are weakening and should show its true colours by the end of this week. Bearish inclinations observed.

JNK
JNK weekly chart had clearly broken the uptrendline last week and this week continues to remain weak. The daily JNK chart is showing a lot of dumping of coporate bonds particularly over the last two trading days, sending JNK into a deep oversold position. It would be due for a technical bounce over the next few days and should continue its downtrend again by mid next week.

/HG
Copper futures show struggling bounces to lower prices, but just barely. Admittedly, the metal price has been rather resistant to a correction. For now, it looks like battlezones have been drawn and that is where price is.

From Napier’s leading indicators of the equity markets, 2 out of 3 are looking weak and bearish. Over the next week or two, the equity markets should be heading lower despite a relief rally of sorts over this mid-week.

/DX
The USD in recent weeks made an effort to rally significantly and then hit the final of three resistance levels and reversed back down. The USD futures daily chart has a lot more downside to go to confirm a resumption of the downtrend and for now, it looks set to form a higher low which should be done by midweek.

/ES
The weekly S&P500 E-mini futures chart had a Sell signal two weeks ago and broke out of a short term channel at the same time. The daily chart shows the testing of the channel and a failure to break in again, which was followed obviously by bearish indicators. The last week saw the USD futures/index lowering together with a lowering S&P500. This asynchrony is about to end soon and the true colours of the new trend would be revealed. A rising USD would push the equity markets further down, and the SP500 is well underway into a bearish turnaround (MACD, RSI and Stochastics have all crossed into bearish territory).

/CL
The crude futures are in a range that appeared to break out briefly and returned into range. Typically, when that happens, it usually works its way down to the other side… Whether this happens or not will depend on many factors, economic, geopolitical and so forth. This needs more time to be revealed.

/GC
The Gold weekly and daily charts look bullish to me. How that works out with a rising USD puzzles me at this point, although it has had happened before. It looks like a matching top is being attempted as the technicals appear dubious in an intuitive way.

The MadScientist - 7 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.

And down we go again! - Market Analysis for week 6th June 2011 by Singaporeseeds

Daily chart for Dow


Daily chart for S&P


Daily chart for NASDAQ


Quote from my market analysis on 24th May 2011:
“We are still looking at a stimulus to bring the markets to its next leg either up or down. As long as the S&P does not break support at 1320 I’m going to be upwardly biased with target at 1425 for the S&P.”
The 1st of June is usually the most bullish day of the month. That ended up as a long bearish candle that broke 1,320. S&P closed a little above the psychological support level of 1,300 on Friday.
At this moment, S&P futures are below 1,300.
With a bearish MACD divergence and a RSI trendline resistance, the probability of the index moving up had diminished greatly.
If the bearish MACD divergence pattern plays out, this would bring us down to around the 200 daily moving average at 1,250 on the S&P. That is my new target for the month.

Daily chart for the Dollar (UUP)


Quote from my last weekly analysis:
“The dollar dropped below its 50 day moving average on Friday. Seems like the dead cat bounce is over. Target at 19.75 for UUP.”

No change.

Daily chart for Gold (GLD)


Quote from my market analysis on 24th May 2011:
“Gold did a big bullish candle bounce on top of its 50 day moving average on Friday. This is a very bullish sign. Target at 156.”
Gold (GLD) seems to be forming a bearish divergence on both MACD and RSI though that does not necessarily mean it will not hit the target at 156. However this shows that this current rally may be running out of steam.

Daily chart for Silver (SLV)


Quote from my last market analysis:
“Silver (SLV) is approaching resistance at 37.48 and then 38.20. It has to either gap or break above these two levels before it can continue on its rally. This I think will happen over the next 2 weeks.”

Seems to me that it may continue trending upwards in this channel for a while. With the dollar back in a downtrend and inflation rising, the fundamentals favour up. But the huge range of resistance between 36.7 and 38.2 will act as ceiling for some time. Should silver rally above this ranges of resistances, I believe the movement will be drastic and huge.

Daily chart for Crude Oil (USO)


Crude Oil (USO) is bouncing off its 200 day moving average and trendline support. The behaviour of crude is very similar to silver as it seems to be preparing for the next phase of movement be it up or down. I’m favouring up for both now.

Daily chart for Natural Gas (UNG)


Quote from my last weekly market analysis:
“This is it. UNG gapped above its 50 day moving average and is now just below its 200 day moving average. With the two most important moving averages converging soon, we should see some kind of price action this week. I’m thinking up.”
Natural gas (UNG) finally broke above its 200 day moving average. It may take another week or two for the 20 and 50 day moving average to cross the 200 day moving average. This will be the best sign of bullishness for UNG.
However the bearish divergence on MACD and RSI are indicating that there may be some price weakness for UNG over the next few weeks. We may end up seeing UNG going nowhere for a few more months.

Market Alert - 2 June 2011

/ES weekly Setup is continuing with an earlier Sell Signal, as it seems. The daily Buy signal two days ago was countered by a Stop Loss just two days later and today is likely to have a Sell signal at the close. Our system when it fails like that, has a high probability that signals a major reversal. Combined with the current technical picture that show a massive bearish engulfing, testing and failure of a channel support-turned-resistance, plus RSI and MACD for weekly and daily, the resulting picture is omnious.

This reaction for seemingly less than desirable appears a little overdone for a -30 loss on the S&P500. Either an overreaction or underlying fear showed hand a little… looks bad till Triple Witching this month, plus June ends Nasdaq’s best 6 month run.

Looking at JNK and /HG and TIP, Napiers leading indicators for the market, it too does not look good. Similarly with JNK, a Buy signal was abruptly countered with a SL plus bearish candlesticks breaking an uptrending support line.

The MadScientist - 1 June 2011

Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.