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Factor Report – March 13th

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Market Review

Factor Moves are currently ongoing in:
  • Gold
  • Japanese Yen
  • USD/NOK
  • Copper
  • AUD/NZD
A Factor Move was terminated in AUD/NZD. A Factor Move is developing in USD/SEK and New Zealand Dollars. This issue of the Factor also comments on the Soybean complex, Euro, Heating Oil, Canadian Dollars and global stock markets.

Factor Moves in Progress

 

Copper (daily chart)

After falling from a high of 465 in Feb 2011, it appears that Copper bottomed at 193.55 on Jan 18. The advance on Mar 1 confirmed a H&S bottom. I have upped the initial price target to 231.90. An eventual test of the Oct 2015 high at 244 is likely. Factor is long one layer. 1     Read More

Patience … Discipline … Discipline … Discipline … Patience

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  I know my sweet spot. Every trader should strive to know his or her sweet spot. We should strive to only take a trade when the market set up is in our sweet spot. We should strive to avoid trades out of our sweet spot. If you, as a trader, do not know your trade set up with great intimacy, then how in the world will you know if you are exercising patience and discipline? Once you know exactly what your sweet spot is and is not, then the real challenges begin. The real challenges for me (and it could be different for you) are different nuances of patience and discipline.
  • Patience to wait for just the right set up
  • Discipline to sit on the sidelines and not getting pulled into a trade that does not fully satisfy my requirements
  • Discipline to pull the trigger when the right trade comes along
  • Discipline to remain detached from open positions and properly manage each trade according to trade management guidelines developed over decades of market speculation
  • Patience to allow a position with a substantial profit potential the room and time to bear full fruit
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Factor Trading – March 6th Report

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Market Review

  Factor Moves are currently ongoing in:
  • Gold
  • Japanese Yen
  • USD/NOK
  • Copper
  • GBP/CAD
A Factor Move is developing in AUD/NZD. This issue of the Factor also comments on Canadian Dollar, New Zealand Dollar, Australian Dollar and U.S. stock indexes.

Factor Moves in Progress

Copper (daily chart) There are several observations worthy of note on the daily Copper chart. First, note the premature breakout on Friday, Feb 26. The market broke out of the H&S bottom, but the rally could not hold. Following a premature breakout traders should be on extra alert and jump on a subsequent closing price breakout. Second, the advance and close on Monday, Feb 29 and especially on Tuesday, Mar 1, confirmed the H&S bottom. Both days served as buying opportunities. Third, for all practical purposes the target was met by Friday’s advance. I typically am conservative on determining “measured moves.” Factor is flat, having taken a crazy ride on the long side this past week.   image 1

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Gold – The Ultimate Charting Market – Report

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Gold Report – The Ultimate Charting Market

A History of Gold Charts

Free 47-Page Gold Report

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AUD/CAD – Chart Developing

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  AUD/CAD -  This cross flashed a significant sell signal on Friday. I view short AUD/CAD as a potentially rewarding cross in the weeks and months ahead. This is a cross that can be traded in the spot forex market or using futures contract on a one-to-one basis, although such a trade would be over-weighted to CAD.
The longest-term charts show that AUD/CAD have remained in a broad trading range for many years.
 
image
 
The weekly chart displays several patterns worthy of note. The decline in June 2013 completed a 24-month H&S top pattern. The decline from this H&S has queickly turned into a 41-month descending triangle pattern. This is this pattern that most has my attention. I believe that the completion of this descending triangle would result in a decline in AUD/CAD to the low end of the historical price range at .7600.
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Is the present decline in the S&Ps a déjà vu of 2011?

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Examining the chart structures of 2011/2012 with the present period

Classical charting principles at the core represent analog analyses -- that certain price patterns tend to repeat over time with slightly different variations.

An interesting analog situation has developed in the S&Ps. Some technical analysts have declared that the current market construction is analogous to 2011/2012 and will be similarly resolved by a continuation of the dominant bull trend. I completely disagree. Let’s examine the construction components of each period. The top chart is the S&Ps during the 2011/2112 period. The bottom chart is the current market.
  • Both periods had a textbook H&S top and, coincidentally, each top was completed in the month of August -- both marked as Stage 1
  • Both periods quickly met the target of their respective H&S top patterns only to develop a period of extreme volatility -- both marked as Stage 2
  • Both periods then rallied sharply back into the price zone of the initial H&S top pattern only to develop an other range of volatility -- both marked as Stage 3
2.23_ES_2011.2012 2.23_ES_2015.2016 Read More

Short England Long Sweden — that is what the forex markets are saying

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British Pound/Swedish Krona price charts displays extremely bearish construction

The weekly chart of $GBP/SEK completed an 11-month H&S top in mid January. This pattern has a price target of 11.18 SEK to 1 GBP. 2.23_GBP.SEK_W Read More

A chart that everyone stock trader MUST see

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How do you spell “Disaster?” There are two spellings”

AP Moller-Maersk

and

Sotheby’s

This week two companies had some very interesting things to say about their respective markets that have implications far beyond their individual niches.

First, AP Moller-Maersk, owner of the largest container shipping company in the world, said it saw, “massive deterioration,” in its business last quarter, even, “worse than in 2008.”

Next, Sotheby’s most recent London art auction was held on Tuesday where the company saw sales fall by nearly 50% from the very same auction last year. Furthermore, the famed auction house is now seeing former buyers turn into forced sellers.

The following picture is worth a 1,000 words.

Moeller-Maersk & Sotheby's

Many thanks to Factor friend and community member @DanChesler for bringing this chart to my attention.

$BID, $MaerskB:DC

plb

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The chart case for a bear market in U.S. equities

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All major U.S. stock indexes are forming potential tops

A case can be made based on classical charting principles that the current decline in the U.S. equity markets is just phase one of a larger price decline -- in other words, that U.S. stocks are in a bear market. Consider the following. Factor believes that the most significant price of the day is the closing price and the most signficant price of the week is Friday's closing price. The weekly closing price chart of the DJIA displays a possible H&S top pattern. This top has not yet been completed, but a Friday close below 15,800 would do so. 2.14_DJI_Wc Read More

Has a new bull market in Gold begun?

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Gold is the purest charting market of all. The Gold market always rings a bell at major turning points. Gold has been in a bear trend since the 2011. Well, guess what ...

Bell   Read More