October 31, 2010

  • First chart of apple shows the important support and resistance lines.
  • Stock has good support at 294 levels. Correction that started from 319 levels may get support at 294 or before that.
  • Correction was because of the HANGING MAN candlestick pattern that appeared at the top of the trend. Stock has also broken and closed below 20 DMA as shown in the 2nd chart.
  • Stock may give a buying opportunity if the resistance line in daily chart is violated. Trading above 310 apple will gain upward momentum again. 319 will remain as a good resistance area. Good up moves can only happen when 319 gets broken.
  • NFLX WEEKEND UPDATE

WEEKLY CHART

  • NFLX Daily chart with the ascending channel formation which shows the strong up trend of the stock.
  • But last weeks price action was negative for the bulls of NFLX. 
  • The negative price action is yet to test the GAP between 155 and 165. If the gap begins to fade price may test the lower support line of the channel and go up from there.
  • Weekly chart also shows a negative candle a PIN BAR which is a strong reversal candle. Candlestick pattern needs confirmation so only if the price closes lower a trend change can be expected. So before one decides to shot NFLX they  should have the primary trend of the stock in mind which is UP.
  • So buying on dips closer to the lower support line of the trend line is advisable.  
  • BAIDU WEEKEND UPDATE
BAIDU VOLUME ANALYSIS
BAIDU SUPPORT AND RESISTANCE
  • BAIDU has good support at 107 levels. 
  • The trend line drawn from 76 may also support the stock for the short term.
  • 113.78 is the immediate resistance.
  • Volume analysis shows that the buying volume was very high and the last two days of the week the stock had two negative days which had very low volumes. So we had negative price action with low volumes.
  • Last week when the stock was at 107 we noticed good buying volume and the stock rallied up to 113.
  • CLICK HERE TO SEE LAST WEEK'S VOLUME ANALYSIS ON BAIDU

  • US Dollar showed some strength this week but that is not enough as per the first chart. Price is still below the down trend line drawn from 88.
  • First chart also shows crucial trend line breaks and i feel one more of those trend line breaks may happen before the dollar rallies.
  • But if the trend line drawn from 88 breaks that may give some head aches for the bears of US Dollar.
  • The 2nd chart shows weekly RSI below 30% from here the probability of a reversal is very high but the positive divergence is not yet there. We can clearly see negative divergence when the weekly RSI was above 70% dollar rallied up to 88 and started falling down followed by the huge negative divergence. But i must say that it took many months before the negative divergence showed its effect.
  • To summarise there is an opportunity to sell dollar below 76.14. Things will look positive for the bulls only if the index crosses 79.82.
  • GOOGLE WEEKEND UPDATE

GOOGLE WEEKLY CHART
GOOGLE HOUR CHART
  • Google Weekly chart is showing a PIN BAR Reversal candle near resistance area.
  • It seems 628.94 will be the next resistance for the stock.
  • The shorter term charts like hour is also lacking up ward momentum.
  • Hour chart is showing a negative trend line break. If stock starts to move down a test of the GAP that came after googles results were announced.
  • MSFT Near 200 DMA
  • BAIDU WEEKEND UPDATE

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"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis."
—Jesse Livermore