January 23, 2011

  • Dell daily chart shows a trend line break and price breaking below the 50 day moving average at the same time.
  • weekly candles have been giving bearish candles for the second week in a row.
  • Shooting star weekly candle is now followed by a bearish engulfing pattern.
  • Hope for the bulls lies at the recent low at 13.12. If this level does not hold stock will continue to slide.

  • MSFT weekly chart shows price struggling near the 61.8% Fibonacci level.
  • Weekly chart is showing a shooting star candlestick pattern. 
  • Daily chart too is showing negative price action. If the small triangle like pattern gives a support line break then stock may continue to fall till the 50 DMA. 
  • For bulls Price is still above 50 and 200 day moving averages so Bulls will be comfortable to hold long until the 50 DMA breaks.

  • Death cross happened in September 2010 But Dollar has not recovered from its effects yet.
  • After the death cross dollar went to 75 levels. From there it retraced, But the retrace trade did not test the 200 day moving average. Dollar got resisted below the 200 day moving average and has now broken below its 50 day moving average and slipping down further.
  • There is a double top pattern in daily chart too if price sustains below 78 we may see 75 levels again.
  • Only way for the dollar to get out of this death cross effect is to close above 200 DMA which looks too far away at this point of time.


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My Favourite Quote

"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