August 17, 2011

  • Its a day of false breakouts.
  • Silver did an upper breakout from its rising wedge and gave a correction
  • Crude oil false breakout was from an ascending triangle pattern.
  • SPY and ES did gave false breakouts from the rectangles in which they were trading. Price is moving in the opposite direction.
  • Usually price moves well in the opposite direction after a false breakout. ES and SPY are doing it, But silver is trying for an upper breakout again.
  • Cisco is finding it hard to cross 100 DMA.
  • Rally of July was stopped at 100 DMA.
  • Rally started in this month is also hitting resistance at 100 DMA.
  • Up move will be possible only if price closes above this moving average. If it does not happen soon another correction will follow.
  • US Dollar daily chart is testing its support level at 73.515
  • If daily candle closes below this level then the next support is at 72.860.

  • SLV hour is showing a possible rising wedge pattern
  • Price is trending up above 20 Hour moving average.
  • If price starts to trade below 20 Hour moving average we may see an extended correction from the rising wedge.
  • US DOLLAR TESTING SUPPORT LEVELS
  • Copper hour is trading in a range from 3.9333 to 4.0635.
  • Bigger moves will be possible only if this range gets broken.
  • Till then selling at the top of the range and buying near support area can be done.
  • Silver four hour chart is showing a bearish rising wedge pattern.
  • One can try to remain short from the hourly chart.
  • Price falling below 50 Hour moving average will favor bears. Bigger fall below 200 Hour moving average.
  • Rising wedge will become invalid if the resistance line gets broken.
  • US DOLLAR TESTING SUPPORT LEVELS
CHART-III UPDATED

CHART-II UPDATED
  • ES has given a breakout from the range. Price sustaining above 1202 will favor bulls to extend the up move.
CHART-I
  • ES is stuck in a range between 1177 - 1202
  • Price is also moving around 50 Hour moving average for quite sometime now.
  • So a breakout or breakdown from this range which means moving away from this moving average may result in a bigger move for ES.
  • GOOG FALLS BELOW 50 DMA
  • S&P 500 ANALYSIS AFTER CLOSING BELL
  • Breaking below 5015 will give a short trade.
  • Above 5053 Bulls will become active and an up move is possible.
  • But everything is happening below 50 Hour moving average. So bulls need to get back above 50 Hour moving average for a bigger up move to happen.
CHART-II UPDATED
  • Break of 9939 gave 9855. For bulls price has to stay above 9939 otherwise selling pressure will be there. Taking out 9855 again will give another Dip in favor of bears.
CHART-I
  • Bears will be stronger below 9939.
  • Break of the resistance line can give an up move in favor of bulls.
  • Tata motors has clearly broken its weekly uptrend line. 
  • Price is about to complete 50% retrace in weekly chart.
  • Weekly charts are looking oversold.
  • Daily chart is starting to develop positive divergence
  • We might see another dip towards 750 - 760 levels before price starts to move up again.
  • Best way to play positive divergence after a big down move is to confirm with a close above 5 day high ema.
  • Stock is in a strong down trend so stay short while it closes below 5 day low EMA. 
  • Longs are possible only on a close above 5 day high EMA.
  • S&P 500 ANALYSIS AFTER CLOSING BELL
  • Hour time frame is still favoring bulls with price staying above 50 Hour moving average and the cloud.
  • Price closed below 38.2% Fib level. But day remained within the range of yesterdays candle.
  • Range is between 1180 - 1205.
  • Support level is at 1168.
  • Below 1168 Bulls will become weak.
  • Falling 20 Day Moving average might also act as resistance in the coming days.
  • RANGE OF SPY
  • Immediate resistance level for crude oil is the 50% Retrace level for the current fall. Price is not able to break above this level.
  • Major hurdle for the bulls of crude oil will be 89.60 level which was the previous support. Now that it has been broken this may act as resistance.
  • If price manages to break both of them then it will be safe to stay long.
  • GOOG FALLS BELOW 50 DMA

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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