amigo - there is no good and there is no bad, there is only trained and untrained!!
Good morning,
I am short oil, and have doubled my position.
I am long the Dax from yesterday afternoon. I am holding. The SP500 chart below is showing support, at least for now, at 1390. Remember that 1390 was tested and test during the last days of April. If it breaks, I think you need to get on the short side as 1325 beckons (is that the right word?). So until proven otherwise, the trend is up, and I would bet on a move higher of the coming days. It might not be straight forward. It never is. But the chart below stretches a fair while, and every bar is 120 minutes!!! So bear that in mind when you are looking at it: Volume hit into record territory on the sell-off (arrow), the trend is intact. The Stochs made a double bottom, as did price action itself. The last move down is equal the previous move.
The only thing you have to be concerned with, if you like me flipped from short to long: We just hit a 50% retracement (see earlier in the week) in the OEX and we have a clear 2-wave structure up from the lows in March. What if this is an ABC correction before the next big move down gets under way. So I will leave you with this for now. I will short below 1385.
I may or may not post some more later in the night or day.
Good night
Tom
22nd May 2008 05:55am
Good morning,
oil has just hit $135 in Asia and I have just gone short, using a 1 dollar stop. My position is small, but I will add to the short as and when it accumulates profit.
Last stand for the bulls in the DAX. I suspect there will be some support here at 7000 in the DAX futures. A dip below in the morning and a rally will do. However, as the Dow is already being called up 50 points, the sell-off in Europe will not be as bad as expected.
I am getting ready to buy the Dollar again. The chart below shows that we are coming up to a trendline - the last two legs up are looking like a corrective ABC and the 38% is looming just above the current price.
Below are the charts I will cover on CNBC this morning. Over the weekend I am on the Bloomberg Money show with a gentleman called Charlie Morris from HSBC. Mr Morris runs a fund and is a fan of charts too. It will air over the weekend.
The OEX index hit a 50% retracement. If you compare that to the sell-offs during the 2000-2002 bear market, you will see that the initial bounces made a healthy recovery. The first sell-off retraced 80%. The next one retraced a little over 38%. The next one retraced less than 38%. It is a classical sign that as the trend strengthens, the bounces becomes weaker. Therefore the 50% retracement is important to watch this level. Any solid close above it could spark a rally towards the old highs.
I have been converting pounds into Euros for some time. I don't see any reason why this trend should not continue. The next target is 1.18, which is a technique I use called half/double span. The problem with the projection is that I am aware I don't have enough data to make a proper forecast.
This chart attempts to explain the rate of change in oil price vs the average price over x periods back. On the oil chart itself you can see that we have had 3 major legs up, of which the 3rd one still is in process. The 2 other legs have both seen percentage rises of more than 200%. So far the current move up is only 144%. However, I am also pointing out that during the previous price rallies, any price rise that increases more than 20% from the average price has been met by steep declines. My conclusion is that oil is going vertical, and it is at the point where any breakdown from a consolidation should be shorted heavily. I did that last week, when oil broke down. I was very profitable on the initial shorts, but I ended losing on balance as the market bounced back strongly.
I have just been told that CNBC will not be able to show the table in gray on the chart below
21st May 2008 07:18am
Good morning,
I am on CNBC today at 11:35AM to talk about the technical outlook for the markets.
Until then I am preparing some charts. I will update the site either just before CNBC or after. In the meantime I will post the Market Map for the FTSE. It worked well yesterday. Here is the one for today:
Tom
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20th May 2008 06:24am
Good morning,
After the fizzle in the US last night the UK and European markets are being called lower. I have included the DAX map for today. The FTSE looks exactly like it. So if we are getting a lower open, according to this program, we will get a stronger closer than the open.
This ties in with the other chart of the SP500. We could have seen a major reversal right now. The turn I have for this week is on Thursday, which is a good turn with several time cycles all hitting at once. I think it will be a high and i will watch the levels indicated on the chart of the SP500. At the 61.8% we will have a double extension. If it comes on Thursday, it looks like a perfect spot to go short. However, I can't ignore what I saw on the OEX index:
Click on the charts to enlarge them.
Have a nice trading day.
Tom Hougaard
19th May 2008 06:50am
Good morning,
I am looking at the DAX this morning. The 240 min chart is looking solid UP after the recent consolidation. However, the daily chart next to it could potentially warn us of a double top. The oscillators are beginning to to toll over. This is one to watch.
I will be watching Crude Oil today. It doesn't look like there is any let up in the trend higher. It feels quite safe to be long as long as we hold above $124. Anything below that will make me push the short case.
Announcement: I have completed building the infra-structure to the TraderTom LIVE Trading Room. I am testing it at the moment. I will announce the release here on TraderTom, once it is fully functional. The purpose of the room is to provide you a look into my trading day, and to see when I am buying and selling, and when and what markets etc.
ANALYSIS
