6 December
Technical Analysis Report Weekly
OUR WEEKLY CYCLE
All last week the cycle played out nicely: yesterday, Monday was bullish; that being the case, Tuesday morning brings the profit taking of Friday's and Monday’s run, with Tuesday afternoon resuming the bullish trend. If this is the case also check on the Dow Futures to see if they has found support into 12000. It is normal for Wednesday and Thursday to have the main swings, these are the days that collect your stops!
That said we can still day trade and scalp on the long side, but don’t get greedy, just trade to the next largest number and exit, don’t get stopped out.
Speak soon, Pete
PS. Call anytime: 0434 288 367 or 02 4448 6020.
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01 Today's EarlyBird Techncial Analysis Report – 6 December
Technical Market Drivers
Dow Jones – 12,081 +0.52%
Base Metals Positive
US Gold CFD: 1730
Oil WTI CFD: 101
Copper CFD: 360
US Dollar CFD: 78.37
EURUSD 1.3455
AUDUSD 1.03
Dow Jones CFD 12,160
S&P500 CFD: 1264
FTSE 100 CFD: 5563
SPI CFD 4344
US News Wire
NEW YORK – (Dow Jones) – U.S. stocks were ahead but off session highs Monday afternoon after a Financial Times report claiming that Standard & Poor's warned six triple A-rated euro-zone members that they may suffer ratings downgrades as a result of the deepening sovereign-debt crisis.
US Gold CFD 1730
Daily trend line resistance creates daily bar reversal holds even though the US dollar moves down, we are not seeing an increase in volume to the downside, but it’s worth keeping an eye on the volume increasing or decreasing to the downside to confirm the price action.
There’s not a lot to add here to what’s already been said yesterday, the 1720 as retested resistance is the first confirmation of the trend breaking down and support on the Midpoint 1750 creates another degree of trend higher. We are seeing the price test SG1* of 1700 that is 1730 | 1720 | 1710 but this is normal flow of a trend up to check the demand, it’s only weakness if the 1720 becomes the retested resistance, a subtle but important point
*See TradingLevels Intro
Silver
Resistance 33.00 you would also want 32.00 the pivot within Minor Group1 as the resistance to add to any shorts or take a short. The confidence in the lead up to the Euro meeting will see traders change from precious metals to stock, so weakness until the end of this week.
Oil WTI CFD: 98.00
While the price is above 100 its positive but can swing from 103 to 97 and still be part of the 100 TL1 story. Support on 103 creates the 105 and support on 105 creates 110.
Base Metals
US Spot Prices (24HR in l/b)
US Copper: Last: 3.60+
US Nickel: Last: 8.31+
US Zinc: Last: 0.92+
US Aluminium Last: 0.94+
Copper CFD 360
Precious metals fundamentally would go down this week on the Euro meeting and base metals rise on hope.
The wave count up that we have been chatting about is still unfold on track and the main point is that while the price is above 350 the Midpoint the market is healthy and in turn means the Australian market is healthy and we can stay net long.
The resistance for copper is the Subgroup2 (SG2) 365 | 372 | 380 zone with the 372 being the main price point in terms of trading and timing.
Forex
US Dollar CFD: 78.37
The price under 78.72 SG2 is weakness and above is strength.
EURUSD 1.3455
TradingLevels: Give the price time at 134 and then work the group1 & 2 for trade entries long or short
Elliott Wave: There are two counts here, expanded flat and zigzag refer to the Euro charts. I can walk you through the wave structure down from the afternoon session in the video
Trading Strategy: Work the sublevels at 134
AUDUSD 1.03
TradingLevels: If The RBA Rate day today.
Elliott Wave: The move down from 103 is an impulse wave
Trading Strategy: The game is the RBA Rate today buy the rumour sell the fact
11:30am AUD Current Account -5.5B -7.4B
2:30pm AUD Cash Rate 4.25% 4.50%
2:30pm AUD RBA Rate Statement
Indices Technical Analysis
Dow Jones CFD 12,160
TradingLevels: The price has spent a long time at 12172 in this session and now appears to want to climb higher, look for support above / on 12172 as support for longs, but if the price losses support at the Midpoint 12,150 then expect a larger bullish abc correction to unfold back into 12000, in the slightly bigger picture while the price is above 11,772 the Dow Jones is supported, that’s allowing for a 38.2% retracement from current highs
Elliott Wave: If support is not found on 12172 and 12200 then expect a correction here.
Trading Strategy: 12172 is the line in the sand
S&P500 CFD: 1264
TradingLevels: 1250 as support is positive however the 1272 will offer strong resistance, the SG2 is 1265 | 1272 | 1280 with the MinorLevel 1300 (mTL3)
Wave count: Expect a corrective pattern from the 1272
Trading Strategy: lf you long above 1250, then take part profit at 1265 and the rest at 1272, a correction is expected at SG2, the flip side is the Euro meeting propping up the price. Support on 1272 would see the price at 1300
FTSE 100 CFD: 53563
TradingLevels: The Dax and FSTE as both struggling to move higher, so expect a correction in line with the US markets. If the Dax can find support on 6180 then fine continue long otherwise tread carefully a move below 6072 is weakness.
Elliott Wave: Expect a corrective pattern here now, the pattern above 5500 is positive in structure but you can also see it struggling, its creeping up… expect a corrective pattern down in the sessions ahead, the flip side up side is support on 5572 and then 5600 you would run long with that into the Euro meeting
Trading Strategy: The price has not moved up much, so there can’t be a lot of hope in Euro for the up and coming meeting in Euro on Friday?
SPI CFD 4344
TradingLevels: If 4350 finds support be long, if 4320 becomes resistance expect a larger corrective pattern at 4300
Elliott Wave: The wave structure up is still positive, but because the 4300+ is old daily highs there will be selling / supply so we have to expect a corrective pattern at 4300, this can get choppy the 4272 SG2 is the support even though there is support from the 4320 – 4300 it’s just that if the price gets trapped under 4200 then the price is back as part of the 4300 mTL3 top of Minor Group1 storey and that brings in 4272 SG2
Trading Strategy: Tuesday can be profit taking in the morning and trend resuming in the arvo. The RBA Rate is today (same as for AUDUSD)
11:30am AUD Current Account -5.5B -7.4B
2:30pm AUD Cash Rate 4.25% 4.50%
2:30pm AUD RBA Rate Statement
Summary
The European meeting on Friday is bringing trepidation in markets.
The price is creeping up in European and US markets but on very low volumes, therefore we could and should expect to see corrective patterns in the US Tuesday, Wednesday and Thursday. If the patterns are corrective, such as the normal abc zigzag* patterns etc., then the point of them being corrective in shape and nature would mean once they are completed there would be further upside, most likely on the outcome of the Euro meeting. This is a thought we can work through in terms of Elliott and the TradingLevels.
*See Elliott Wave
Our weekly cycle: all last week the cycle played out nicely; yesterday, Monday was bullish, so that being the case, Tuesday morning brings the profit taking of Friday's and Monday’s run, with Tuesday afternoon resuming the bullish trend. If this is the case also check on the Dow Futures to see if they has found support into 12000. It is normal for Wednesday and Thursday to have the main swings, these are the days that collect your stops!
Quotes for Traders
“Develop a plan before you trade or do it later with less cash."
Today's Financial Events
Time Currency Detail Forecast Previous
11:30am AUD Current Account -5.5B -7.4B
2:30pm AUD Cash Rate 4.25% 4.50%
2:30pm AUD RBA Rate Statement
7:00pm CHF Foreign Currency Reserves 242.7B
6th-7th GBP Halifax HPI m/m 1.2%
7:15pm CHF CPI m/m 0.1% -0.1%
9:00pm EUR Revised GDP q/q 0.2% 0.2%
10:00pm EUR German Factory Orders m/m 1.0% -4.3%
12:30am CAD Building Permits m/m 3.2% -4.9%
1:00am CAD BOC Rate Statement
1:00am CAD Overnight Rate 1.00% 1.00%
2:00am CAD Ivey PMI 55.1 54.4
2:00am USD FOMC Member Tarullo Speaks
Tentative USD IBD/TIPP Economic Optimism 42.5 40.6
Tentative USD Treasury Currency Report
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02 Forex: AUDUSD – latest directional research
AUDUSD 1 Hour Chart
Monday, 5 December 2011 at 6:45:00PM AEST
No change! We still believe that pair will reach higher levels within a wave (D) pull-back of a triangle on a daily and 4h charts. So far, we have three legs up A-B-C, but because of a very strong upward reaction in the past week, we believe that there is more behind those bulls. So we are expecting more upside for now within W)-X)-Y) correction. The reason is also a slow consolidation around the top, which has a contra-tern price action personality, probably a triangle in wave X), so break higher should occur, towards 1.04 area.
RBA decision, release in coming sessions could be a catalyst for a break higher!
AUDUSD 4 Hour Chart
Monday, 5 December 2011 at 5:35:00PM AEST - corrective wave D)
No change after a rise into 1.0340 resistance area in the past week which completely invalidated bearish impulsive interpretations. Now we can clearly see that structure from 1.0751 is in three waves, which is a corrective move. As such, we suspect that this is just another leg of a huge complex wave IV correction, which is showing signs of a triangle consolidation. If we are on the right track, then wave (C) found the lows at 0.9649 and current sharpy rally is wave D), which may reach even higher levels in days ahead, around 1.0450/1.0500.
AUDUSD Daily Chart
4 December 2011 – wave IV trianglef IV
After a sharp rally seen in the past week from 0.9660 region, we suspect that pair is trapped in the middle of a triangle consolidation but still in complete. We know that triangles are structured by five legs, which means more sideways to come, before pattern is complete.
Meanwhile however we need to consider bearish possibilities as well, alternate bearish triangle count in B wave, especially once wave (D) is finished.
AUDUSD Weekly Chart
29 October 2011 – back to bullish
After some significant weakness seen a month back, pair reversed sharply from 0.933 region, bounced exactly from the upper base channel support line. As such, it seems that Long-term top is still not in place, and that impulsive sequence from 0.6 will continue, currently with wave V into 138.2, 161.8% extended Fibo levels.
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