Comments « Sorrows of young Trader

May 21st update

May 22, 2012 by mdm 7 Comments

Finally, it looks like the bounce has started. Both euro and SPX, deeply oversold, rallied today in a convincing manner. Some uncertainty remain about the near term count, but i’ll try to spot the end of this rally (that should have some leg in the next few days)

Euro

If Friday’s low is the end of wave (3), then this is wave (4) and should stay under 1,30. If this is just wave 1 of (3), then it could go little higher, between 1,3045 (61,8% of wave 1) or until 1,31 to backtest the neckline. Today it should have complete wave A of this correction, so is it possible to see a modest pullback in wave B before grinding higher.

SPX

Here i could see many possibilities.

- the recent low is wave 3: now we are in wave 4 and should stay under 1356 (w1 territory)

- this is wave i of wave 3: the bounce will go until 1368 or little more in wave ii of 3 before crashing

- this is a complete A (insted of 1) – B (insted of 2) – C down, and this bounce will lead to new highs.

I remain with the bearish view, but i see both first and second options as equally likely. I’ll need to see the subwaves of the bounce before committing to a target for the bounce. I think it will clarify in 2 or 3 sessions.

i know i’m neglecting gold and silver recently, given that they were my point of strenght in the first months of this blog. But i’m still doubtful about the near term (both failed to retouch december lows) so i don’t want to commit. However i’ll try to formulate a bearish and a bullish option in the next posts.

Filed under Comments, ES, EuroFx

Weekend update

May 14, 2012 by mdm Leave a comment

There weren’t great developments in the past two sessions, so despite the new low in Euro, il stick with my previous projections that we are probably going to see a bounce before any substantial drop. The way i counted the impulsive structures down allows for another one low, but nothing has changed so i won’t post new charts being valid the previous.

Obviously, consider that i’m waiting for a countertrend bounce, that could not be deep as textbooks require. So always remember that for now risks are to the downside. I think tomorrow will be telling, so i’ll post charts tomorrow night.

Have a nice week

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April 11th

April 12, 2012 by mdm Leave a comment

Not many changes since yesterday’s post.

Euro went shy of few points of the range but made another one high so the up correction could be complete. Or will it need another one high, still between 1,317-1,326

ES already started a bounce, but did not reach 1374 that would signal that the last subwave of the drop is complete. But today’s rise looks impulsive so short term after a little bit of correction there will be more upside. Lower probability that it needs another one low before rising to major resistance at 1385-1391

Silver is exactly like yesterday, so the post is still valid. But it is more likely that today’s low will hold and it will rise to 32-32,5.

Crude bounced hard: is the beginning of the rise to new highs, as i guessed yesterday? I believe it is

Filed under Comments, ES, EuroFx, Oil, Silver

April 10th

April 11, 2012 by mdm Leave a comment

Well, finally we had a strong down day. But the picture at this point is mixed, as euro e metals could need another bounce to complete their structure. For the medium term analysises you could read the previous Easter posts; let’s see how short term could evolve.

Euro: it rose in five clear waves from yesterday’s low, then tested the lows in a 3 waves move. a 5-3 imply another 5 up, so 1,3150 should be surpassed before the next downleg begins.The most likely area is 1,317-1,326, but it will be useful to sport a complete 5 waves move.

ES: clearly it had a strong day with many small “third wave” moments. But what is this decline? the start of a serious downtrend or another correction that will trap the bears? I don’t want to declare the Bear is back until i see a clear 5 down on hourly chart, and you could see there are only 3 waves at the moment. So i’ll leave the 1 or A labeling. Tonight it should put another low to complete the wave 3 or C and the subwave started at 1382. What after that?

If this was a 3, wave 4 should stay under 1386 and – after consolidation – should put another low with 5 down.

If this was an ABC zigzag, well.. this is another dip to buy to return to the highs.

Metals. Still no clues about what will be the next big IT move. So, remain focused on short term, it seems that Silver will rise to complete a zigzag. I still believe the “decision” point will be around 30,5, and it has to go there. Meanwhile, 32,1-32,45 should be the resistance that should provide a reverse to the downside. Gold is a little more confused, so i’ll analyze it tomorrow.

Crude Oil: pattern from the highs is surely corrective. We are right at around the powerful 61,8% retracement. From here, at any moment, i would bet is going to start a skyrocket to new highs. How it fits a rising crude, with a bearish scenario in stocks? Not very well, uh? Who will be right, we’ll see…

Filed under Comments, ES, EuroFx, Oil, Silver

April 3rd

April 4, 2012 by mdm Leave a comment

Euro started the next downleg, that should be powerful and lead it under 1,26. The last support to break for confirming the move is 1,32, that is really near now. While ES is still uncertain (it could have already topped, or it is tracing out a triangle leading to one last high), Metals looks like have completed a correction up and are ready to follow down.

Euro: wave Y fell short of few points, but the reverse in 1,34 area happened anyway. Waiting for a break of 1,32 but it should happen soon

Gold and Silver should break thei lows to confirm the move, but bullish option seems far now unless the bottoms hold (that, for gold, seems unlikely)

I’m waiting to have all macro counts clear, and i think i’ll have in a couple of days or early next week, to post some intermediate term charts. When things are uncertain, is better to focus to small time frames to trade small moves. But we are near, and it will be worth focusing on where we are going.

Have a nice trading tomorrow

Filed under Comments, EuroFx, Gold, Silver

March 29th

March 30, 2012 by mdm Leave a comment

These are 5 waves down on ES or is once again a blunder? There is only one way to confirm: a 3 wave move that ends under the top, and a substantial decline next week. This time they seem clearly impulsive, but.. we’ll see.

Euro doesn’t look impulsive. I’ve never liked to label more than 3 waves with X,Y and so on, but.. seeing a complete wave up and a corrective move down, i’ll stick with this. Probably one more high before turning down, maybe while ES completes the predicted move up.

Talkin about complex corrections, Crude Oil shows a textbook double flat. The first support box was drawn in last CL update: it needed more time, but it is there now. It should hold and start another one impulse up to surpass the highs.

I am not convinced by the corrective nature recent downmove in metals. I do not find strong elements to commit one way or another: primary choice remains that until 31,11 and 1626 hold, another up leg is starting right from these levels.

Have a nice weekend, i will update saturday or sunday.

Filed under Comments, ES, EuroFx, Gold, Oil, Silver

March 28th

March 29, 2012 by mdm Leave a comment

Sorry but i cannot post charts tonight. Just a brief sum up: metals retraced exactly to the area indicated yesterday, so until recent low holds, they are set for at least another impulse up.

Euro breached 1,33 for a while, but the structure is not entirely clear and both options discussed yesterday are still in place until it will go under 1,32 giving confirmation of a trend change.

SPX shows 5 small waves down from the top, while ES doesn’t show a complete structure from yesterday’s high: tomorrow we should see weakness in the globex session and a bounce during regular hours to align both wave counts.

Complete update tomorrow, have a nice day

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March 26th

March 27, 2012 by mdm Leave a comment

Wave C in euro is extending, tracing the first three waves. It needs a consolidation in wave iv and a final push up (probably around 1,34) before turning down

Metals are confirming my recent (at least for the short term) bullish bias. Recent posts are well explantory, and i think last week low will hold for now, maybe for more than a while. Both metals looks like they have traced or almost completed five waves up, so it’s possible that they will correct a bit before continue up. But i won’t bet for a deep retracement rather than a small correction

ES.. well, maybe it just won’t turn. It pushed to another high and it really looks not completed, so expect more upside. Limited or not, it should be seen. The uptrend looks to me too dangerous to be joined now, but it is equally dangerous to anticipate again (my fault) a turn. Revised count of recent action:

Market is QE addicted right now and every downtick is bought with rumors of a new round or – like today – is Bernanke in person to add fuel talking about “accomodative” policies to come (even if he denied just one month ago there would have been new QE). So this is the game: every pause in the rally require a rumor, a hope, a QE talk. And the addicted market, like a obedient dog, buys. There will be an end to this game? We’ll see.

Filed under Comments, ES, EuroFx, Gold, Silver

Weekend update

March 25, 2012 by mdm Leave a comment

Finally, five waves down on SPX. With Euro in the last subdivisions of an ABC correction, next week should show a couple of days of very strong downside. Let’s start with SPX:

To confirm that the trend has changed, we’ll probably see a complete abc correction up in wave 2, that should bring the index around 1400-1403. Then it should accelerate to the downside in wave 3 to break the lower trendline.

Euro completed a wave B correction before starting to rise in wave C. It appears to be in wave iv of C, and this means that the week will start with another push up, probably to 1,332 (where wave C is 0,618x wave A, a common relation) or slightly above. The following decline should lead fast under 1,30 first and then under 1,26.

It’s still early to resolve my previous doubt on metals. But Silver downside appear to be corrective, so as long as thursday low holds, i’ll assume the metal is going to rise above at least 38

Filed under Comments, ES, EuroFx, Silver

March 21st

March 22, 2012 by mdm Leave a comment

Another one interlocutory days, with negative bias in close (while euro reversed in the morning). There is not so much to add from yesterday analysis, because metals are still flirting with their lows and ES didn’t declared its intentions.

I still believe Silver has to test 30,5-31 area (remember, 61,8% of the rise from the december low) and see how it react there. The corresponding area for Gold is 1628: it looks like Gold is developing a trinagle, so a spike down and a reverse should be perfectly permissible.

ES is a little bit choppy for today so here is an update of SPX chart. Backtesting and still closing under the wedge trendline

Euro reached the target area and reversed. While there are not five clear wave down in place, a strong acceleration to the downside is still my primary scenario