Saturday, August 27, 2016

Biotech Update (IBB): Bulls need to act fast

The inability of IBB to break the descending Gann line (light blue) is a significant event pointing to further lower prices, in our opinion.

However bulls still have hopes as long as price stays above 277.90. In case price breaks below 277.90, then the next target (where the line in the sand lies for bulls) is 270.Below this level, bears are in control.

Wednesday, August 24, 2016

US Equities Market: A FED run business

Since the financial crisis back in 2008 many believe that the US equities market is essentially a FED run business.We think that this notion is true.Below you can see the close correlation between the broad US equities market and FED monetary base.

Also we would like to note that every time monetary base formed a plateau the market went sideways.However interestingly market tends to start a prolonged upmove about 6 months BEFORE a significant monetary expansion.
Current monetary plateau lasted about 2 years (on October).Market started to rally since last February which is exactly 6 months ahead of Oct 2016....
We believe that market discounts an expansion of monetary base from October 2016 onwards and therefore a significant rise for stocks...
Happy trading!

Friday, August 19, 2016

Market (SPX) is dangerously approaching stall speed

Good morning.We are getting ever so worried about market internals.Market currently resembles a plane flying at near stall speed.We believe that unless market moves higher with full speed, soon it will succumb to gravity.

Be prepared, a correction ahead is very possible
Support levels: 2140,2080

Thursday, August 18, 2016

Gold: Just the facts mam...

Recently we showed that gold was ready to pause (Gold: About to take a break?) and in fact that is what is happening right now.
Currently gold is consolidating just beneath the upper boundary of multiple resistance levels(horizontal, gann, monthly ichimoku).It looks like it is forming a continuation triangle (a bullish flag which means a move towards 1300 cannot be excluded).Fibo, EW and classic TA studies suggest a target for gold at 1450-1500$ on condition that it manages to break above 1370-1400$

Happy trading!  

Wednesday, August 17, 2016

Utilities (XLU) A cup and handle?

Today we would like to show a very bullish pattern for XLU.
We think that Utilities are gradually forming a Cup and Handle pattern suggesting higher prices in the future.

Happy trading!

Sunday, August 14, 2016

Staples (XLP) buy signal

Last Friday staples ETF (XLP) broke above a ST descending trendline after a breakout off a consolidation and a subsequent confirmation of the breakout.

 We are bullish on XLP and initiate a long position

Wednesday, August 10, 2016

Gold: About to take a break?

About a month ago we noted that "Currently Gold is in a resistance zone (1300-1400) and hitting 1/2 Gann angle from the recent bear market."(Gold in a resistance zone without any signs of weakness).

At that point gold was around 1370, currently gold is at 1350.
As you can clearly see from the previous chart gold is in a resistance zone and on top of that the ichimoku cloud is hanging over gold dangerously(monthly chart, see below) and a Gann resistance angle from the previous 2011-2015 bear market is at current levels(weekly chart see below)

We feel that gold will pause and correct in the near future.How much?A very plausible target is around 1260-1280(or even 1210)
Time will tell.
Happy trading!

Thursday, August 4, 2016

XLE: A huge Inverted Head and Shoulders

Back in May we suggested that "Bulls need to see XLE breaking above 67 (even temporarily) towards the resistance zone of 71-74.In this case the formation of an Inverted Head and Shoulders formation is very possible, leading XLE much higher"(Energy sector (XLE): Make it or Break it!)

As we can clearly see from the following chart XLE since May touched 70+ and then retraced.Also volume recently started to pick up.We stay with our view for a huge Inverted Head and Shoulder formation for XLE and our current preferred pathway is as follows:

Happy trading!

Wednesday, August 3, 2016

Natural Gas in correction mode

Glad to be back after relaxing 2 weeks in a magnificent Greek island!
Natural gas is in a bullish flag.Currently there is significant, multiple(gann, ichimoku, horizontal) support at 2.42-2.5