Update Phien Au
GOLD sell 1668,stoploss 1672, tp 10$
@gbpusd buy 1,577x, Stop 5735, tp 582x
Technical Analysis 28.8
EUR/USD
The pair attempted to rally during the Monday session, but fell in order to form a shooting star that is sitting just at the 1.25 handle. Looking at this chart, it does in fact look like the downward pressure is set to continue, and there is an uptrend line that should meet up with this market at about 1.24 or so. It is at that area that we think we could see a real fight. However, one certainly cannot argue with the idea that the Euro is in a downtrend overall, and as such selling is certainly the direction we want to be trading.
We still think that eventually this pair goes down to the 1.15 level, and as such we are more than willing to sell on a break of the Monday lows. As for buying this market, we simply will not do it as the resistance looks pretty noisy all the way up to the 1.27 handle
GBP/USD
The pair attempted to rally during the Monday session, but fell off an d managed to break down well below the 1.58 level. This is a very bearish sign as the day is closing out the session forming a shooting star, and now we have to pay serious attention to the 1.57 level if this level gives way, this would become a false breakout of a massive triangle – which is a massively bearish sign.
We still see no reason to panic at this point in time, as this is more than likely just going to be a pullback. On a supportive candle between here and the 1.57 level, we are very comfortable going long. Again though, if we get a daily close sub 1.57, this could be a market that would be worth selling.
Crude Oil
The light sweet crude market had a negative session on Monday, albeit a wild one. The market currently sits above the $95 level which looks very supportive, but underneath the $100 level which looks very resistive. Even more granular of a look at this market suggests that the $98 level could become resistance as well. This is simply a confused looking market, and the candlestick itself is negative, but there are long wicks in both directions.
Because of this, we are actually choosing to stay flat of this market and believe that as long as the hurricane is a threat in the Gulf of Mexico, refiners and the whole flow of crude oil in North America could throw a monkey wrench in the way that a lot of these markets get traded. Granted, the real trouble is going to be in the gasoline markets, but there will be not, fax to the crude oil markets as well. Because of this, we choose not to trade or even “bet” on what the weather will do.
Also, there is wide speculation that the US government will release the Strategic Petroleum Reserves in order to try and combat a spike in crude oil prices. This is part of what has been keeping a lid on this rally. However, there is little to suggest that crude oil is hard to be found. In fact, we can be said that we are oversupplied of it at the moment, and at this point in time we really need to see gasoline inventories rise more than anything else. Adding to all of the confusion is the fact that the world’s second largest oil refinery is currently on fire in Venezuela.
Looking forward, we think that the market will also be watching the speech by Federal Reserve Chairman Ben Bernanke on Friday for hands of quantitative easing. If there is no hint of quantitative easing, the US dollar should get a bid and this could bring prices down in this marketplace. Conversely, if he does suggest that quantitative easing is on the way, we could get a spike in oil prices overall. Because of this, we think that the next few days will be very difficult trading this market, and may actually choose to stay flat until late Friday.
Dow Jones
The Dow Jones Industrial Average fell slightly during the Monday session, in an otherwise very quiet marketplace. In fact, we only ended up down about 30 points. Because of this, this day almost looks like a simple break in the action, and not much to be read into the results. The 13,000 level below still looks rather supportive, and as such we are looking for supportive action close to that level in order to buy blue-chip industrials.
As for going long of the futures market, we aren’t as keen to that as there will be quite a bit of noise over the next couple hundred points. Once we get above the 13,300 area though, it does look like we are going to break much higher.