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Welcome and thank you for visiting!

The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...
please read my full Disclaimer at this link.

Dots

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Events

UPCOMING (MAJOR) ECONOMIC EVENTS...
* Fri. Oct. 6 @ 8:30 am ET ~ Employment Data
* Wed. Oct. 11 @ 2:00 pm ET ~ FOMC Meeting Minutes
* Wed. Oct. 18 @ 2:00 pm ET ~ Beige Book Report
* Tues. Oct. 31 ~ 2-day FOMC Meeting Begins
* Wed. Nov. 1 @ 2:00 pm ET ~ FOMC Announcement
* Tues. Dec. 12 ~ 2-day FOMC Meeting Begins
* Wed. Dec. 13 @ 2:00 pm ET ~ FOMC Announcement + FOMC Forecasts + @ 2:30 pm ET ~ Fed Chair Press Conference
*** Click here for link to Economic Calendars for all upcoming events

Sunday, September 24, 2017

German, Euro and Emerging Market Headwinds

As early polling results on Sunday show that, although Chancellor Angela Merkel has been elected for a fourth term, her party has lost ground to the far right, and a coalition government will need to be formed amid much discussion over, what could take, months.



The German DAX Index is near long-term uptrend resistance, as shown on the following Monthly chart, so support may taper off during Q4 of 2017, as Q3 ends this week, and investors mull over their next moves in Europe and in other world indices.


The EURO is at long-term price resistance, as it faces a great deal of overhead supply above 1.1900, as shown on the following Monthly EUR:USD Forex chart.


Conversely, the US Dollar is sitting above long-term major support at 90.00, as shown on the following Monthly chart.


The following Monthly chart of the Emerging Markets ETF (EEM) shows that the 2-year rally has now hit long-term major price resistance around the 45.00 level.



The DAX:SPX ratio shows that price is caught in between the 50 and 200-day moving averages, near-term price support (5.00) and resistance (5.10), and the 40 and 50% Fib retracements levels, as shown on the following Daily ratio chart. It also faces a great deal of overhead supply resistance above its current price.


The following Monthly chart of the SPX shows that price has further to run before running into long-term uptrend resistance.


Whether we see continued investor support for the SPX, as well as a possible turnaround in the US Dollar, versus a rotation out of the DAX and the EURO, may depend on:
  • signals that we see from both the Fed and the ECB during Q4 regarding inflation and economic data
  • Ms. Merkel's progress in forming a coalition government
  • potential trade headwinds with the EU from the (unpredictable) Trump administration
  • political instability in Asia (North Korea)

Furthermore, if buyers take hefty profits in EEM this week, they may favour putting their money into the U.S. equity markets.

Watch to see if momentum and rate of change pick up in the SPX and the US Dollar and, alternatively, decline in the DAXEURO, and EEM over the coming days/weeks.

Friday, September 22, 2017

USD/JPY Mired in a 31-Year Congestion Zone

The USD/JPY Forex pair is mired in a 31-year sideways congestion zone, as shown on the following Monthly chart.

Major resistance and support are formed by a long-term 40% Fib retracement level at 124.34 and 23.6%  level at 105.69, respectively. The momentum and rate of change technical indicators have been in downtrend since mid-2013.

Until we see a clear breakout above or breakdown below one of those Fib levels, the Yen will likely continue to be subject to volatile, non-directional whipsaw price action in between them.


Thursday, September 21, 2017

Shanghai Index in Weak Rally as China's Credit Rating Downgraded to A+

The Shanghai Index has recently begun to rally, after remaining in a large sideways congestion zone since mid-2015, as shown on the following Daily chart.

It's currently trading under the bullish influence of a moving average Golden Cross formation, with the RSI, MACD and PMO technical indicators making a corresponding higher swing high. However, the MACD and PMO have recently made a bearish crossover "SELL" signal...if the RSI drops and holds below the 50 level, we may see price drop and retest near-term support at 3250, or fall to, potentially 3000, or lower.


According to the Weekly chart below, longer-term support sits around the 23.6% Fib retracement level of 3237 and 40% Fib retracement resistance is at 3608, but, this index faces longer-term major price resistance at 3500 before that level.

Momentum and rate of change have been flat on this longer term time frame, so I'm unconvinced of a sustainable bullish bias...instead, we may see further volatile price swings until direction becomes clearer on this index.


Furthermore, any strength (that may have been contemplated by foreign investors) may now be in jeopardy, as Standard & Poor's downgraded China's credit rating to A+ from AA- today.


Added to that volatility headwind, are new sanctions issued today (Thursday) by China's Central Bank and the United States in regard to North Korea.



Pacific Ring of Fire Earthquakes...Who's to Blame?

* See UPDATE below...

I wonder if the missiles that Kim Jong-un is busy recklessly firing into the Pacific Ocean, as well as his underground massive nuclear explosive tests, are contributing to the large-scale earthquakes in the Pacific Ring of Fire that we're seeing of late...think about it...

Sept. 21...Significant Earthquakes during the past 30 days

* UPDATE Sept. 22...

And, now this...NOKO is threatening to detonate a nuclear bomb over/on/in the Pacific Ocean. What about the effects of shock waves on earthquake fault lines, not to mention massive radiation fallout that would likely spread world-wide?

When are world leaders going to wake up, smell the coffee, and take responsible action that would put an end, once and for all, to such senseless, preventable and willful large-scale human destruction?

THIS MUST STOP!



Tuesday, September 19, 2017

Mexico City Shaken in 7.1 Earthquake as Tepid Rally in Mexican Index Hangs in Jeopardy

Notwithstanding a rally in the Mexican Bolsa IPC Stock Index since it broke above a large, lengthy consolidation zone in mid-2016, only to retest that break at the end of the year, then rise (tepidly) to is current price of 50,265, the momentum and rate of change technical indicators have been flat since January 2013, as shown on the following Monthly chart.

The Weekly chart below also shows renewed weakening momentum and rate of change since the beginning of 2016, in spite of this attempted rally breakout.

Near-term major support sits at 45,000...medium-term at 40,000...and longer-term support at 30,000. These are important levels in the face of a new 7.1 major earthquake that struck today near Mexico City, as reported below (the death toll continues to mount as the day wears on), especially since the rally above its congestion zone has been weak.






I wonder if the missiles that Kim Jong-un is busy recklessly firing into the Pacific Ocean, as well as his underground massive nuclear explosive tests, are contributing to the large-scale earthquakes in the Pacific Ring of Fire that we're seeing of late...think about it...

Sept. 21...Significant Earthquakes during the past 30 days

Monday, September 18, 2017

HRC...Political "Nag"

Presented without comment...











Presidential debate moderator, Chris Wallace, failed to also ask HRC this question...BIG mistake...


Sunday, September 17, 2017

World Markets Nearing Exhaustion?

I last wrote about the World Market Index on August 30.

Since then, price did retest (and break above) the 1950 major resistance level to make a new three-year high, as shown on the Daily chart below. It closed just above that level on Friday.

Notwithstanding this year's push higher (once it broke above above the prior year's congestion zone), the RSI, MACD, and PMO technical indicators have failed to make a series of higher swing highs since mid-May...suggesting that market enthusiasm is waning in world markets, in general.


From the following Year-to-date percentages gained/lost graphs, you can see, at a glance, which major world markets are leading and which are lagging.

Of particular note, in terms of weakness, so far this year, Canada, London, Australia, Japan, Ireland, Russia, China, and the U.S. Russell 2000 Index lead the pack.

We'll see if those laggards begin to gain support soon, and whether the leaders continue to make gains to, ultimately, cause higher swing highs on the above-referenced technical indicators, if we see a retest of the next resistance level of 2000 on the World Market Index. If so, we may see world markets gain strength to push even higher to new five-year highs.

No doubt, world traders will be interested in the Fed's economic forecast and the Chair press conference following this Wednesday's interest rate decision, along with the results of their subsequent meetings in November and December...so, we'll see whether world markets react significantly, one way or other, this week, or not.





Risk-on Back in the U.S. Markets

I last wrote about the percentage of stocks above a variety of moving averages in my post of September 8.

In the week since, buyers scooped up stocks in all the Major Indices, leaving only one minor group in the "below-50% category," as shown on the following tables.




We'll see if this recent risk-on appetite continues in the near term, and whether the Russell 2000 and Transports stocks can break out to new highs for the year.



Cyclicals, Energy, Consumer Staples, and Financials are lagging among the 9 Major Sectors, as shown on the following Daily charts, Year-to-date percentages gained/lost graph, and table.




British Pound: A Sign of Brexit Strength?

The GBP/USD Forex pair has rallied to the underside of major price resistance, as shown on the Monthly chart below.

Watch for a breakout (and hold) above the current level, accompanied by a continued rise in the Momentum and Rate-of-change indicators, to confirm that a further rally is sustainable in the face of ongoing Brexit negotiations.


Tuesday, September 12, 2017

Technology and Healthcare are the Big Winners of 2017

It's all about the Technology and Healthcare sectors this year, in terms of gains made, so far, as shown on the following 1-year charts and year-to-date graphs of the Major Indices and 9 Major Sectors.

The laggard, Energy, may be poised for a recovery, if it can hold above its downtrending 50-day moving average.

The Materials sector is on the verge of new breakout. Keep an eye on GOLD and Gold Miners ETF, as I've recently described here and here.

The Russell 2000 Index is still mired in a large-scale sideways consolidation zone. Watch for any breakout (and sustained hold) above this zone as a potential signal of renewed and serious riskier asset-buying in the markets, in general.

Traders may be influenced by the upcoming interest rate decision and press conference by the Fed on September 20, so these indices and ETFs may drift until then. If the Fed hikes rates, watch for any renewed and serious buying in the Financial sector (see my latest article on XLF here), as well as a sustained breakout and hold above its 50-day moving average and large sideways consolidation zone. And, furthermore, just a final comment on currencies in this regard...watch for any renewed buying in the U.S. Dollar, which has been battered this year, leading up to and following the Fed meeting, in anticipation, potentially, of a rate hike...we may see it retest the 50-day moving average before it, either, renews its downtrend, or continues a rally.