Despite my medium term pessimism on the stock/commodities market, I think we are poised to the last push higher. Check out the charts below.
This is a classical Wyckoff schematics in the making. See that “spring”? There is a good chance Gold is going to test 1023-1025 area today, which also means another leg down for USD and a test of yesterday’s highs by S&P 500.
If you want to find out more about Wyckoff formation, check out this link. Stay tuned for more updates.
Selling another 1/4 of my initial position according to plan at 107.20 (check out my previous post). This makes my average price for the position – 106.50.
As I have mentioned in my post on 7th of September, I will be looking to re-short, if we get to the 1050 in SPX. And today we eventually did.
As seen from the chart above, we have got the price facing the upper trend lines, which are acting as a resistance for the time being. Due to the current strength and the common believe that the worst is other (check the Bernanke’s speech) I am getting more cautious in my projections and short trades.
I am looking to position trade this top. Here is how I am going to enter into the trade:
Right now, I have entered 1/4 of my initial position in SPY at 105.80. I will continue adding 1/4 for every 1$ the index rises with my last purchase at 108.80 (if we get there ofcourse). In this case, my average cost would be 107.30 and my ultimate stop will be at 110.30. If, on the other hand the market reverser at some point, I’ll be looking to enter at retracement levels.
As the market will be closed for a Labor Day today, here is what to expect on Tuesday.
Right now we are at a pretty critical point. Every 10 pts. rise or drop might determine the market direction for the coming weeks.
From the chart above, you can see a potential Head & Shoulder forming and 1020 is a critical point here. If that resistance holds, we have a good chances hitting 960. If not, I would be looking for 1050.
I personally tend to believe that we are going lower, the only thing that worries me is a MACD, which is indicates more upside to come. So, here is how I’m gonna play it:
So, here is how my intraday trade looks like (chack out the previous post).
That was a really quick rice from the support area at 1004-1006. Next tough area to take out is 1017-1018. It is a classical support-turned-resistance situation. If the resistance holds, then we will be looking at Inverted Head & Shoulders pattern with the price target at 950-960.
I don’t wont to be a hero here, so when we get to the 1016-1018, I will close my longs.
We have formed a double bottom on 5 min. chart. Looking for a buy here at SPX 1005-1007.
Stop 7 pts. Target 1015-1017. Will hold till day’s close.
If we fall below 998 – will reverse to shorts.
Sell SPY at 102.70-102.80. Stop loss 0.50$. Target 101.00 by today’s close or tomorrow morning.
Due to the current rise in OIL and GOLD emerging markets are on the move again. Some of them were hit pretty badly in the beginning of last year and most of them were heavily undervalued. With the coming upward move among all asset classes, emerging markets are going to be one of the top winners.
I would suggest to buy here with the target at 30.00-32.00. That’s more that a 30% return on your investment.
By buying Sep@25.00 Calls for $0.90 right now, you can get a 500%-700% return in ONLY ONE MONTH. Please be advised though, that options are risky instruments for a novice trader, so I would suggest to read more about them. One of the best sources to learn options trading is MarketWatch. Click to get your Free 30 Day Trial of MarketWatch’s Proactive Options Trader Newsletter.
Gold is ready for a big breakout. The target by year end is 1150-1200$. It may sound a little bit too optimistic and premature, but charts don’t lie.
Right now we are stuck in a huge symmetrical triangle. Triangle are continuation patterns and as you know, the bigger the bigger the pattern the more violent would be the move. There is a really strong resistance at 1000-1050 level. Just imagine if this level is taken out and all the stop orders above are hit. That would be one heck of a rally.
My suggestion is to start accumulate GOLD right now as a more longer term investment. Start accumulating in 1/5 portions (every buy is 1/5 of your maximum position). Place stops at ~940 level. Add another position, as we trade through 950-960$.
Considering this is a long term position, you may also try selling Call Options to earn additional money from premium. Use your free trial option to find out more about this strategy. Click to claim your Free 30 Day Trial of MarketWatch’s Proactive Fund Investor Newsletter.
Even though the market looks toppish right now and everyone expects it to fall, the history shows that the market does what no one is expecting. I believe this is the case with the stocks in the coming weeks. Even though, we have rallied quite significantly from the 870-880 area (see my previous post) there is more room to go. Only this time, the main driving force will consist of crowd buyers. short sellers who urge to cover and some bogus positive news. that will fuel this rally. But what do we care? We are here to make money. so just follow the trend!
After a possible pullback to 930-940 (if we get there) I believe we are going to 960-970. If we get this pullback. I would advice to buy heavily. Though, I highly doubt we will. The only pullback we might get, would be 5 pts. max during night session and then the rally continues.
NASDAQ looks much more overbought, so we might see 20-30 points pullback here. if you are already long, there is really no need to do anything but wait.
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