XAO Technical Analysis

tech/a · 17 November 2010

Re: XAO Analysis

professor_frink said:
What's going on on the US markets that has you worried tech?

There are strong resistance technical setups which have come into play in all the RUSSELL
DJI
and NASDAQ.

With all 3 correlating strongly and the steady decline over the past few sessions-- I feel we may see only corrective up moves in a new down thrust if price falls past old resistance levels (which should act as support).
We have one on the XJO at 4600. Trading below here and it wont be nice.

I'm not happy either with my portfolio profit dissolving 50% this morning.
So 4600 the key here.

sammy84 · 17 November 2010

Re: XAO Analysis

tech/a said:
There are strong resistance technical setups which have come into play in all the RUSSELL
DJI
and NASDAQ.

With all 3 correlating strongly and the steady decline over the past few sessions-- I feel we may see only corrective up moves in a new down thrust if price falls past old resistance levels (which should act as support).
We have one on the XJO at 4600. Trading below here and it wont be nice.

I'm not happy either with my portfolio profit dissolving 50% this morning.
So 4600 the key here.

Fair enough.

Yeah resistance on the majors is noticeable, however, individual stocks patterns are providing less confirmation. Many stocks are holding up which seems to be showing some buying is still around. Still thinking that this is merely consolidation occuring around resistance.

Big fan of seasonality and therefore like to be long in December when the odds are on my side.

Need to see some strength soon though to make me want to enter. 4652 is where I am wrong. I'm not overly long at the moment so don't mind either way.

Don't like this headline in the Fairfax papers however- 'Shares tipped to recover'

professor_frink · 17 November 2010

Re: XAO Analysis

tech/a said:
There are strong resistance technical setups which have come into play in all the RUSSELL
DJI
and NASDAQ.

With all 3 correlating strongly and the steady decline over the past few sessions-- I feel we may see only corrective up moves in a new down thrust if price falls past old resistance levels (which should act as support).
We have one on the XJO at 4600. Trading below here and it wont be nice.

I'm not happy either with my portfolio profit dissolving 50% this morning.
So 4600 the key here.

cheers tech

Don't really follow the russell or dow too closely, but the 1220-1225 on the SPX that I've had highlighted on my charts for a while seems to line up with that general theme fairly well.

Whilst the markets over there have definitely hit a bit of a roadblock for the time being, personally I still favour dip buying right now. Sentiment was definitely getting to historically high levels recently, but I usually look for some kind of deterioration in the breadth/strength of a rally before I start looking for shorts, and so far I really haven't seen enough of that yet to think that there will be much more to the current selloff than we've already seen.

Personally I'd prefer to throw some bids out there at the moment and then see how the action unfolds for the rest of the week.

Could be wrong of course, but that's what stops are for!

Logique · 17 November 2010

Re: XAO Analysis

Gringotts Bank said:
Chart showing the dominant channel with lots of touches on the parallels. A bounce back toward the white line tomorrow wouldn't be out of the question.

Thanks Gringotts that chart puts things into context. Looks like some tech support for the XAO at 4700, if that fails then the all important test of 4600 like Tech said.

I believe in that channel. So bring it on.

tech/a · 17 November 2010

Re: XAO Analysis

Could be wrong of course, but that's what stops are for!

Mine are going off like crackers now!

Whiskers · 17 November 2010

Re: XAO Analysis

I don't want to start a panic sell-off here, but has any of you noticed the Dark Cloud over the weekly chart as well... and stone the crows if that isn't a good start to another more serious Three Black Crows.

I'm with you Sammy, I was expecting or maybe hoping around 4600ish I would start buying again... but I''m only about 60% strong on that scenerio and 40% on a bigger correction.

Edwood · 17 November 2010

Re: XAO Analysis

and while its not a tradeable signal in its own right, don't forget we had a cluster of Hindenberg Omens not so long ago so the markets have been showing signs of underlying stress for a while. just something to be aware of really, not suggesting we're going to tank

tech/a · 18 November 2010

Re: XAO Analysis

So there we have it a small positive retracement (expected today) and tommorow------

Whiskers · 18 November 2010

Re: XAO Analysis

Edwood said:
and while its not a tradeable signal in its own right, don't forget we had a cluster of Hindenberg Omens not so long ago so the markets have been showing signs of underlying stress for a while. just something to be aware of really, not suggesting we're going to tank

I think you're quite right there Edwood. I think too often we get too obsessed with looking for 'tradable signals' and systems that we loose sight of the macro 'signs'.

Probably a good time to elaborate on my earlier 'sign'.

It started with the Dark Cloud. Then the Three Black Crows... then the Pennant... in isolation, not too fantastic, but when they all overlap, ie shares a common candle with each other, collectively they gain more significance.

Then the same pattern starting to repeat in the weekly...

Now for the candle stick critics, candles as with bars or P&F or any other chart, simply reflects price action over time as you would surely have heard others explain in detail at times. The key is understanding the pattern... price action = chart pattern.

For the doubters of chart analysis, the expression 'all things being equal' or equilibruim, must never be forgotten... and one thing that has not been equal is Stimulus and again recently is the US QE bonk*.

An example in the last big bull was the amount of money flowing into the Aus market from changes to superannuation rules for example that pumped our market ahead of the pack.

tech/a said:
So there we have it a small positive retracement (expected today) and tommorow------

Good question tech.

The AUDUSD weekly is an interesting sign for me. , look at where the Dark Clouds are in the context of 'Ã¡ll things being equal' or not, money flow, price action and how to interpret the image or chart of that action.

Similar clues in the EURUSD and XAUUSD reinforced my top call... but the key for me as to the degree of the correction is the rate at which the USD increases and the POG and commodities come off the bonk*.

From an EW perspective my 40% concern is that the QE bonk* may have shaped the start of a larger degree expanded flat pattern correction... a (normal) correction starts, the price action rebounds extraordinarly for some reason like a QE or unexpected interest rate move, before the forces bonk* and launches it back to and probably past equilibruim.

* Hitting the wall, a condition in endurance sports where depletion of glycogen stores results in sudden and severe fatigue

professor_frink · 18 November 2010

Re: XAO Analysis

Whiskers said:
I think you're quite right there Edwood. I think too often we get too obsessed with looking for 'tradable signals' and systems that we loose sight of the macro 'signs'.

Probably a good time to elaborate on my earlier 'sign'.

It started with the Dark Cloud. Then the Three Black Crows... then the Pennant... in isolation, not too fantastic, but when they all overlap, ie shares a common candle with each other, collectively they gain more significance.

Then the same pattern starting to repeat in the weekly...

Now for the candle stick critics, candles as with bars or P&F or any other chart, simply reflects price action over time as you would surely have heard others explain in detail at times. The key is understanding the pattern... price action = chart pattern.

For the doubters of chart analysis, the expression 'all things being equal' or equilibruim, must never be forgotten... and one thing that has not been equal is Stimulus and again recently is the US QE bonk*.

An example in the last big bull was the amount of money flowing into the Aus market from changes to superannuation rules for example that pumped our market ahead of the pack.

Good question tech.

The AUDUSD weekly is an interesting sign for me. , look at where the Dark Clouds are in the context of 'Ã¡ll things being equal' or not, money flow, price action and how to interpret the image or chart of that action.

Similar clues in the EURUSD and XAUUSD reinforced my top call... but the key for me as to the degree of the correction is the rate at which the USD increases and the POG and commodities come off the bonk*.

From an EW perspective my 40% concern is that the QE bonk* may have shaped the start of a larger degree expanded flat pattern correction... a (normal) correction starts, the price action rebounds extraordinarly for some reason like a QE or unexpected interest rate move, before the forces bonk* and launches it back to and probably past equilibruim.

* Hitting the wall, a condition in endurance sports where depletion of glycogen stores results in sudden and severe fatigue

So is it a significant top your calling now whiskers??

Broadway · 18 November 2010

Re: XAO Analysis

Commodities might be hitting some volume.

dbb,bdd,iym,jjm are general commodity etfs.
Next 4 are gold etfs.
HG is copper.
uso and uco are oil etfs.

tech/a · 19 November 2010

Re: XAO Analysis

Good question tech.

Appears to have been answered.
Would have surprised many!

Whiskers · 22 November 2010

Re: XAO Analysis

professor_frink said:
So is it a significant top your calling now whiskers??

That's the $64 question.

Broadway said:
Commodities might be hitting some volume.

dbb,bdd,iym,jjm are general commodity etfs.
Next 4 are gold etfs.
HG is copper.
uso and uco are oil etfs.

I have no doubt the answer is in commodoties, ie our XMM index.

On face value it's cause for serious concern, especially if history repeats itself.

I expect the bigger picture will be clearer in a week or two... but I still favor it having another go at 4,660 ish in the next few days. I think it's significant that this rebound hasn't broke back above 4,667 (at least so far) which was support before it broke lower.

Whiskers · 22 November 2010

Re: XAO Analysis

A few posts back I mentioned a clue to the markets next big move may be in the USDJPY breaking out of down trend and particularly the case that the USD has bottomed, as has been supported by the (proper) Three Black Crows on the EURUSD, Dark Cloud's on the AUDUSD and the POG.

But what this chart does show is the opposite of the Dark Cloud, a Piercing Line bullish signal and in this case followed by and overlapping with Three White Soldiers... the Proper application of 'that' configuration that what's-his-name kept calling Three Black Crows wherever they appeared.

So, what is clear is the USD has bottomed and commodoties (generally) have topped out.

I reckon the net effect on the stock market cycle will be determined by how quickly and smoothly equilibruim of the USD pans out.

Whiskers · 22 November 2010

Re: XAO Analysis

Whiskers said:
That's the $64 question.

I have no doubt the answer is in commodoties, ie our XMM index.

On face value it's cause for serious concern, especially if history repeats itself.

I expect the bigger picture will be clearer in a week or two... but I still favor it having another go at 4,660 ish in the next few days. I think it's significant that this rebound hasn't broke back above 4,667 (at least so far) which was support before it broke lower.

Ooops... obviously should have been 4,767.

professor_frink · 22 November 2010

Re: XAO Analysis

Whiskers said:
A few posts back I mentioned a clue to the markets next big move may be in the USDJPY breaking out of down trend and particularly the case that the USD has bottomed, as has been supported by the (proper) Three Black Crows on the EURUSD, Dark Cloud's on the AUDUSD and the POG.

But what this chart does show is the opposite of the Dark Cloud, a Piercing Line bullish signal and in this case followed by and overlapping with Three White Soldiers... the Proper application of 'that' configuration that what's-his-name kept calling Three Black Crows wherever they appeared.

So, what is clear is the USD has bottomed and commodoties (generally) have topped out.

I reckon the net effect on the stock market cycle will be determined by how quickly and smoothly equilibruim of the USD pans out.

In regards to weekly candle formations, have you looked at the DX from last week? Might be worth looking into

Whiskers · 22 November 2010

Re: XAO Analysis

professor_frink said:
In regards to weekly candle formations, have you looked at the DX from last week? Might be worth looking into

Yeah... interesting you should mention that.

There are quite a lot of candle formations in there,(weekly chart) but I have highlighted yellow the significant Engulfing Bullish formations on the USDX and a corresponding Engulfing Bearinh on the EURUSD where 'D' ought to have been. I have drawn the 'B', 'D' line on the USDX where I reckon it ought have been, but for 'market manipulation'. Note we also have the Three Black Crows on the EUR USD daily chart at 'D'.

I suppose the standard belief is that the USD will fall eventually as a measure of it's real worth. But my theory or notion is the USA has been hell bent on artifically lowering the USD in an attempt to cure their short term 'Ãll health' a pep pill... but they will eventually get their wish when the right reason becoms the mass consciousness, although when it finally comes in due course, they may wish it hadn't, realising the longer term harm it causes or at least reflects in the (mis)management of their economy.

How all that theory/notion will affect the Aus commodity driven economy over the longer term... throw in a Mining tax again a bit down the track and...

ginar · 23 November 2010

Re: XAO Analysis

key point in price here re XJO at 4600 level , has been support for >2 months . after being resistance since early may , definate line in the sand . the trend on 2 hourly is down but im keeping a close eye support level on daily . daily does look a little messy but 2 hour looks pretty neat . on 2 hour we have 4675 as reference above with 4600 below which being tested as i type , i also do plot last night out of hours low on cash as a level to watch . we cant break 5day50 currently so the bias is down . new 5 day lows keep being made . next few days make or break . today i need to see close above 4651 to be even remotely bullish , looks unlikely . fwiw the 5dayhighs will be at 4675 area by weeks end assuming we dont break above ... price action is king , time for caution whatever your bias . fwiw i trade the xjo/200/spi so im not at all interested in any of the usdx copper etc charts out there , only time i look at those is if a trade em . its all static otherwise . i suppose i should really post on spi threads .

.......... trade well

Gringotts Bank · 23 November 2010

Re: XAO Analysis

update. A sharp bounce off the orange line looking imminent - tomorrow or day after? Followed by a snail's pace push back up to 4750?

tech/a · 23 November 2010

Re: XAO Analysis

tech/a said:
Appears to have been answered.
Would have surprised many!

All going to plan from what I can see.

XAO Technical Analysis

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