Here is one I suggested 2 nights ago. It activated yesterday...
BOTTOM LINE
10/9:
EW Trend: Up (?)
Price Trend: Down
Trend Strength: Weak
Broker Consensus: Intermediate BUY
10/8:
EW Trend: Corrective
Price Trend: Down
Trend Strength: Weak
Broker Consensus: Intermediate BUY
LAYMANS ANALYSIS
10/9:
VIDEO ANALYSIS (2 mins 40 secs)
Prices have drifted lower off the intermediate highs that followed the sell off. The last review suggested that we could see $25.75 and that's exactly what we got, to the cent. There is one very notable pattern on this chart that offers up some very specific information and that is the price and volume activity on that major low mid last month. You can clearly see that this was panic selling because quite frankly there is no other way prices could move that distance in such a brief time. However, the conclusion we need to take away here is that the panic selling was met by buyers equal and stronger than that selling. The close of that specific session was well off the lows and the volume was ultra high. We need to think result and effort. High volume means a lot of effort. A lot of transactions. The result was a high close. So if we have a lot of effort and a high close we must objectively consider that demand, that is buyers, overwhelmed the panicked sellers. This background information offers no ambiguity. Its clearly bullish information. An aggressive buyer looking for a low risk/high reward trade could buy on a breach of today's high of $28.31 and place a protective stop at $27.95. This is what I will suggest for the Elliott Wave portfolio. A more passive trader could look to buy on penetration of $29.30 to allow inertia carry their position higher. If this analysis is correct, we should expect to see $32.00 again as a minimum.
10/8:
VIDEO ANALYSIS (2 mins 13 secs)
Prices managed to push higher and funnily enough filled the gap before starting it course lower again. Patterns repeat time and again. Notice how the volume over the last week has been low? A low volume advance suggests "no demand" and today, with prices turning lower again, we have an increase in volume once again. There is now a good chance that we'll see prices start to move lower again now, but we must be careful of the background strength seen earlier this month. There was quite distinctive demand showing and we must assume it will reappear on another test. From a theoretical perspective we could continue to trade lower to $26.00 and if the broad global contagion persists especially with lending practices under close scrutiny we may well see it happen. An aggressive trader could look at short position on further weakness, but any signs of demand entering at those recent lows would be a signal to take defensive action.
TECHNICAL DISCUSSION
10/9:
The larger pattern unfolded in a 3-wave move and culminated in a clear blow-off low and thrust back just as quick. This is impulsive activity and seeing as its been followed by a smaller 3-wave decline would should expect that we've now witnessed a wave-ii or -b low. The minimum upside target is $32.06 with further gains possible if the broader market can shake off its blues. The wave equality of this most recent 3-wave move is almost exact in both time and price. Wave-c extended 3c further but both waves took 3-days apiece to complete. The depth of the retracement is a little shy of what is normally expected just missing out on tagging the 50.0% level. Today's weakness also partially filled a gap left on the way higher. A hit of the 50.0% retracement level would have closed that gap perfectly. Today saw prices gap lower, close on the highs and did so on respectable volume and against the broader market's weakness. I think the combination of this plus the wave equality and the background strength of the blow off low offers a good opportunity.
10/8:
A nice gap fill to terminate wave-iv. Also of note is that yesterdays rejection coincided with the lower side of the old consolidation. Another example of old support becoming new resistance. We should no start to trade lower into the wave-v. Normally I'd be tempted to go short but with the background strength and the possibility of bullish divergence developing in the broader market I am a little hesitant. That said, I guess if any sector is going to come under pressure from the current global woes it will be the banks. Less so the Big-4, but they'll still feel the heat. If the lows are breached and the wave-v extends fully the target is $25.75.
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