Your latest trade based on T/A

[nomore4s]

Wavepicker/Nick/Anyone

Is this a valid 3 wave decline? Don't use EW in my trading currently but am always looking to learn.

Will post further analysis in the next post, with more charts.

 

[nomore4s]

As per post above, this is a trade I'm currently looking at, haven't entered as yet.

Looks to be very good support at the $13.15 level with both the horizontal support and the long term trendline (about 3 years) meeting at the latest low at $13.21 on 18/09. Support on the weekly chart is also very strong.

There are 2 ways I'm looking at playing this, 1 is a shorter term more aggressive trade with entry at a close above $13.90 and a stop at $13.50 but a better stop would probably be at below long term support at $13.15, just blows the risk reward out a bit, target for this trade would be to resistance at around $15.00 - $15.20.
The 2nd option would be a longer term trade off the weekly chart with entry with a break through $14.00 and the stop at $13.15, target would be around $16.50ish.

 

[rnr]

Help needed please!!

Would those members that adopt EW theory in the conduct of their Technical Analysis please spare a few minutes of their time to help me out?

One of the mechanical systems that I currently trade is a reversion system which has resulted in SLX (Silex Systems) coming up on my radar screen for a possible trade on Tuesday (2nd Oct).

Whilst I have been following the various posts made on ASF that cover this topic I must say that I am struggling to the max to come to grips with wave counts and the interpretation or effect of differing levels of volume.

Today the SP has retraced 61.8% from its August low – September high.

I would greatly appreciate your thoughts, opinions or analysis on the current wave count and etcetera for SLX and also acknowledge that anything posted is only an opinion and I will seek further advice as required.

Thanks in advance,
rnr

 

[wavepicker]

Wavepicker/Nick/Anyone

Is this a valid 3 wave decline? Don't use EW in my trading currently but am always looking to learn.

Will post further analysis in the next post, with more charts.

Count looks good nomore4, but there is more than one way to count this as well. ie a continued more complex correction or a series of sundividing 1-2,1-2,1-2 wave structures. That is why confirmation using other methods is important. Volome in particular does not seem to be conforming a solid upmove at present. Would be at least waiting for a higher low here as some type of confirmation before jumping in and also keeping tight stops at previous swing low in case it doesn't.


PS I like to trade EW setups where more than one type of count point to the same conclusion ie at least for the short to
medium term


RNR

At a quick glance SLX looks like it might head lower, will post a chart later in the day. We had 5 waves down from July peak and now 3 waves up with a continuation of the trend down. Three waves always unfold against the one larger trend, in this case the one larger is down. The only exception to this would be that if it found support here and the upward rally becomes a more complex affair but will more than likely be fully retraced when finished.



Cheers

 

[Nick Radge]

rnr,
If you're trading a mechanical system, then leave the EW and discretionary element out of it.

 

[rnr]

Hi wavepicker,

Thanks for taking the time to respond to my request and your offer to post a chart later in the day would help make it a whole lot easier to visualise and understand your assessment.

Regards,
rnr

 

[rnr]

Hi Nick,

Thanks for your comments and although I understand that if I'm trading a mechanical system there can be no allowance for discretion and consequently EW should not be a consideration as it relies on interpretation.

Every now & then when a security appears on the radar I look back, using the MetaStock Expert Function, to see how this share has performed previously using this system.

Whilst reviewing SLX I applied the Fibonacci Retracement to the chart and noticed that the SP was at a level of 61.8% which I believed, from reading the various posts on ASF, to be a significant result!
Hence the reason for my question and I am eagerly awaiting wavepickers chart post before I look at the SLX movement for the day.

Regards,
rnr

 

[Boggo]

Giday rnr

This is from MTPredictor, I haven't done any news/volume etc research on this, just posting the chart.
The stop is a long way from the entry, some R/R calcs required.

 

[wavepicker]

Hi wavepicker,

Thanks for taking the time to respond to my request and your offer to post a chart later in the day would help make it a whole lot easier to visualise and understand your assessment.

Regards,
rnr

Hello rnr,

This this is a difficult pattern to make a clear cut EW count on. It's very corrective in nature and there are multiple wave counts implying different possibilities. I have labelled chart with the count and pattern which I think best describes the situation. Near term there appears slightly higher probabilty that prices may move higher due to a cycle point high due in late October to mid November. As such this may move higher before continuing bearishly or at least re testing the lows later on. This is a the problem with very complex corrective patterns

As there are quite a few possibilities with this I personally would consider trading it, I prefer to stick to the simple 5's and 3's but that is just me

 

[It's Snake Pliskin]

Hi Wave,

Would you say the volume level is high enough for EW practice? It is consistantly under 1 million SLX. Does the lighter volume reduce the efficacy to some extent?

 

[wavepicker]

Hi Wave,

Would you say the volume level is high enough for EW practice? It is consistantly under 1 million SLX. Does the lighter volume reduce the efficacy to some extent?

Absolutely Snake.

I tend to use EW more so in Indices, Commodiities and Currencies where you have better chance of seeing textbook patterns.

Although on occasion I take trades based on EW with the more liquid stocks when the high probability patterns present themselves, generally I use other methods to help quantify the EW analysis when there appear to be ambiguities

Cheers

 

[It's Snake Pliskin]

Absolutely Snake.

I tend to use EW more so in Indices, Commodiities and Currencies where you have better chance of seeing textbook patterns.

Although on occasion I take trades based on EW with the more liquid stocks when the high probability patterns present themselves, generally I use other methods to help quantify the EW analysis when there appear to be ambiguities

Cheers

Thanks for that Wave.
Are those higher probability patterns statistically validated if at all able to be tested?

 

[happytrader]

Entered AWC this arvo because it looks like it has support at $7.00 and I like the weekly setup. Naturally I feel its cheap enough to take a punt on. I'm happy to exit at or close to $7.50

Cheers
Happytrader

 

[Nick Radge]

Long a few MFS...

 

[wavepicker]

Decided to short the XJO last night.

Have placed a stop at 6744.

Reasoning behind trade: We had a 3 wave structure down from the 16th July to 17th August. We have had another 3 wave advance so far from the 17th August low. This may be an irregular flat correction in progress from the 16th of July that is incomplete. If this is the case then we need another impulse to at least re test the lows(17th August) perhaps go further.

Sentiment at present in the market can be described as hyper bullish, so this is well worth a go IMO.

Current price action also coincides with an important cycle point high on the 5th October plus or minus one day(market is also 34 fibonacci trading days up from Aug 17 low), so this this could continue till Monday bullishly within our time window. The next important cycle point is 14/15th November.(Not sure whether this will mark a high or a low- hoping for a low!!)

Trade Contingencies: If the pattern of trend is showing a struggle down that appears corrective instead of impulse, this maybe simply a second degree countertrend(These usually last 11-14 days) instead of a developing impulse.

As such if this is the case all bets are off! The market will most likely continue bullishly till the next major trend change window in mid to late Jan 2008 where there are much larger cycle points coming together. Perhaps start of something larger than last correction.

Cheers

 

[trishan9390]

Giday rnr

This is from MTPredictor, I haven't done any news/volume etc research on this, just posting the chart.
The stop is a long way from the entry, some R/R calcs required.

Up 11% at the time of writing this post. Nice one.

 

[rub92me]

Decided to short the XJO last night.

Have placed a stop at 6744.

Reasoning behind trade: We had a 3 wave structure down from the 16th July to 17th August. We have had another 3 wave advance so far from the 17th August low. This may be an irregular flat correction in progress from the 16th of July that is incomplete. If this is the case then we need another impulse to at least re test the lows(17th August) perhaps go further.

Sentiment at present in the market can be described as hyper bullish, so this is well worth a go IMO.

Current price action also coincides with an important cycle point high on the 5th October plus or minus one day(market is also 34 fibonacci trading days up from Aug 17 low), so this this could continue till Monday bullishly within our time window. The next important cycle point is 14/15th November.(Not sure whether this will mark a high or a low- hoping for a low!!)

Trade Contingencies: If the pattern of trend is showing a struggle down that appears corrective instead of impulse, this maybe simply a second degree countertrend(These usually last 11-14 days) instead of a developing impulse.

As such if this is the case all bets are off! The market will most likely continue bullishly till the next major trend change window in mid to late Jan 2008 where there are much larger cycle points coming together. Perhaps start of something larger than last correction.

Cheers

Thanks for the post wavepicker, very informative. I did a similar thing (shorting SPI), with slightly wider stop on the upside once it looked it didn't want to storm past the 6700-6720 barrier.
How would you recognise a 'second degree countertrend' as opposed to an impulse move? I'm using 6470-6500 as the first target for the next 2 weeks. If it doesn't drop (significantly) below that, then I'll probably take it out and see what develops next. (If I don't get stopped out before that of course).

 

[wavepicker]

Thanks for the post wavepicker, very informative. I did a similar thing (shorting SPI), with slightly wider stop on the upside once it looked it didn't want to storm past the 6700-6720 barrier.
How would you recognise a 'second degree countertrend' as opposed to an impulse move? I'm using 6470-6500 as the first target for the next 2 weeks. If it doesn't drop (significantly) below that, then I'll probably take it out and see what develops next. (If I don't get stopped out before that of course).

That is quite easy rub92me,

most corrections are struggling moves down and have corrective hallmarks, ie they don't resemble a normal trend or impulse as there are no spaces consolidations and previous support levels.

Idon't have a chart handy, but look at the DJIA for example from 2000-2003. It is a struggling ,overlapping, corrective move down and very messy. The subsequent move up from the 2003 low is a clean impluse and is more like a normal type of trend.

Hope this helps

 

[Kauri]

Decided to short the XJO last night.

Have placed a stop at 6744.

Reasoning behind trade: We had a 3 wave structure down from the 16th July to 17th August. We have had another 3 wave advance so far from the 17th August low. This may be an irregular flat correction in progress from the 16th of July that is incomplete. If this is the case then we need another impulse to at least re test the lows(17th August) perhaps go further.

Sentiment at present in the market can be described as hyper bullish, so this is well worth a go IMO.

Current price action also coincides with an important cycle point high on the 5th October plus or minus one day(market is also 34 fibonacci trading days up from Aug 17 low), so this this could continue till Monday bullishly within our time window. The next important cycle point is 14/15th November.(Not sure whether this will mark a high or a low- hoping for a low!!)

Trade Contingencies: If the pattern of trend is showing a struggle down that appears corrective instead of impulse, this maybe simply a second degree countertrend(These usually last 11-14 days) instead of a developing impulse.

As such if this is the case all bets are off! The market will most likely continue bullishly till the next major trend change window in mid to late Jan 2008 where there are much larger cycle points coming together. Perhaps start of something larger than last correction.

Cheers

Hi Waves,
Miners time routines both show the next couple of days to be potentially important as well... interesting times..
Cheers
..........Kauri

 

[Lachlan6]

Went short some ASX today purely on the chart pattern. It has run hard recently and may need to let off some steam after the recent shooting star pattern. Scaled in at $54.98 then $54.68.