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US and Euro stocks mounting one more rally before crashing?

  • #41
  • Aug 10, 2018 8:00am Aug 10, 2018 8:00am
If this H4 100sma on Dow breaks, which it is threatening to do right now, price could fall another 200 pips easy today. On the flip side, Wall St does have a habit of buying these dips straight back up.

Dax still has plenty of bearish momentum, and looks like it's aiming for the weekly 100sma once again, the MA which has held as the main support all year, from January through to March, and again in June and July.
  • #42
  • Aug 13, 2018 1:28am Aug 13, 2018 1:28am
The Dax is just above its weekly 100sma now, which as you can see has been the big support level all year. I would expect it to hold, and the current level is also right on the 76.4% fib taken from the previous low on the 28th June.

If it pulls back, then best put the fibs on from the 31st July high, as I think that if it does pull back from here, then there's a good chance it will be temporary up to a fib resistance level before it falls again, this time to break the weekly 100sma, though that's some way off yet, perhaps in the Autumn, Oct-Nov.
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  • #43
  • Aug 13, 2018 3:40am Aug 13, 2018 3:40am
From today's Dow chart, you can see that the H4 200ema is the current support level. If the price does continue to climb, then again I've put the fibs on just to get an idea of high high it may retrace. Watch the 100sma, which is on the 38.2%. This would be a shallow retrace, but the price often comes back up to its 100sma when it is in a position like this, before falling again, something you will often see on any time frame. Should it go higher, then the 50; 61.8; and finally 76.4% are all above.
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  • #44
  • Aug 13, 2018 8:14am Aug 13, 2018 8:14am
Nice thread and charts.

subs
  • #45
  • Aug 13, 2018 2:00pm Aug 13, 2018 2:00pm
Quoting cat
From today's Dow chart, you can see that the H4 200ema is the current support level. If the price does continue to climb, then again I've put the fibs on just to get an idea of high high it may retrace. Watch the 100sma, which is on the 38.2%. This would be a shallow retrace, but the price often comes back up to its 100sma when it is in a position like this, before falling again, something you will often see on any time frame. Should it go higher, then the 50; 61.8; and finally 76.4% are all above. {image}
Worked out nice.
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  • #46
  • Aug 13, 2018 2:22pm Aug 13, 2018 2:22pm
loads of major res on weeklies
  • #47
  • Aug 13, 2018 2:45pm Aug 13, 2018 2:45pm
Quoting loozers
Nice thread and charts. subs
Thank you.
  • #48
  • Aug 16, 2018 4:27pm Aug 16, 2018 4:27pm
25000-25600 in a single day, did I miss something in the news ??
  • #49
  • Aug 17, 2018 1:05am Aug 17, 2018 1:05am
Quoting darko2010
25000-25600 in a single day, did I miss something in the news ??
You missed nothing. just dip buying monsters.
It's in fear when people show what they truly value.
  • #50
  • Aug 17, 2018 2:04am Aug 17, 2018 2:04am
Quoting ensale
{quote} You missed nothing. just dip buying monsters.
Hey ensale, great to see you here
  • #51
  • Aug 17, 2018 5:28am Aug 17, 2018 5:28am
Quoting darko2010
25000-25600 in a single day, did I miss something in the news ??

Well, probably not. There was some news out about Chinese willingness to open discussions with the US over trade, but it didn't lift Chinese stocks, so not sure. On the technical front, Dow could have pushed lower, down through the big Daily MA support, as the big ones - first the 100sma, and then the 200ema & sma are still running up beneath the price, which had fallen to within 50 pips of its 200sma which I have @ 24,904. This didn't stop the price back in June, and the technical set up on the Daily chart is pretty similar now, but perhaps the current relatively low August volume, which always makes the market less able to sustain momentum, is partly responsible. Go to the H6 tf, which is the next one up I always look at above the Daily, and you'll see that the price rebounded off its 200ema/sma support level.

I just want to bring Gold into this thread, because I think there will be a significant correlation between the turn around in the price of Gold, and an inverse move in equities. I have potential major support for Gold coming up pretty close now, anywhere really from where we are now ( it fell to 1,160 yesterday before rallying a bit ) and 140-120. Below 120, and I am wrong, but I would expect a potential bottom for Gold to fall within these levels. I will post any developments I see here on this thread, so anyone who is interested in catching the bottom in gold as an investment, as I am, stay tuned. The one doubt I do have for it, is that the monthly time frame has Gold shaping up for a fall all the way potentially back down to $1000 an ounce, which would probably correlate to a higher move in equities.

The Dow is currently reacting to this 25,600 level which has been such a tough nut for it to crack since it got up there in July, and the Dax, which has really struggled to put any gains in this week, is falling back off its 30m 100sma. but I'm not expecting new lows for it today, rather I have support pretty much where it is now on its 61.8% fib retracement from Wednesday's low. All depends what US stocks do later. If they hold up, then so should Dax, but if they sell it down hard, which they could do from this level, then Dax may follow.
  • #52
  • Aug 17, 2018 5:57am Aug 17, 2018 5:57am
Quoting cat
{quote} Well, probably not. There was some news out about Chinese willingness to open discussions with the US over trade, but it didn't lift Chinese stocks, so not sure. On the technical front, Dow could have pushed lower, down through the big Daily MA support, as the big ones - first the 100sma, and then the 200ema & sma are still running up beneath the price, which had fallen to within 50 pips of its 200sma which I have @ 24,904. This didn't stop the price back in June, and the technical set up on the Daily chart is pretty similar now, but perhaps...
Thanks Cat, I too have started watching Gold PA recently. 1150 and 1050 areas offer interesting monthly support levels, would you agree?
However, on your comment about inverse correlation with equities, Gold was pretty well correlated to equities in 2008-2009 and beyond and started going the other way only in 2012. I know Gold is generally a safe heaven, but I am puzzled by the 2008-2009 period now that you brought my attention to it.
  • #53
  • Aug 17, 2018 6:57am Aug 17, 2018 6:57am
Quoting darko2010
{quote} Thanks Cat, I too have started watching Gold PA recently. 1150 and 1050 areas offer interesting monthly support levels, would you agree? However, on your comment about inverse correlation with equities, Gold was pretty well correlated to equities in 2008-2009 and beyond and started going the other way only in 2012. I know Gold is generally a safe heaven, but I am puzzled by the 2008-2009 period now that you brought my attention to it.
Yes I agree, the correlation is pretty sketchy nowadays. During the post- crash boom, both the Dow and Gold rose until Sept 2011, from where they diverged again. Now why equities carried on rising to the stars whilst Gold plummeted is a question I cannot answer except to say that the Dow was a lot closer to its big weekly support levels than Gold was, so for example, the gap between the Dow weekly 100sma and 200ema was much narrower than it was between those on Gold, so once Gold's 100sma was broken, there was plenty of room for it to fall further. As a pure techie, I am a great believer that the big money will always follow the technicals above anything else, and if it sees that selling or buying is the way to go, that's the way it will be taken. The Trump US election win was one exception to this, as equities had been coming down, but the big picture was still one of upward momentum, so this cannot be deemed too much of a surprise. This is why, when a real turnaround in equities is confirmed, the whole pack of cards will come crashing down super fast, and this, is when Gold should really begin to rise gain. Add to this the US debt ticking time bomb, and we have the potential for easily the biggest stock market crash in history, to follow what by now is the biggest stock market rally in history.

I think Gold can be worth paying attention to because the Gold price can be a forewarning of what equities might soon do. Take the end of last year, when Gold found support on its weekly 200sma and began rallying whilst the Dow was still rallying strongly, peaking on pretty much the same day that the big January equities sell off began. More recently, there's been nothing to go on really, as Gold has plummeted since that triple top in April, whilst the Dow has just drifted sideways, edging higher in that each low has been a little bit higher than the last, but sideways nevertheless. I do feel though, that when this big stock market does happen, whenever that may be, and I think we are all agreed that it has to come sooner or later, Gold can only benefit.

Dax now on its 76.4%, so support today holds here if its not to go lower. The Dax weekly 100sma has been broken though, so it may need to fall to its weekly trend line which I have at 12,000.
  • #54
  • Aug 17, 2018 10:05am Aug 17, 2018 10:05am
As long as I don't see another selloff like in February I don't think there will be any bear market. When I first saw the crash in February, I thought there will be a similar crisis to 1987, when it just started crashing and didn't stop until the bottom.

Now, after the February crash, instantly the same continues as what happened during the last decade. BTFD, buy the fucking dip. Every time price dips, money comes in and buys it up, no matter the price. Why? I think because eventually central banks will come in and save the day, if things get too out of hand. I mean right after the price dropped heavily in February, the FED came in and did a mini-quantitative easing to stabilise the market. But wait, they said QE is stopped. Yeah it was stopped, except when the market started falling, they started it again quietly until the market calmed down. Of course they didn't make a big news out of it.

They sent the message to traders that if things will get too bad, they will come in and help out. That's why the market shakes off EVERY risk regarding the trade war and all that other stuff, because central banks will help out in the end. And they have to help, because their decade long QE messed up the markets beyond anything.

They also messed up currency markets. I follow the currency futures volume on the majors and volume is quite good, so there is plenty of trading going on, still the market moves like 5 pips every hour, with an occasional spike on the news. That means there is a giant excess of liquidity in the markets, which is the result of the mindless printing and endless supply of dollars, euros, pounds, and yens.

Now besides that, how can inflation be at historic lows is way beyond my understanding, but apparently even economists have zero idea how it is possible that it didn't start to be a problem at least in the last years. Looks like we are living in a miracle.

So no need to frighten people with a coming crash in the markets. Put up your pink sunglasses, BTFD, and print some more money, because the party never stops.
Price and volume reveals everything. The market moves on supply and demand.
  • #55
  • Aug 17, 2018 10:12am Aug 17, 2018 10:12am
Quoting Darastonius
As long as I don't see another selloff like in February I don't think there will be any bear market. When I first saw the crash in February, I thought there will be a similar crisis to 1987, when it just started crashing and didn't stop until the bottom. Now, after the February crash, instantly the same continues as what happened during the last decade. BTFD, buy the fucking dip. Every time price dips, money comes in and buys it up, no matter the price. Why? I think because eventually central banks will come in and save the day, if things get too...
Interesting take although I beg to differ, I have seen a few times in the last 25 years where people thought exactly what you say, yet the markets always crashed... For me, the real question is not whether it will happen but when exactly and what the catalyst will be. PA will show the way, as always
  • #56
  • Edited Aug 20, 2018 3:12am Aug 19, 2018 6:39am | Edited Aug 20, 2018 3:12am
" So no need to frighten people with a coming crash in the markets ".

I don't think anyone is frightened Darastonius, just keenly watching pa like all good traders must do.

Dow is at an interesting level now. On the smaller tf, there is resistance at 25,730, with unconfirmed divergence with MACD on the hourly tf. On the bigger picture, my 2 day chart has the price headed for 26,000 - 26,300 or so, but it has to push above this smaller tf resistance first. It can equally drop considerably from here given the level it is at in relation to the previous two highs. On 7th August, it looked like it was striking out for 26,000, but it stopped and fell over 700 pips before it picked up support again.

Dax has double bottomed with the June 28th Low, so it looks like it could rally now along with the Dow going higher. What I would say though is that any Dax rally is likely to be a pull back up to around 12,500, so 200 pips or so, before it rolls over and falls again, and this would correlate nicely with the Dow moving further up to the big potential resistance level I have for it. I'll be watching the pa very closely indeed if the price on the Dax and the Dow gets up to these levels.

All just speculation though at this juncture, and this coming week should be an interesting one for sure.
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  • #57
  • Aug 19, 2018 10:06am Aug 19, 2018 10:06am
Thought I'd add my weekly Dax chart. I think that the chances of a pull back to one of the fib levels - brown 50%/yellow 61.8%/orange 76.4%, are now good, and that when resistance has been confirmed, Dax could then turn south again and fall 1000 + points.

I only have my TA to go on with this, but, there will almost certainly be some news catalyst to set it on its way. Now I have no way of knowing what this is going to be, only that the technicals usually lead the way, warning of something that is yet to happen, or at least something none of us retail traders can know of in advance.

This I realize is a pretty bold prediction, and I may be wrong, but that's okay, being wrong is not something that worries me as a trader. If I am right though, there are some pretty big falls lurking just around the corner for global stocks, and they should hit before the end of the month, so if you are thinking of going on holiday, you may just want to take your laptop with you!
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  • #58
  • Aug 20, 2018 4:20am Aug 20, 2018 4:20am
I posted on Aug 17th that I was watching Gold carefully as I believe it may be at or near to a major support level. The Daily candle on the 16th was a very strong looking hammer, and the fib retracement level is the 76.4%, the same level that sent the price back up in December 2016 from the November 2015 low. I am not making any calls here, for I do not publish my trades, so I am merely drawing attention to a level I believe to be significant, a level no doubt many others have also recognized.

Nice rebound on Dax this morning as predicted in my posts over the weekend, so we're on course for what may be an historic shorting opportunity within the next ten days or so for those looking to catch a potential top and hang on in there for the long term, which isn't so fantastical a notion if you look at how overstretched US equities are historically. Again, I do not want to influence anybody, I wish only to draw attention to the possibilities.
  • #59
  • Aug 20, 2018 9:11am Aug 20, 2018 9:11am
Quoting cat
I posted on Aug 17th that I was watching Gold carefully as I believe it may be at or near to a major support level. The Daily candle on the 16th was a very strong looking hammer, and the fib retracement level is the 76.4%, the same level that sent the price back up in December 2016 from the November 2015 low. I am not making any calls here, for I do not publish my trades, so I am merely drawing attention to a level I believe to be significant, a level no doubt many others have also recognized. Nice rebound on Dax this morning as predicted in my...
I wish you were right but a 9-year bull run will take a bit more than 10 days to get shut down I am afraid. I would rather not catch the top and use my capital elsewhere while the weekly/monthly PA shows the beginning of a down swing. Markets can remain irrational longer than you can remain solvent...
  • #60
  • Aug 20, 2018 9:59am Aug 20, 2018 9:59am
Quoting darko2010
{quote} I wish you were right but a 9-year bull run will take a bit more than 10 days to get shut down I am afraid. I would rather not catch the top and use my capital elsewhere while the weekly/monthly PA shows the beginning of a down swing. Markets can remain irrational longer than you can remain solvent...
haha...too true, but there has to be a top somewhere. If I sell up there, it'll be a normal trade, by no means biting off more than I can chew, with no wild top-picking in sight.
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