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US and Euro stocks mounting one more rally before crashing?

  • #381
  • Jan 29, 2019 8:00am Jan 29, 2019 8:00am
Quoting cat
I had a question the other day from a trader who follows my threads about divergence following my warning I issued on Friday about the Dax H4 divergence. " Can it be used on the smaller time frames to form a strategy "? was the question, to which I replied that because no indicator can be relied upon in isolation, one must have other indicators which help confirm whether you think the market is about to move one way or the other, because to rely on just one, whatever it may be, cannot be relied upon to be consistent, one has to have a much greater...
There was a H4 sell signal on MACD yesterday before the open on Dow... However, it found support in the 3H 100ema. Now it will be interesting if this Daily Hammer candle I see on it can push it higher. I am not sure tbh.

I've got some good resistance on Dow at 24861-864 for a potential Short and Hold
  • #382
  • Jan 29, 2019 9:10am Jan 29, 2019 9:10am
Stocks rising, but hesitantly. I have potential intra-day resistance levels of around 24,800 on the dow, and right here at 11,260 on the Dax, and one more higher level at 11,280 - 300, which need to hold if the price is going to stay beneath Friday's highs.
  • #383
  • Jan 29, 2019 9:18am Jan 29, 2019 9:18am
Quoting cat
Stocks rising, but hesitantly. I have potential intra-day resistance levels of around 24,800 on the dow, and right here at 11,260 on the Dax, and one more higher level at 11,280 - 300, which need to hold if the price is going to stay beneath Friday's highs.
I would Short and Hold on Dow at 24861-864. 61.8 + Weekly 20sma. I'd use 100SL there, and hold that puppy for dear life!
  • #384
  • Jan 29, 2019 9:20am Jan 29, 2019 9:20am
Quoting cat
Stocks rising, but hesitantly. I have potential intra-day resistance levels of around 24,800 on the dow, and right here at 11,260 on the Dax, and one more higher level at 11,280 - 300, which need to hold if the price is going to stay beneath Friday's highs.
Not sure you've notice but, Gold and Silver are making bullish runs... very sure sign there are nerves in the risky asset markets.

Just on Silver, as I follow it religiously.

US Paper to Silver ratio is DOUBLE that of US Paper to Gold ratio.
USD to Silver ratio is USD695 per Ounce now. It was USD2.13 per Ounce in 1913. Just shows you how much money has been printed in between.
Yet Silver price has increased from US14/ounce to US15.50/ounce in last month or so, but look how much extra money has been created in the system?
Silve has scope to go way higher on the ratio above.
Cyrptocurrency is in a major bear market - dead in the waters imo. Precious metals all the way.
  • #385
  • Jan 29, 2019 9:21am Jan 29, 2019 9:21am
Quoting PariCovek
{quote} Not sure you've notice but, Gold and Silver are making bullish runs... very sure sign there are nerves in the risky asset markets. Just on Silver, as I follow it religiously. US Paper to Silver ratio is DOUBLE that of US Paper to Gold ratio. USD to Silver ratio is USD695 per Ounce now. It was USD2.13 per Ounce in 1913. Just shows you how much money has been printed in between. Yet Silver price has increased from US14/ounce to US15.50/ounce in last month or so, but look how much extra money has been created in the system? Silve has scope...
I suspect also on Silver, as JP Morgan has cornered the Physical markets, now that the price is rising on the charts, I suspect they've stopped Shorting the Silvers Futures Markets to keep prices lower whilst they bought all that Silver! Now you watch them make an absolute packet!
  • #386
  • Jan 29, 2019 9:48am Jan 29, 2019 9:48am
Quoting PariCovek
{quote} Not sure you've notice but, Gold and Silver are making bullish runs... very sure sign there are nerves in the risky asset markets. Just on Silver, as I follow it religiously. US Paper to Silver ratio is DOUBLE that of US Paper to Gold ratio. USD to Silver ratio is USD695 per Ounce now. It was USD2.13 per Ounce in 1913. Just shows you how much money has been printed in between. Yet Silver price has increased from US14/ounce to US15.50/ounce in last month or so, but look how much extra money has been created in the system? Silve has scope...
Yes I have, and I said right at the start of this thread that Gold ( and silver ) needed to be watched closely because of the heavy inverse correlation with the big indecis. Money is now piling into precious metals that's for sure!
  • #387
  • Jan 29, 2019 9:56am Jan 29, 2019 9:56am
Looks like that 280 held well on Dax, and Dow snapped right back off of the R1 pivot to join it.
  • #388
  • Edited 10:22am Jan 29, 2019 10:11am | Edited 10:22am
Once again, Thursday's highs provided resistance. I entered short at 15.30 and held for half an hour and 140 points.

With the MAs converging and FOMC tomorrow evening, I have a feeling that price action will be less exciting for the next 24+ hours.

Below a 30m chart.
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  • #389
  • Jan 29, 2019 10:14am Jan 29, 2019 10:14am
Gold should power up to 360/70 now, but that level may well provide stiff resistance as it has done in the past ( monthly 100sma )
  • #390
  • Jan 29, 2019 10:18am Jan 29, 2019 10:18am
Quoting medici
Once again, Thursday's highs provided resistance. I entered short at 15.30 and held for an hour and 140 points. With the MAs converging and FOMC tomorrow evening, I have a feeling that price action will be less exciting for the next 24+ hours. Below a 30m chart. {image}
Yes that was a weird snap back on the Dow, but not on the Dax where the resistance was clear, so almost as if the Dax led the way there. I'm sure there were some Dow longs caught out by that one.
  • #391
  • Edited 11:50am Jan 29, 2019 10:26am | Edited 11:50am
Quoting cat
{quote} Yes that was a weird snap back on the Dow, but not on the Dax where the resistance was clear, so almost as if the Dax led the way there. I'm sure there were some Dow longs caught out by that one.
Not so weird in my view. There was solid selling at 3pm, then a failure to break above the high half an hour later.

See https://adamhgrimes.com/library/fund...ding-patterns/
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  • #392
  • Jan 30, 2019 2:02am Jan 30, 2019 2:02am
Quoting medici
{quote} Good morning Yes, at the same time technicals rule. There won't be any serious move down before SMA200 on the hourly has rolled over.
GM - agreed. .When you posted I had my Captain's Cap on preparing for last night's storm. As with trading, an hour of preparation is essential to avoid damage to a boat or a trading account!

Some interesting posts here yesterday

As you said, the 15:00 GMT candle (NYSE Open) was a Wide Ranged, High Volumed bearish engulfing candle, which held at the hourly 200 SMA. The overnight rally up to last Wednesday's high was on very low volume and has created a potential head & shoulders, which IF completed will project a fall to the 23,750 area. TWT
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Trading Levels with WRBs
  • #393
  • Jan 30, 2019 2:21am Jan 30, 2019 2:21am
Quoting Islander
{quote} GM - agreed. .When you posted I had my Captain's Cap on preparing for last night's storm. As with trading, an hour of preparation is essential to avoid damage to a boat or a trading account! Some interesting posts here yesterday As you said, the 15:00 GMT candle (NYSE Open) was a Wide Ranged, High Volumed bearish engulfing candle, which held at the hourly 200 SMA. The overnight rally up to last Wednesday's high was on very low volume and has created a potential head & shoulders, which IF completed will project a fall to the 23,750...
If those Shoulder's don't get taken out on NYSE, then that's a nice short pattern. I'm still kind of expecting a Short around 24861-865 though.
  • #394
  • Jan 30, 2019 3:14am Jan 30, 2019 3:14am
Quoting Islander
{quote} GM - agreed. .When you posted I had my Captain's Cap on preparing for last night's storm. As with trading, an hour of preparation is essential to avoid damage to a boat or a trading account! Some interesting posts here yesterday As you said, the 15:00 GMT candle (NYSE Open) was a Wide Ranged, High Volumed bearish engulfing candle, which held at the hourly 200 SMA. The overnight rally up to last Wednesday's high was on very low volume and has created a potential head & shoulders, which IF completed will project a fall to the 23,750...
Good morning, Captain

I concur with your analysis, and that scenario may very well play out.

As this is FOMC day, and I'm taking a day off, let me speculate that another scenario may play out.

So far the Dow has followed a classical wave pattern from the Christmas bottom - wave 1 up, wave 2 pullback, wave 3 substantial up move, wave 4 sideways consolidation. Should it continue to follow the pattern, which is based in group psychology rather than anything more esoteric (see Tony Plummer's book), then there's a high momentum move up still to be had.

SMA200 on the daily is up around 25200 - a natural target - so my hypothetical scenario is that the Dow will get there by reaction to this week's news, and then follow an ABC correction down to 24000ish to begin with.
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  • #395
  • Jan 30, 2019 3:59am Jan 30, 2019 3:59am
Couple of update charts of mine to add to the discussion, the first being the Daily Dow which is clearly butting its head up against the Daily 200ema right in the middle of the critical zone I posted awhile ago between the 61.8 & 76.4% fibs, and today's H2 chart showing my upper resistance level for today which if the price gets there may well be a good place to short from.

I'm on the road for the rest of the day, hopefully not getting snarled up in the snow and ice that is all over the country at the moment, so happy trading and I should be back on tomorrow.
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  • #396
  • Edited 7:28am Jan 30, 2019 7:01am | Edited 7:28am
All my Dow Shorts got triggered while I was away from the desk, I'm just leaving them now. 24854.
  • #397
  • Jan 30, 2019 11:04am Jan 30, 2019 11:04am
Well so much for my 800 potential resistance level on the Dow, as the price blew straight through it. Now it's getting really interesting, because not only are we approaching the 76.4% fib right on top of the big 25,000 number, but we are also not far from the Daily 200sma as well @ 25,075, with the trend line from the October high coming through just above that - really critical levels for a potential resistance, at least they should be if this rally is going to remain a pullback in a Bear market.

I see that Medici's Wave analysis has the Dow moving up to around 25,200, which is pretty much exactly where my trend line is running through, so we'll be paying special attention if the price makes it up there.
  • #398
  • Jan 30, 2019 11:42am Jan 30, 2019 11:42am
Just to add something to my last post. I'm sure some people who follow this and other threads of mine have heard me refer to a ' Death Throe ' candle. I think I coined it, I'm not sure, but I've never come across the term before in trading so perhaps I did. Anyway, a ' Death Throe ' candle , or move, is a sudden acceleration close to exhaustion levels, and it very often precedes a top or a bottom, and you will find this kind of move on any time frame. We saw it just before Bitcoin caved in ( see my thread ' Is BTC about to crash '?, and we saw it on the Dow just before the huge February sell off last year ( chart posted above ). This buying today is taking equities up to critical levels, and the fact that it seems so strong, off of no news, looks to me like we could be seeing a ' Death Throe ' move close to exhaustion levels. We will know soon enough.
  • #399
  • Jan 30, 2019 3:34pm Jan 30, 2019 3:34pm
Death throe candle = 5th wave exhaustion

Nicely spotted, cat Back in the day when I traded individual equities, I used to have access to pattern recognition software that spotted stocks in the 4th wave sideways consolidation. Placing a buy order for the "death throe candle" was free money without exception.

Again, Tony Plummer's book will explain why this pattern recurs over and over again.
  • #400
  • Jan 30, 2019 4:42pm Jan 30, 2019 4:42pm
Quoting medici
Death throe candle = 5th wave exhaustion Nicely spotted, cat Back in the day when I traded individual equities, I used to have access to pattern recognition software that spotted stocks in the 4th wave sideways consolidation. Placing a buy order for the "death throe candle" was free money without exception. Again, Tony Plummer's book will explain why this pattern recurs over and over again.
I've not heard of this book until you began referring to it , but I will buy it for sure....it's been a long time since I read a trading book, but this one sounds like one I need. No doubt people are put off by the date - 1998, but you know, the best two trading books I ever read were ' Reminiscences of a stock operator ', and ' The psychology of the Stock Market ', the latter written 100 years ago, and the former not far behind.
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