Germany, Breakout or might be a trap? 12-17-2012

After 5 years of battling with its Long Term Downtrend lines, it seems that Germany has broke out of its 5yr drought.. It was not expected at first, but we waited for few weeks before I posted this analysis.

There are certain times that breakouts are false,and only to attract high volume/high speed traders, and in this scenario, let us say that I am 70% satisfied that its a breakout. and 30% that it could be a false one.

We need to check and wait for more considerations, specially that MACD is Negative Divergence, and RSI just crossed at 70. Europe might be strong this H2, increasing almost 20% in their equity prices, we may not know if turmoil in Spain,Greece could trigger any selloff anytime soon.

Short Term: Uptrend

Medium Term: Sideways to Up

Long Term: We are stilll weighing if it broke out of its 5yr downtrend resistance. a fallback to 7400 is highly probably,and we may see the correct trend anytime soon.

AU,Germany SPX,HK Snapshots 12-3-2012

Australia

 Germany

 SPX

HK

Dow, Germany, WTIC Oil 11-16-2012

DOW and Global Markets have corrected/dropped for 1.5months already, the typical for a good correction. Dow also lost 9% already in the past 6 weeks time. In case that this is just a correction, we can conclude that supports are at 12500 for possible uptrend support, and the 61.8% retracement is on place. The RSi and current Wave a = Wave c correction structure also concludes that this could be the bottom.

Although in Elliot Wave terms, int. ii must not go below the minor I of int i, we can still take this scenario as a bullish one, unless it goes below 12035 level. Current count is still as bullish state, and ongoing int. ii of Major Wave 3 of this Primary Wave III bull market.

Short Term: RSI overbought, and MACD as low as 12035 low. Positive Divergence on Daily charts, and possible uptrend support, 61.8% retracement level.

Medium Term: Possibly bottom soon.

Long Term: Uptrend

Germany was not so bad at all, only corrected 6.2% for the entire frame, and the selloff was gradual. It expanded 0.2 or 0.3% QoQ and still having a slow but sure growth, UK and France GDP just inched higher as well, but European GDP contracted and entered 2^nd recession since 2009,due to 25% unemployment of Spain and Greece, plus low GDP of Portugal and other areas.

We don’t see any support for Germany, and Global Markets doesn’t depend on Germany anymore, seems that Fiscal Cliffs drags US Equities in particular, as the effect is for US based companies. Although we may see lots of indicators that US equity is currently a good entry point, Germany may have broke its slow downtrend support. We are looking to a support near 6900. And Medium Term uptrend support at 6400.

Short Term: Correction isn’t as sync with US. Sideways to Down, possibly just broke down a major support.

Medium Term: Sideways to Up

Long Term: Sideways

Oil prices was one of my leading indicator that Equities are bound to correct. US and Europe made its new high last end Sept,but Oil sold off immediately up to 5% instantaneously. Although Equities and Oil doesn’t 100% go in tandem,this is one of the few indicators to guide the next direction of the market.

Oil has a support at 85. And has Medium/Long term support at 80. RSI is now at OK levels, thus Equity rally /bounce can begin shortly.

All actions above are ideal for Technical Reasons, in case the Fiscal Cliff extended its range and increases tax scope, Fund Managers/individuals can do a quick sell-off that can trigger our must avoid levels.

Full Analysis: NASDAQ, DOW, S&P, HK, AU, Germany 11-11-2012

 

NASDAQ:This week's extreme catch on Global Markets is the chart of NASDAQ. NASDAQ was the very first indicator that US Equity has turned a U-turn and went downtrending/correction, especially when it break below its uptrend line. What I saw that defined a possible short term rally is that, the Head and Shoulder pattern of NASDAQ just expired last Friday's close.

Could it enter a new small rally, before the Greece deadline on Nov 16. We say a 50% chance that a small rally for US equity can be seen early next week.(For short term traders).

Short Term: Downtrending may have ended (50% chance).

Medium Term: Sideways

Long Term: Uptrend

 

DOW: Meanwhile, the bellwether and the main index ( I think) of the US, the Dow, is possibly having or in a deeper head and shoulder pattern, with an estimate target of 12500. Last friday, DOW just made a low of 12743, 243 short to our target H&S Pattern. I put my 50% on the market to go a little deeper into the 12500 area in the next few days, weeks.

In Elliot Wave Analysis, the current DOW price just entered the Minor Wave 1 of Intermediate Wave 3 of Primary Wave 3 Market. The more it goes below, the greater the chance that our Wave Counts are not going to be back to Bullish mode. So we will see in these coming days/weeks, where our Market could really go. A sudden collapse in next week's Greece uncertainty, could make or break this Bull run.

 
Short Term: Downtrending may have more rooms to come. (50% chance that sideways to down to 12500 level)

Medium Term: Sideways

Long Term: Uptrend

 

 AU: Australia has never been this aggresive in terms of index rally. Though it took a pause when MACD RSI fall short and went into negative divergence. We expected that AU will hit its strong resistance in the 4600-4750 area, and it did. One of the big problem again here is that, AU is now at the very steep support. And 1day selloff could break it below again to weekly lows. I was hit with this trap last April when I am buying a lot when AU hold on into its uptrend support. 

Short Term: Uptrend, but 70% chance that current uptrend level may not hold. Big factor is the Negative Divergence in MACD.

Medium-Long Term: Sideways

 

HK: Hong Kong Market did a false breakout through the 22k level, and fell sharply as it wasnt successful to hold the 22k level. At this point in time, its 80% probability that HK will gather more strength first,before attempting to get into 22.5k level.

Short Term: False Breakout, consolidation to 21000-21500 is highly probably.

Medium-Long Term: Sideways

  

SPX: S&P is more of NASDAQ, where we are predicting that 50% chance that downtrending may have ended last friday. and may consolidate or even rally in the next few days. An immediate uptrend support for Medium Term is pegged at 1362, and this could help Bullish people to get back into the market and buy back their shares.

Short Term: Uptrend

Medium: Sideways

Long Term:Uptrend

  

Germany: Germany is set to release its 3Q 2012 GDP by next week or next next. UK is out of recession,and Germany will still be the bellwether for Europe region, weather they are still healthy compared to other deteriorating European cities.

Short Term: Peakish, Sideways to Down

Medium Term: Sideways to down

Long Term: 5yr downtrending resistance intact at 7400.

HK,AU,S&P daily weekly, Germany daily weekly 11-2-2012

HONGKONG 

AUSTRALIA

 GERMANY - Daily Chart

 GERMANY - Weekly Chart

S&P - Daily Chart

 S&P - Weekly Chart

Germany, Dow, Australia, Nasdaq and HK status update 10-22-2012

Germany is still in the spiral of temptation to breakout above its 5 yr downtrend lines. It has been a month already hovering around the resistance levels. We also had a warning signal on its weekly charts, activating a warning of RSI > 70, the 1^st time to get into this level for 2012, last was Q1 2011 where quick selloff happened after the incident.

Watch for more price action, either:

   Breakout above 7400

   Selloff back to 7000,then 6600.

S&P made a new 52 week high last Mid September, and a warning of RSI >70 popped up also,for the daily charts. After hitting that high, S&P went to a sideways to down pattern on hourly charts, but is still in uptrend for Short Term with support at 1430.

Elliot Wave count suggests that the 52 week high could be a the end of Major Wave 3 of Primary Wave III, or just a minor wave 1 of the current Major Wave 3 of Primary Wave III rally. Both ways suggest a result of correction, that might ended already at 1433, or will continue to correct further if it goes down below 1430.

Short Term: Uptrend, but threating a breakdown. A BUY when S&P revisits 1380 levels. Wait for more price actions.

Medium-Long Term: Uptrend

Hong Kong rallied the most in Asia with 16% since June. And still could be the underperforming market together with China(-20% for 2012) all over the Globe. HangSeng revisited its 2012 high at 21500-22000, and has a barricade of strong resistance levels in that area. If it can break through with the 2012 highs, it can reach 22800 for the medium term downtrend resistance. RSI now at 75, overbought level.

Short Term: Uptrend but overheating

Long Term: Sideways

NASDAQ showing symptoms that more selloffs could be coming, NASDAQ recently sold off too much that it broke down its short-medium term uptrend line, that could lead to 2950 initial support.

Australia had its best rally since 2010. Gaining 12% in 4 months time. And the very first time to reach an overbought RSI at 76 since 2010. There are many resistance levels on 4600,4650,4700,4750 before it can revisit 5000 level(2011 highs). The negative MACD Divergence is telling that short term may be it,and correction is coming.

Short Term: Uptrend but overheating

Long Term: Sideways

DOW, S&P, Germany, forecast 10-11-2012

This 4 month rally in the U.S. has already brought 16% gains. An unexpected strength since the 11% correction happened last April and May. We also notified that Germany and other European indices are the ones leading the rally. But 2 weeks ago, U.S. and Europe somewhat departed their ways, U.S. led to new fresh highs, and Germany(Europe) did not, instead corrected below when hitting their 5yr downtrend resistances.

Currently, we will just focus on the U.S., and short term, uptrend is still intact, but gaining momentum on the downside. The 4 month rally has been so strong that we haven’t had a correction of more than 5%. I think, now is the time we might expect this to happen.

Looking on the uptrend line of the DOW, it was pretty straightforward of a typical bull run, huge rally then small selloff to warm the RSI and MACD. But looking into Elliot Wave count, we might had the Minor I of Major Wave 3 of Primary Wave III Bull Market, or possibly Major Wave 3 of Primary Wave III Bull Market. Which takes into consideration that, after a Minor I or Major Wave 3, a pullback of 4-12% is normally in range, and with this steep uptrend, an estimate of breaking down into this short term uptrend,will make the economy more healthy. You know what I mean-you cant take them all in 1 rally.

If market breaks down, we expect DOW to hold support near 12900, and suggest to slowly buy into the market, as Europe GDP isn’t good still.

Europe Q2 GDP is nearing its release, and a continued contraction could easily bring DAX down to 6600 levels. First uptrend support of Germany is at 7000. I am still putting a HOLD/LIGHTEN strategy to any European Index, until a viable growth is seen. And wait till a good correction from their 25% rally since June.

U.S.

Short Term: Uptrend, but weakening. Negative Divergence on MACD and RSI. NASDAQ in downtrend.

Medium TerM: Uptrend line support now at 12800.

Long Term: Uptrend. Uptrend line since 2009 has a support now at 12500.

Germany,FTSe,CAC, Dow, HK, CHINA,KOREA, AU, WTIC 10-2-2012

The three major European indices are still tempting to get through their 5 yr downtrend resistances. Charts attached are showing that FTSE and Germany hit their 5 yr resistances and quick selloff from it. They are moving inch by inch higher,nearing to those levels, and may be tempting again to break through these 5yr levels. I am betting that they are not going to break out soon, due to deteriorating Economic Indicators.

Germany,FTSE:

Short Term: Uptrend, Attempting to get into 52week highs.

Medium Term: Sideways

Long Term: Downtrend, 5yr resistance intact

Meanwhile, US indices are in a strong phase, S&P and Dow companies are meeting earnings expectation, and economy is growing in a small but steady positive way. U.S. markets broke out of their 52 week highs and met 13653 for the DOW.

Elliot Wave Count suggest also that a final minor wave v could be happening quick soon, or may have happened when we got 13653,and is due for minor to medium type correction soon to form Major Wave 3 of Primary Wave III Bull Market. Europe is to decide, if Germany and FTSE broke out of its 5yr downtrend resistances, we are set to revisit DOW,NASDAQ and S&P’a All Time High.

Warning Issue: Germany hit 7400. 5 year downtrend resistance 9-18-2012

I have no access with my blog for the past week, and noticed that Europe and U.S. made into new highs for the past months.

We should now issue a warning for this possible 7400 peak in short term or maybe in long term. Initial resistance we are watching was 7000 level, and it was passed through easily that made help U.S. get into new 52-week highs.

All other European Nation like France and U.K. are also in this type of 5yr resistance, all charts seems to be the same.

Bellwether for U.S. Economy has been strong gaining almost 20% for the past 4 months since the bottom in May-June. We saw European funds get into the Highest Yields YTD. And we now issue a warning signal to continue to lighten,due to deteriorating Economy plus Spain made a new low, hitting below 2007 levels, a very bearish economy.

Stay light for now, as Negative Divergence in MACD and RSI are seen in European and U.S. Indices.

Short Term: Uptrend with resistance of 7433.
Medium Term: Sideways
Long Term: Long Term 5 yr downtrend resistance still intact and declining.

PSE Stock Snapshots: MEG, FLI, PCOR, PX, EDC, MBT, BDO, AC, ABSP 9-10-2012

PSE Stocks:

Most have peaked short term, and may also be their 2012 highs.

30% - Heavily Downtrend

50% - Sideways

20% - Uptrend

 

 

 

 

 

 

 

 

Germany, France, U.K. and Dow Jones 9-6-2012

European Markets are steady residing into their resistance levels. Low volume and not much fluctuations. They are actually flirting to breakout of their resistances, but no one wants to be with them. News in Europe isn’t going well, mostly flat or even to the downside. We still believe that these 2yr to 5yr resistances aren’t able to break soon.

Slightly peak-ish European Markets may have a meaning of lower upward risk trade or probably more Short-Selling for U.S. Markets.

Germany:

Short Term: 2yr downtrend resistance still at 7000-7050.

Medium/Long Term: Downtrend, with 5yr resistance at 7400 is next in place if 7000-7050 is eked out. or Possible trade the range sideways pattern in these coming years.

London:

Short/Medium/Long Term: 5 year downtrend line still intact, making 5830 the resistance point to tackle. Further contract of Economy could send this lower to 5000 to 5250.

France:

Short/Medium/Long Term: resistance at 3500 to 3600. Not much independent trend, following UK and Germany’s trend I believe.

Dow Jones is still in uptrend short term, it was able to revisit the 52 week highs, but was not able to get above it. We are expecting Dow to follow Germany’s direction, and is biased that Europe may have peaked short term, and may setup a false breakout trap. I haven’t seen a fresh 3 in a row contracting Quarters that made new highs. Looking for Dow to hold around 12800-12900 to stay uptrend.

Short Term: Uptrend at 12800-12900 support, and flat resistance at 13330.

Medium/Long Term: Uptrend