Dow Power or Dead Cat Bounce?
Thanks Giving Special: We're celebrating these sexy declines, perhaps you didn't have much joy with them but tradingmarketsignals.com uncovered them and with that we're giving readers the chance to join us exclusively in which we've taken $20 of our 6 month subscription ends 25th November 2010.
Strong Rally virtually wipes out Tuesday decline...what did TradingMarketSignals.com do and what's likely now?
Dow Jones 4 Hour Chart
We gave the narrow range lines and new a move would blow off. We didn't expect the bounce to be so strong but the trigger lines marked in yellow were placed. 150 point gain for those of you that recognised the lines! Again if you gained, it's best to take the gains as we are approaching three resistance line areas. Two red lines are the rising trend and the blue line. They all are gathering at the same area - THE previous breakout FAKE out area which we have to note with significance again.
Also notice our indicator along the bottom which was tinkering with the rally notion although a bounce would have more viable or even further declines IF this was a real deal decline. For now Thursday rally is important as Friday will be a watch a see start to monitor the momentum of the next move.
We can give back some of the gains on Friday and rising somewhat into resistance can also trigger a reversal. For Friday's session watching will be important. Entering low risk shorts on slight rises won't be a silly scenario but if this was to move back to highs then it would be daft. So watch carefully at present as it's simply decision time.
For those of you who are familiar with 'candlestick charting', we pulled up the daily chart yesterday and could see that Wednesdays daily candlestick was labelled as a 'doji' these have the potential to reverse recent moves over the next session and that's what happened in hindsight AND that is why we mapped out our tight range trigger lines which were unbiased either way!
Gold Four Hour Chart
The lines were king and the metal rallied above our yellow line and gave a nice $10 move. If you took the trade, it would be wise to get out of it as the price play at present is certain.
A major four hour trend line has been brought into play and this is represented by the big red line. The price has now kissed it and we need to see if the market interacts with it further. Taking it out would lead to the upper channel area - rejecting it would reverse today's rise and take price lower.
TMS members have enjoyed the entire decline. We have even presented the notion of bouncing today but did label it as a risky trade hence if you took it the viable thing would be to get out of it. What now? As per Friday we shall see if Gold monitors the red line as well as the wider channel - After a near $100 decline; sitting on your hands won't be painful. Jumping into a wrong trade could well be...
Sterling Four Hour Chart
The price is moving tightly and the yellow lines will be deciding where to go.
Again fabulous 100 point move to the upside given by our trigger lines. It is now obvious to see that price has moved to the upper channel. Taking it out will not represent a clean break out as we have massive overhead resistance. Do keep a look out for the reversal of the upper channel as this would totally kick price back.
Join us with our Thanks Giving Special: We're celebrating these sexy declines, perhaps you didn't have much joy with them but tradingmarketsignals.com uncovered them and with that we're giving readers the chance to join us exclusively in which we've taken $20 of our 6 month subscription ends 25th November 2010. TradingMarketSignals.com 6 Month - Exclusive
Tweet
Circle Us