Copper triangle awaits breakout

We have some clear boundaries now in March 2012 copper futures. the converging pattern since October invites patience for a clear breakout. More likely a continuation of the previous downtrend but let the market show. A good strategy could be to use options either side of the boundaries.

Newscorp channel break unconvincing

In an earlier blog I suggested the downward sloping channel in Newscorp should be watched for reversals at channel boundaries or a break through the upper boundary for a change of trend. Well Newscorp has pierced the upper line on the weekly chart above. However the move is unconvincing. Note the lack of increase in volume on the breakout and the fall off in volume in general as Newscorp rallied from its June low. I'd like to see a significant pick-up in volume of shares traded on any new advance to be convinced this is the start of any major move.

Sugar Wedge forming

After its triple top break in September the Sugar continuous chart has been forming a neat downward sloping wedge. Volume has dropped off and trading boundaries have converged. Watch for a break out of the top line of this wedge. Until then the trend remains down with the horizontal support line in Nov/Dec indicating where a further down-leg would commence if broken.

S&P 500 marking time but still bearish

The S&P 500 is still in bear mode after its fall from a head and shoulders top in August. The rally back the the neckline was classic charting. The oscillations in narrowing ranges since then also fit within what is becoming a channel or flag. So there are some clearly defined levels to watch now. ON the downside the uptrend line from the 1073 low in early October.There is also the support line linking that August low with a slightly lower low  back in July 2010.

On he upside there are several important levels of interest. A signal another upleg is coming would start with a break above the down-sloping line linking the right shoulder in July with the recent test of the neckline. The next resistance level to overcome would be the right shoulder and head themselves.

The most likely scenario still seems to me to be we will test the 2009 lows.

Spot Gold bullish short term, bearish long-term

View my video of spot gold action since making its top. I expect a short-term bounce after Friday's outside range day and strong close but there is no sign that a major uptrend is about to emerge any time soon. I think it is more likely recent lows will be taken out with a retracement back to the 1000 level. But I'll wait for the break.

Dow bear market rallies

Everything points to us being in an equities bear market now. The October rally failed neatly at the head and shoulders neckline after which it formed a symmetrical triangle. The downside break from that confirmed the bear bias now gripping the market. The rally of he past couple of days is unconvincing although a test of the traingle breakout at around 11700 is a possibility. Only a rise above the recent traingle top would negate the bearish outlook.

Qantas reverses

Well qantas looked promising but I did say $1.80 might stop it. It barely made that level and has now failed by falling back inside the neckline of the head and shoulders bottomand also reaking a small uptrend line. Disappointing but not all technical patterns come to pass. There was some money in this one but I'd call it a failure really. Waiting for the next pattern to emerge now.

National Australia Bank in middle of channel

After hitting the top of the channel as shown above NAB has moved to the middle of the channel. The important levels are plain to see and the next trading opportunity will eventuate when either the lower boundary is reached or an upside breakout occurs.

Cotton futures make a break for it

I'm not really interested in what the news is or what the fundamentals are. All I know is that this chart is telling me if I was long I'd be very afraid. This continuous cotton futures chart shows a break down out of a head and shoulders continuation pattern with increasing spread and closing near its lows. The only saving grace could be the lack of volume but given this is a continuous chart that may just be a factor of he December contract petering out. I'd expect at least an 18.00 fall from here to around 77.00. If it can regain that lower boundary line shown on this chart and move above 105.00 I'd reconsider. But for now the path of least resistance is down.

S&P500 index coiled and ready

The S&P500 index is tightly coiled in a small triangle poised for the next major move. After stopping near the neckline of the August breakout activity has slowed as the bulls and bears battle for supremacy. My preference would be for a downside break from this triangle but lets let the market show us.

Apple (AAPL) Broadening Top?

Is Apple forming a broadening top? The horizontal lower boundary at 353-354 represents a crucial level for Apple. An island reversal signalled the third top in this pattern in October followed by a small triangle formed on dercreasing volume. The measuring formula from this type of patten should Apple break clearly below 353 is minimum around 280. Unwise to pre-empt this move. To me charting is all about breakouts. But people sometimes do on this pattern.

Euro FX - fails again

Since breaking down out of a channel in early September the Euro has now made two attempts to push back inside that channel - just after the breakout and near the end of October. Both rallies were rejected giving this channel line some importance. We also now have a sort of broadening wedge from the April top and the most logical next move would seem to be a test of the lower boundary line of that near 1.3000. That should now be support. A break of the upper line of this broadening pattern would be significant. So short -term and medium term down but watch for a breakout.

Gold

Gold has certainly rallied more than I expected having breezed through what I expected would be stiff resistance at $1700. Until it makes a new all-time high I'd have to remain bearish. We now have a channel pattern having formed with the lower boundary, to me, looking like it wants to be revisited around the $1700 level. It just feels like a lot of space needs filling there. On the other side A push through $1800 would see a swift test of the all-time high around $1900 I suspect. Watch for the breakout of this channel and the $1800 level.

Silver

Spot silver has some clearly defined boundaries to contend with. Sitting within a rising wedge within a larger downward channel the breakout points to watch are obvious. These situations demand a wait and see approach. I'm always looking for breakouts, not trying to anticipate them.

FTSE 100 Long-term chart

The Footsie (FT100 - UK stockmarket) shows similarities to the 2007 top. Watch this video to see the important support and resistance points to watch out for.

Dow Downside risk severe

The US equities markets sit on a knife edge still. The downside risk now is emmense. I feel it could traverse to the 10500 level  in a very short space of time even within a day. The global debt uncertainty has created the environment for a total absence of buyers. Technically the market has tested the neckline a couple of times and been forced back. Certainly if the high of the past 2 weeks is taken out I would turn mildly bullish but I prefer the downside. Beware!!!

Silver Wedge bear setup

Finally silver is exhibiting some recognisable patterns and clear boundaries for traders to trade on. Notice the downtrend channel from the April top with an internal little wedge. Watch a break of both these patterns for an indicator of the next medium-term and major trends. The wedge feels like we need to see a downside test of the channel even if an upside test of the smaller wedge comes first.

Aussie Danger

The Australian dollar is in big trouble here. Possibility of a rally back up to 1.0200 but 96.000 is the next target count from this hourly chart showing a head and shoulders. The feeling isn't great across all financial markets and some "freefalls" in equities as well look to be setting themselves up. The end game has only just begun unfortunately.

Newscorp - same channel

Newscorp is exhibiting a similar channel pattern to National Australia Bank and is testing the upside of that. Any upside break from this should be watched for increasing volume and a good clearance for this to be a change of trend. More likely at the moment this trendline touch will prove stiff resistance. Note the decreasing volume on the recent rise indicating a reduction in buying power. If this trendline  upper boundary holds the bottom of the channel would be the next likely target.

NAB channel-bound

National Australia Bank has formed a clear downward sloping channel now and could well test the upside again in the next week or two. Should it fail at this line again we could well see a retest of the lower boundary in the 18-20 range. Watch for a clear breakout of this channel on the upside on increasing volume before considering NAB bullish. So far the upmoves have been on decreasing volume which isn't a positive sign.