Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Euro, USD, Gold and Stocks According to Chartology

Stock-Markets / Financial Markets 2014 Oct 23, 2014 - 01:13 PM GMT

By: Rambus_Chartology

Stock-Markets

Lets start off the Wednesday Report by looking at several currencies that broke out today. As you know the Eruo has been one of the weakest currencies out there. Today's breakout of a bear flag confirms there is more downside to come. This first chart is a daily look which shows the Euro formed a H&S top in the first half of this year and broke down sharply in late July. The Euro has been chopping out the blue bear flag for most of October which broke down today with a breakout gap.


Euro Daily Chart

Below is a weekly chart I've been following very closely that shows the bear flag, on the daily chart above, was the backtest to the bottom rail of the bearish expanding rising wedge. This chart shows the second leg down is just getting started.

Euro Weekly Chart

This long term monthly chart shows the break down from the bearish rising wedge and the impulse move that has been taking place since the breakout. The euro has been locked in the downtrend channel since topping out in 2008 with no end in sight.

Euro Monthly Chart

In this last Euro chart I've overlaid gold on top of the euro so you can see how the two can trade together at times. Sometimes they move in lockstep and other times in the opposite direction. Since August of this year the two have been moving together fairly closely.

Euro and Gold Daily Chart

A quick update on the Yen shows the backtest last week to the area of the breakout gap from the massive H&S top, green circle. So far this is prefect Chartology. Now we need to see it break back below the bottom blue rail of the falling wedge to really get the move going to the downside as all the work will be completed in regards to the breakout and backtesting.

Japanese Yen Weekly Chart

On the chart below I've overlaid gold on top of the yen so you can see the correlation between the two that has been pretty strong since the middle of July of this year.

Japanese Yen Daily Chart

The daily chart for the US dollar shows it has formed a blue flag that is getting ready to breakout. Note the little red rectangle that formed just below the brown shaded support and resistance zone. That little red rectangle gave the US dollar the extra strength to finally breakout above the S&R zone. Now notice how our blue flag has been forming right on top of the brown shaded S&R zone. Again, this is perfect Chartology where resistance turns into support once it's broken.

US Dollar Daily Chart

This long term weekly chart puts our brown shaded support zone in perspective. The bottom of our latest move up started with the blue 5 point rectangle reversal pattern to the upside. After reversing symmetry up the US dollar ran into the old highs where it just plowed right on through to the topside of the brown shaded S&R zone. The backtest was the blue flag I showed you on the daily chart above.

US Dollar Weekly Chart

The last chart for the US dollar is a chart I've been showing for years where I've overlaid gold on top of the US dollar. I would like to focus your attention to the right hand side of the chart that shows a thin black dashed line, one on gold and the other on the US dollar, blue arrows. What the blue arrows show is how gold has been acting a little frisky recently while the US dollar has been chopping out its blue flag as shown on the daily chart. The US dollar has broken above its resistance line while gold is still finding support on its support line. Once the US dollar starts to rally I believe gold will finally break below its support line which is actually a descending triangle. You can clearly see the trend has been down for gold and up for the US dollar since 2011.

Gold Weekly Chart

KAMIKAZI TRADE

As you know I bought back most of the shares I sold several weeks ago on JDST today. The first chart is a 2 hour look GDXJ that shows the downtrend channel that has been in place since July of this year. Outside of the big rally several weeks ago the GDXJ has made lower highs and lower lows the whole way down. There were the three fanlines that helped in identifying the downtrend. Just below fanline #3 GDXJ formed a blue rectangle that had a false breakout to the upside but quickly turned right around to trade lower negating the false breakout. Next you can see the blue triangle that formed just below the bottom rail of the downtrend channel which gave us one consolidation pattern above and one below which I've pointed out many time is a bearish setup. As you can see the bottom rail of the downtrend channel has held resistance since it was broken to the downside in September. Today the bottom blue triangle broke out signaling a resumption of the impulse move lower. Confirmation will be when GDXJ puts in a new lower low.

Market Vectors Junior Gold Miners 2-Hour Chart

Below is a close up look, on the 30 minute chart I showed you this morning, of the morphing blue triangle. This is the reason I bought JDST in the fashion I did today.

Market Vectors Junior Gold Miners 30-Minute Chart

Below is another 2 hour chart shows that shows you the downtrend channel from a different perspective. As you can see there has been one consolidation pattern followed by another since the breakout below the brown shaded support and resistance zone.

Market Vectors Junior Gold Miners 2-Hour Chart 2

Below is a daily look for GDXJ that shows the most important chart pattern for this stock which is the blue bearish rising wedge. As you can see it hugged the bottom blue rail for about a week before gravity finally took hold and the decline began in earnest.

Market Vectors Junior Gold Miners Daily Chart

As the rising wedge is the most import chart pattern for the GDXJ I have to put it in perspective by looking at the weekly chart. Folks, it just doesn't get any prettier. One can complicate things to make it much harder than what it is. Keep it as simple as possible.

Market Vectors Junior Gold Miners Weekly Chart

US STOCK WORLD

As you know we've taken on some big positions in the different areas of the markets recently. We are now entering the toughest time when you take your initial positions. No stock or market goes straight up or down but more like two steps forward, in a bull market, and one step back. After moving 2 steps forward we are now taking our one step back if this is just a correction in an on going bull market. There is no way to know 100% for sure if we're in still in a bull market or have entered into the dreaded bear market that everyone is claiming.

Lets start with a 2 hour chart for the Dow that shows the inverse H&S bottom that broke out and now is in the process of doing the backtest which would come in around the 16,395 area. You can see a similar inverse H&S bottom that formed at the August low that had a strong backtest but still worked out OK.

Dow 2-Hour Chart

While we're on the Dow I would like to show you the down to up volume chart that I've shown you recently. As you can see we've had 2 days where the down to up volume exceeded 8.5 which can be a good indication of some capitulation by the bulls. The capitulation volume doesn't have to come at the exact bottom as you can see from previous capitulation bottoms.

Dow Daily Chart

Below is a 2 hour chart for the NDX that shows its inverse H&S bottom. The main concern I have here is the big gap that was made on the way up.

NASDAQ 100 2-Hour Chart

The NDX four horsemen are still positive.

NASDAQ 100 Daily Chart

The 2 hour chart for the RUT shows it's now backtesting the neckline. You can see the August inverse H&S bottom had a strong backtest before it began its rally. So far nothing is broken yet. Tomorrow maybe a different story though.

Russell 2000 2-Hour Chart

The 4 horsemen are still positive.

Russell 2000 Daily Chart

As it is getting late there is one more chart I would like to show you which is the NYSI Summation Index. Normally when the Summation Index gets down to the brown shaded area a bottom is usually pretty close at hand. The exception being is when the markets are in crash mode like the 2009 decline. Many times you will see a double bottom where the SPX will make a lower low while the Summation Index will make a higher low, which is a positive divergence. Our current correction has been the strongest one since the 2011 low. What I'm looking for is for the Summation Index to turn up first, which it has, and then for the MACD to crossover to the upside, which it has. The only question is, will we see a double bottom as seen in 2009, 2010 and 2011? Stay tuned as things are starting to get really interesting.

All the best...Rambus

NYSE Summation Index Daily Chart


All the best

Gary (for Rambus Chartology)

http://rambus1.com

FREE TRIAL - http://rambus1.com/?page_id=10

© 2014 Copyright Rambus- All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Rambus Chartology Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in