#DOW #FRANCE Tern is proving a bit of a puzzle. For the last few weeks, we’ve been anticipating it finding an excuse to bottom just above the 4p level. We’re starting to wonder if it’s a Brexit inspired share, something which promises to do something which never actually happens.
Thus far, the lowest achieved has been 7.65p and weakness below such a level
remains pointing at 4p but we’re having some doubts.
The reason for our hesitation comes from the plethora of coloured lines on
the chart. There appears little doubt TERN share price is simply ignoring prior
downtrends with the result something else must be driving the current period of
hiatus and we’d guess it isn’t chatroom gossip! Instead, it would be reasonable
to assume the market is patiently waiting for some sort of news, perhaps an
indication “The Internet of Things” is actually becoming a “thing”. Or perhaps
one of their investments is expected to come to fruition.
In the meantime, we’ll remain cautious, looking carefully at the glass
ceiling which has formed at 13.25p. Only movement above such a level is liable
to make us raise an eyebrow as this should trigger recovery to an initial 18p.
If exceeded on any initial surge, secondary calculates at 20p and visually yet
another glass ceiling awaits any rising cycle. Only with closure beyond such a
level will we enthusiastically proclaim the potentials of 33p in the future.
At present, it’s worth remembering of the dangers below 7.65p and perhaps
simple remembering patience.
#Gold #SP500 Hell IS NOT Woodfords price movements, it’s two grand-daughters visiting for their school holidays. A normal morning has one of the dogs barking at a red squirrel outside. Monday morning at 7am instead had a child playing a 12 string guitar, accompanied by the other on a mandolin. Neither child can play an instrument; a stupid promise of being taught some basics this week ensured a really unpleasant wakeup. Thankfully chainsaw lessons had not been mentioned!
Last time we reviewed Woodford (link),
we’d given 52.60p as level, below which, opened the gates of hell. Once again,
we’ve had a few emails asking us to explore what may be coming next. There’s a
fairly major issue as last time, we were unable to calculate below 52.60p
without casually throwing minus signs into the conversation. This is still the
case but if we opt to work on the period from the point the share was forced
down (circled) from the 80p region, there’s something potentially interesting.
At time of writing, it’s trading at 37.6p, needing
below 35p to once again serve notice of trouble. This time, below 35 indicates
the potential of movement to 32.5p with secondary, if broken, down at 30p. Given
these are virtually the same number, the usual suggestion is of a share
approaching a real bottom, a level at which a rebound can be indicated.
All this Brexit nonsense was the subject of
conversation at the weekend. A chum was visiting, a bloke whose company
specialises in asbestos survey pre-renovation or demolition. Over the years,
we’ve learned to associate the volume of his work with how busy the economy is
going to be. The thinking is fairly simple, if corporate bodies are employing
him, there’s a fair bit of money about to be spent. Presently, he’s turning away
contracts, due to being deluged with public and private sector requests. Given
historical experience, thoughts of a slump post Brexit are liable to fade.
For the likes of Woodford, a trust fund suffering some
investment choices which, for now, appear dreadful, if there is a miracle surge
in share prices post-Brexit (if it ever happens) we’d suspect Woodfords share
price to echo the wider market. This is why we’re a little bit interested at the
“feel” of it approaching a bottom.
Sensible people, opting to play safe, will doubtless wait and see if the
share recovers above 50p. In such an event, we’re calculating an initial
ambition at 57.5p with secondary, if bettered, a longer term 75p. Beyond 75p and
we shall need shake the tea leaves again.
Otherwise, it is worth remembering the share, despite our slight enthusiasm,
is trading in a region where The Big Picture cannot calculate a bottom without
minus signs!
Bitcoin BTCUSD With Jeremy Clarkston making “Who Wants to Be A Millionaire” viewable, utter shock was experienced losing £32,000 hypothetical pounds when getting an answer wrong! The reason; being 100% certain Pioneer 1 visited Mars while the Viking space probe did Venus & Saturn, with the idiot on TV walking into the trap, saying “Viking”. Except, of course, for a tiny little problem ; my 100% certainty was utter tosh.
Thankfully, this sort of nonsense rarely translates to
our attitude against prices as we’re able to constantly weigh forces, usually
able to make a reasonable bigger picture decision with a fair chance of
accuracy. Further to our report in September, Bitcoin indeed tumbled to 9218 and
in the period since, has hovered above our secondary longer term target at 7220.
So far, the closest achieved has been 7665 dollars, visually giving an
impression it may be “close enough” to bottom, if any real strength is apparent.
We’re not entirely sold on the idea, thanks to the BLUE
downtrend. It suggests Bitcoin presently requires exceed 9900 before we dare
start to trust any rise. The reason is fairly painful as weakness now below 7665
indicates expected travel to an initial 7220 with secondary, if (when) broken,
now at a long term 4,900. Despite such a secondary sounding like a substantial
drop, it simply returns Bitcoin to the levels of April this year. In plain
English, the forces against Bitcoin, even though it has not achieved our 7220,
remain down at present.
To give an indication any rise my prove genuine, the price needs above 9534 as this apparently calculates with an initial ambition at 9955. If exceeded, secondary calculates at 11745, along with almost certain hesitation.
#SP500 #JAPAN As the clock ticks down (or not) to Brexit, we’ve been considering suggestions on how to trade! The reason is fairly basic, there’s a good chance of market volatility with a bunch of lazy writers quoting trite Warren Buffet sayings. It would be nice to say we already know what’s coming but it’d also be utter bulls**t. While many respected economists are queuing up to do their “talking heads” thing to predict calamity, famine, markets crashing, lack of toilet paper, etc, it’s worth remembering not a single one of them got it right with the crash which culminated in 2009, a crash we still feel the effects of.
It’s possible, if these clowns are predicting chaos, we
should actually anticipate the opposite, should Brexit actually happen.
One thing is certain. Even if there is no chaos, the
market will invent some on Brexit day as wild swings will be the immediate
fashion. Of course, the reason for wild swings is rather less glamorous than
folk like to admit. A game of “trap the stop loss” and “trigger the order” will
commence, effectively meaning STOPS and ORDERS risk proving a really bad idea.
Imagine, for instance, a trader with a cunning plan
which involves Lloyds shares. Visually, there’s a heck of an argument suggesting
this should go up in price, if it only betters 57p. Equally, if it drops below
48p, it’s probably going down. On Brexit day, it would be perfectly feasible for
the price to surge to 57p for a second, triggering the buy order. And at 2
seconds past 8am, it would probably fall below 48p, triggering the stop loss.
So, if the trader had allocated £10K to the Lloyds
trade, they’d lose nearly £1,600 within the opening seconds of the market day.
This is not a fairytale, it happens.
To trade safely at Brexit, if Brexit ever happens,
STOPS are liable to be the enemy and therefore, worth either expanding to absurd
levels or removing entirely. Equally, on the subject of ORDERS, they can prove
dangerous unless opting to chase the absurd. In the case of Lloyds, a buy order
around 30p would make sense. RBS on the other hand allows 142p, perhaps even
100p.
We’ll cover this in greater detail as the month
unravels.
As for Friday, the FTSE is making as much sense as a
Labour politician when asked their policy on Europe. While genuinely preferring
to avoid distain and distrust against any specific party (they all deserve it),
Labour justifying a position where they approve of Europe membership, while
being determined to leave is frankly beyond parody. Even up here in Scotland,
lunatics appear to be flourishing in politics.
At a time when almost 1/4 million Scots marched in
torrential rain, on Edinburgh last weekend for independence (somehow the media
didn’t notice nor did the SNP) and nearly 2/3 of the country voted Remain, it
would be logical to expect the SNP to be working hard to achieve their
independent aim? Nope, their focus appears to be on saving England from its
apparently mistaken belief that Leaving Europe is a good thing. Scottish
politicians seem to be competing with the national football team in achieving
absolutely nothing and being a joke in their own country.
The index closed Thursday at 7197 points and appears to
have set 7225 points as a valid trigger level for any real rise. Above 7225
expects a useless 7235 points initially with secondary, if bettered, at 7309
allegedly. Recent market behaviour has seen rises fail roughly half way to their
secondary and if this is the case again, the index will probably fizzle at 7270
points or so.
If triggered, the tightest stop looks like 7140 points.
The alternate position; what happens if 7140 breaks? We
calculate reversal to an initial 7122 with secondary, if broken, at 7091 points.
We’d add, if the index starts trading below RED, this years uptrend, Boris need
only announce something daft to provoke 7027 points very fast.
#CAC40 #SP500 It’s been some time since we covered this particular #Forex pairing, something of a surprise as we’d generally been quite spiteful about the Force India Formula 1 outfit. Thankfully Farce India are no more, the team taken over and renamed Racing Point and still based at Silverstone.
The Rupee / Sterling relationship needs, like so many
other instruments, a glance back 10 years to 2009 as we need make a decision on
the visuals for the intervening 10 years since the last financial tumble. At
present, there are a few alarm bells ringing with this pairing as weakness now
below 86.25 risks reversal down to an initial 83.80. This risks being
significant, again breaking the long term uptrend and risking continued
reversals to 79, should 83.80 break on the initial drop.
It’s probably worth looking at the inset on the chart
below. The relationship was gapped (aka manipulated) back above the ruling
uptrend in August, suggesting the market was perfectly aware the dangers of a
drop.
In this particular instance, despite 79 making a lot of
visual sense as “bottom”, our software insists this scenario should complete at
a bottom of 75.
What if a miracle occurs?
The relationship needs exceed 89.50 at present to
suggest it’s moving out of trouble. This should permit some recovery up to an
initial 94 with secondary, if exceeded, calculating at a longer term 100.
There’s certainly a heck of an argument favouring a pause at 94 but our
secondary ambition looks less possible.
#GOLD #DOW Today, we were late issuing our lunchtime futures! No excuse was given, primarily due to it being utterly ridiculous. The problem started while examining the DAX, attempting to decide whether the growth projection generated had any visual justification. When a large wasp settled on the right hand monitor, it triggered a classic “flight” instinct which saw the glass office door firmly closed with what dignity remained.
Mrs T&T, the official wasp exterminator, was out
walking the dogs and left no option other than to slightly open the door, fill
the office with a killer fragrance any wasp will die for, and go make coffee
while awaiting the monsters death within 15 minutes. At least, that’s what it
said on the label.
Approaching the office door, I was greeted with an
horrid sight. One of our unwanted cats (long story), both of which are banned
from the office, was curled up on a chair, absently watching the wasp patrolling
the sky above it. Spraying insecticide into a closed room with an animal was a
big “no no”, resulting in the absurd situation of waiting until the dogs
returned before regaining control of the office. Futures, along with a
(successful) projection against Germany, were produced an hour late. But on the
bright side, the wasp was successfully squished with a disappointing lack of
drama.
A look at Germany from a Big Picture perspective
appears justified as something is happening apparently. It appears weakness now
below 11,930 point should generate traffic downward to an initial 11,786 points.
While not a particularly impressive ambition, there’s some quite dangerous
potentials if 11,786 breaks.
Such a scenario allows travel down to 11,321 points.
While the visuals indicate some sort of bounce is probable at such a level, we
suspect it will prove short lived as realistically the index will be trading in
a region where a longer term bottom is at 10,192 points. This will break the
uptrend since 2011, leaving the market open to some quite extreme behaviour if
market conditions get really negative.
The Blue downtrend appears to be presenting a sacred
line the market is afraid to cross. At present, the DAX needs above 12,475 to
exceed this trend, launching into a region where 13,650 calculates as possible.
RBS (LSE:RBS) We cheerfully skipped a Sept report for RBS. It ‘successdully’ hit our initial bounce target of 196 and exceeded it, alas fading at 218p, just below our secondary of 220p. We suspect achieving 220p shall prove very significant, if any rise is to be taken seriously.
If we pause for a moment and consider what’s unlikely
to happen, above 220p now suggests recovery to an initial 238p. If exceeded,
secondary calculates at a longer term 282p. We’re pretty far from convinced,
thanks to the visuals. Growth to target levels as postulated suggest a coming
series of “higher highs”, along with the potential of some serious long term
growth.
Like everyone else, we watch the news and “long term
growth” and “banking sector” are terms which rarely appear together!
Surprisingly, RBS share price has now exceeded the long
term downtrend since 2008 and the inset highlights how the share’ closing price
has reacted to this momentous occasion. After a brief surge upward, the rise
faded and visually we believe it intends dribble down to 178p next, probably
carefully above the Blue trend line. If this is the case, 178p should appear
just before the end of this month. The real danger comes with any break below
178p as reversal now to 142p (and hopefully a bottom) calculates as possible.
Failing that, there’s a pretty solid hope it “must”
(aka might) bounce at 100p.
