Trends And Targets

#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.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:48:10PM	BRENT	58.19									‘cess
9:49:30PM	GOLD	1505.61
9:51:34PM	FTSE	7187.94
9:54:34PM	FRANCE	5515.2	5463	5452.5	5438	5507	5527	5537	5570	5480	Shambles
10:09:05PM	GERMANY	12112.65									Success
10:10:41PM	US500	2921.22	2890	2873.5	2855	2925	2930	2943.5	2962	2900
10:24:05PM	DOW	26366									‘cess
10:26:22PM	NASDAQ	7691
10:29:11PM	JAPAN	21583									‘cess

 

9/10/2019 FTSE Closed at 7166 points. Change of 0.32%. Total value traded through LSE was: £ 5,209,605,060 a change of -0.79%

8/10/2019 FTSE Closed at 7143 points. Change of -0.75%. Total value traded through LSE was: £ 5,250,871,756 a change of -5.63%

7/10/2019 FTSE Closed at 7197 points. Change of 0.59%. Total value traded through LSE was: £ 5,564,169,791 a change of 8.23%

4/10/2019 FTSE Closed at 7155 points. Change of 1.1%. Total value traded through LSE was: £ 5,141,232,015 a change of -4.88%

3/10/2019 FTSE Closed at 7077 points. Change of -0.63%. Total value traded through LSE was: £ 5,404,760,567 a change of -16.8%

2/10/2019 FTSE Closed at 7122 points. Change of -3.23%. Total value traded through LSE was: £ 6,496,135,228 a change of -7.41%

1/10/2019 FTSE Closed at 7360 points. Change of -0.65%. Total value traded through LSE was: £ 7,016,145,513 a change of 8.13%

 

#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.

For now, we lack optimism.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
10:11:02PM	BRENT	57.97									‘cess
10:14:30PM	GOLD	1506.17	1488	1482.71	1470.42	1498	1510	1516.75	1521	1494
10:18:20PM	FTSE	7145.65									‘cess
10:23:42PM	FRANCE	5457.7
10:25:42PM	GERMANY	11974									‘cess
10:36:39PM	US500	2894									‘cess
10:42:07PM	DOW	26186	26152	26120.5	25941	26335	26383	26435.5	26536	26232	Success
10:48:35PM	NASDAQ	7613									Success
10:50:45PM	JAPAN	21330									‘cess

8/10/2019 FTSE Closed at 7143 points. Change of -0.75%. Total value traded through LSE was: £ 5,250,871,756 a change of -5.63%

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.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:11:19PM	BRENT	58.33									Success
9:14:49PM	GOLD	1492.67	1487	1477	1471	1504	1507	1512.5	1521	1496	‘cess
9:24:52PM	FTSE	7191.68									‘cess
9:49:53PM	FRANCE	5512.2									‘cess
9:55:33PM	GERMANY	12072									‘cess
10:01:32PM	US500	2937.17
10:03:55PM	DOW	26470.9
10:06:17PM	NASDAQ	7727.12	7675	7667	7626	7760	7788	7830	7883	7675
10:08:28PM	JAPAN	21475

 

 

7/10/2019 FTSE Closed at 7197 points. Change of 0.59%. Total value traded through LSE was: £ 5,564,169,791 a change of 8.23%

#Brent #DAX It proved one of these “you don’t get out much?” weekends. An issue from living in the Scottish Highlands is lack of variety when it comes to shops. A visit to the mainland gave an excuse for a side trip into a Lidl store. They don’t appear to be listed on the markets or we’d be enthusiastically covering them today.

Never having visited this chain before, it proved a fascinating jaunt, one which ended with a set of axle stands, an electric sander, work dungarees, and of course, a packet of wire cutters. Also purchased was the item which gave an excuse for a visit, cheap peanut butter for the dog (an easy way to sneak medication to animals). Getting ready to give our little red tractor its annual service, this exquisite Aladdin’s cave of useful junk provided an excellent starter with the prices of the non food haul quite extraordinary. Hopefully the axle stands don’t collapse while I’m lying under the tractor arguing with its clutch!

Something else, also important, happened in the last few days.

The chart below has a little circle though the DOW JONES uptrend for 2019. We’ve also shown the movement as an inset as we fear it’s liable to prove important. This sort of thing we refer to as a warning sign, a clear signal an important trend can be broken. Often, when this sort of thing occurs, any movement below the trend is usually sharp, fast, and painful.

At present, the implication is we should use 26,078 as final straw.

Essentially, weakness on the DOW below this level is liable to provoke sharp reversal down to an initial 24,867 points. If broken, secondary is a longer term 23,536 points. Generally, these circled trend breaks imply reversal should occur due to some sort of negative news and worse, if our initial target is achieved, ultimately there’s a heck of an argument favouring “bottom” at 22,206 points eventually. In terms of the important question, “If I go short, where’s the stop?”, the answer is pretty straightforward; as tight as possible. The drop, if it happens, will tend not form part of a trading cycle.

What’s surprising about this scenario is the suggestion the market could be poised to reverse all movement during 2019 and ponder if Mr Trump is planning to Tweet something outrageous in the weeks ahead. Who knows, maybe he shall announce his undying love for the UK’s Mr Johnstone, just before executing a ban on all trade with the UK…

All kidding aside, there is ‘something’ about the DOW’s movement in recent month which, if it were a share price, would leave us uncomfortable.

To get out of trouble, the DOW need only exceed 26,630 to give the first hint we’re being panic merchants. As it closed last week at 26,573, it’s not a big ask.

Above 26,630 is supposed to trigger movement up to an initial 27,076 points. If exceeded, our secondary is at an amazing looking 28,285 points and the territory of new all time highs. The first major challenge, of course, shall be the question as to whether sufficient strength exists to achieve the 27,076 level. If it does, the circled break below Red shall be consigned to history as a false alarm.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
5:24:08PM	BRENT	58.43	57.58	57.11	56.53	58.44	58.85	59.065	59.56	57.97	‘cess
5:25:49PM	GOLD	1505.05
5:28:00PM	FTSE	7172.97									‘cess
8:39:16PM	FRANCE	5503.7									‘cess
8:41:28PM	GERMANY	12065.26	11914	11880	11816	12002	12070	12094	12186	12001	‘cess
8:43:12PM	US500	2952.42									Success
8:46:19PM	DOW	26568									Success
8:52:59PM	NASDAQ	7756.62									Success
8:55:09PM	JAPAN	21533									‘cess

4/10/2019 FTSE Closed at 7155 points. Change of 1.1%. Total value traded through LSE was: £ 5,141,232,015 a change of -4.88%

#FTSE #Nasdaq Despite the nation being notorious cheats (at sport) Australia, boasts a stock market which pretty well plays by the rules. Unfortunately, the last few days saw the market climb to 6850 derailed, probably just delayed, as the rest of the world decided something had spooked the markets. We’re not entirely confident the gates of hell actually have opened.

At times, things felt like; “the Saudi Oil Panic didn’t work, let’s try something else to slow things down!” This, of course, would be utterly ridiculous, would it not?

In the case of Australia and its ASX200 index, the market need only exceed 6555 points (6502 at time of writing) to give the first suggestion of bottom being “in”. Such a miracle allows a surprise recovery cycle to an initial 6697 points. If exceeded, secondary is at 6800 but, the big picture almost demands the market top out at 6850 points.

This is why we like Australia, thanks to the usual integrity of movements. If the index ever closes above 6850 points, a Big Picture cycle is expected to commence toward a long term 8825 points!

For now, we shall not be entirely aghast if it finds an excuse to bottom around the 6443 point.

FTSE for FRIDAY Closing the session at 7078 points, we shall be quite interested if the UK index manages above 7128 on Friday. This is liable to be significant, allowing recovery toward an initial 7184 points with secondary, if bettered, at 7214 points.

Our emergency commentary in our previous report proved worthwhile, if somewhat weird. We’d suggested the market would probably bottom at 7027. For those willing to cross their fingers and enter at such a level with a Long, we’d proposed a stop down at 6982 points. The market hit our target, bounced a little, dropped below target, bounced and again reversed to target. Then bounced properly to 7100 points. All it now needs is above 7128 and we’ll start to suspect bottom have been achieved – for now.

Remember, of course, the UK has a secret volatile weapon called Boris, capable of havoc.

Below 6982 points risks reversal in the near term down to 6950 points. If broken, secondary is at 6900 but to be realistic, it could drop further to a “must bounce” bottom at 6750 points.

On the chart, we’ve painted a Red uptrend. In honesty, we doubt uptrends or downtrends for the near term hold any real meaning at present.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
10:05:01PM	BRENT	57.54									‘cess
10:08:17PM	GOLD	1505.77									Success
10:14:33PM	FTSE	7125.08	7003	6979.5	6929	7099	7130	7156	7207	7060	‘cess
10:17:28PM	FRANCE	5466.5									Shambles
10:19:37PM	GERMANY	11980.2									Shambles
10:23:00PM	US500	2913.02									‘cess
10:26:55PM	DOW	26216.2									‘cess
10:51:36PM	NASDAQ	7646.62	7459	7430	7358	7576	7650	7658.5	7687	7569	‘cess
10:53:55PM	JAPAN	21353									Success

 

3/10/2019 FTSE Closed at 7077 points. Change of -0.63%. Total value traded through LSE was: £ 5,404,760,567 a change of -16.8%

#DOW #BRENT ‘Pennyworth’, an absurd TV ’60’s drama, remains “on point”, their fictional English Queen asking how to remove the PM the same week it was reported the real Queen was doing the same. Following the Brexit vote and Boris’s leave campaign, the FTSE dropped by 550 points. Unlike 2nd Oct, that particular movement was quite artificial as the action happened in the opening seconds of the day with share prices lowered to provide attractive entry points.

This time, the FTSE feels like more relaxation’s ahead. After all, the volatility was “only” 240 points and matched sessions in both Feb & Dec last year.

The immediate bottom line is of weakness below 7119 suggesting coming travel down to an initial 7053 points. If broken, secondary is at 7027 points and a level where the index almost must rebound. If chasing a bounce from this target level, the tightest stop calculates at 6982 points, so ensure clean underwear is available!

There’s a very real problem if 6982 breaks. The market will achieve a series of “lower lows” and stumble into territory with a, hopefully, ultimate bottom intention at 6730 points. We can, of course, calculate lower but have considerable trouble reaching below 6600 points. Just for a giggle, we drew the uptrend since the market crash of 2009 and guess what, it intersects with the 6,600 ambition anytime soon. Hopefully this shall just prove coincidence.

Usually a hysterical fall such as experienced is matched by a rise the following day. Given the state of market futures this evening, we’re far from confident this shall be the case. The index closed the session at 7127 points, needing above 7154 to hint a rise may prove real. In such an event, our initial target is at 7194 points with secondary, if bettered, a more useful sounding 7238 points.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
10:15:41PM	BRENT	57.54	57.16	56.68	54.23	59.6	59.44	60.235	61.26	58.2	‘cess
10:18:11PM	GOLD	1500.12									Success
10:31:23PM	FTSE	7106									Success
10:35:05PM	FRANCE	5421.2									Success
10:40:02PM	GERMANY	11916.4									Success
10:53:13PM	US500	2885.67									Success
10:58:02PM	DOW	26078	25960	25810	25652	26161	26236	26261.5	26362	26027	Success
11:01:04PM	NASDAQ	7545.27									Success
11:03:52PM	JAPAN	21374									Success

2/10/2019 FTSE Closed at 7122 points. Change of -3.23%. Total value traded through LSE was: £ 6,496,135,228 a change of -7.41%

#France #Nasdaq We moan, every month, when trying to write something useful about the UK’s retail banks. Now, the discovery of something worse has brought a surprising level of cheer. When a key component to mans survival fails, a sharp reminder of what’s important in life is quickly delivered. In the interests of transparency, I’ve “form” with dishwashers, recently going through two replacements in a single year!

This time, the problem was rather more than simply sharing a house with the devils machine. Instead, an ill advised attempt to clean spray nozzles completed with a disaster of broken bits of plastic. Apparently a YouTube video with instructions for Electrolux did not mean a Bendix machine was the same. Between the kitchen and computer, I forgot the make of current washer. Thoughts on Lloyds Bank subsided while trying to glue and clamp a myriad of parts together again. Finding the manual, once I’d completed damaging the machine, proved the final humiliation. It even provided pictorial instructions.

Lloyds share price, alas, is something without pictorial instruction…

When we last reviewed Lloyds (link), we proposed a movement to 54p, something successfully achieved and even exceeded. Alas, the share price is treating this target level as something important, surfing above and below the 54p level while awaiting some sort of guideline for the future.

At this point, people increasingly write “Thanks, Boris” as explanation for confusion.

All joking aside, the share price has returned, miraculously, above the long term uptrend. In normal times of sanity, this is a “drop dead obvious” signal which points at real recovery but in this case, we’re not sold. Instead, there’s a very real danger of weakness now below 53.2p leading to an initial 51p. This returns the share below the trend, allowing a secondary of 48p but realistically, if powered by negative sentiment, Lloyds could now hit 43.4p in a blink.

For Lloyds to clamber out of trouble, it needs above 54.8 as this should power an initial 57.8p with secondary, a game changing (hopefully) 61p. Alas, at present we suspect it intends 48p next.

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	PriorFUTURES
10:19:47PM	BRENT	59.18									‘cess
10:22:52PM	GOLD	1479.75									‘cess
10:26:26PM	FTSE	7325.79									Success
10:41:46PM	FRANCE	5586	5578	5541.5	5487	5606	5620	5626.25	5633	5581	Shambles
10:50:51PM	GERMANY	12251									Success
10:52:55PM	US500	2942.47									Shambles
10:55:02PM	DOW	26588									Success
10:56:36PM	NASDAQ	7694.6	7673	7625	7559	7736	7742	7767.5	7799	7709	‘cess
10:59:02PM	JAPAN	21678									Success

 

1/10/2019 FTSE Closed at 7360 points. Change of -0.65%. Total value traded through LSE was: £ 7,016,145,513 a change of 8.13%