Category Archives: US Oil

Trading Room – 9th May, 2017

Today’s Trading Room looks at US Oil, Copper, CVX and $USB.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Elliott Wave Gold members were advised to enter short for US Oil on the 12th of April, at 53.11. Positions are now very profitable and stops have been moved down to protect profits.

Analysis is now focused on managing short positions and determining when to take profit.

Price has bounced up from support about 43.6. The candlestick at the low is a hammer and this shifts the trend from down to neutral. A reversal pattern reverses from down (or up) to either the opposite direction or neutral but makes no comment on how long the next trend may last.

The hammer is followed by a long legged doji. This indicates a balance between bulls and bears; neither are in charge. This looks like a pause within a larger trend and not necessarily a reversal.

The downwards trend has support from volume. ADX indicates a downwards trend that is not yet extreme. The trend has a healthy increase in range and widening of Bollinger Bands.

When Oil trends, it can do so very strongly. Indicators may remain extreme for long periods of time. Only when RSI has reached oversold for some time and ADX is extreme may this trend end.

In the short term, On Balance Volume is a little bullish. The break above the short purple line is a weak signal because the line is not long held and only tested three times. On Balance Volume may find resistance at the longer purple line and that may help to halt the rise in price here.

To see how extreme RSI and ADX can get when Oil trends look at the strong downwards wave from 13th June, 2014, to the 29th January, 2015.

US Oil Chart Daily 2017
Click chart to enlarge.

This chart looks at several examples during a strong trend in Oil to illustrate the concept of hammer candlestick reversal patterns not necessarily signalling the end of a trend. The biggest retracement was after the first pattern: the following two days retraced 54% of the prior fall. Thereafter, hammers were followed by zero to four days of upwards movement.

The lesson here is do not read too much into this one piece of technical analysis. On its own a hammer will more often be a sign of a pause and not a sign of a major low.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

This third wave for minuette wave (iii) must move below the end of minuette wave (i) at 47.06, to meet the core Elliott wave rule, and it must move far enough below this point to allow room for a subsequent fourth wave to unfold and remain below first wave price territory.

Minor wave C must subdivide as a five wave impulse. It has begun with two deep and very time consuming second wave corrections for minute wave ii and minuette wave (ii). The upcoming fourth wave corrections for minuette wave (iv) and minute wave iv may be expected to be relatively shallow to meet the guideline of alternation.

A narrow best fit channel is added to recent downwards movement. Price may be beginning to break below the lower edge as momentum increases. Micro wave 4 may not move into micro wave 1 price territory above 48.22. Targets remain the same.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Analysis of Copper is proving very difficult.

Corrections are deep. Overall, since the high on the 13th of February Copper has made a series of lower lows and lower highs.

Volume is stronger for downwards days, supporting the downwards movement in price.

ADX indicates Copper may be in the early stages of a downwards trend. The trend has not yet begun to show an increase in volatility but has begun possibly to show some small increase in range.

Price is whipsawing from support to resistance and back again in conjunction with Stochastics moving from oversold to overbought. Currently, with Stochastics in oversold territory, it seems reasonable for price to be expected to move higher here to find resistance now about 2.55. If price closes above 2.55, then next resistance would be about 2.700.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The last two complete monthly candlesticks both have long lower wicks, which is bullish.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

Leading diagonals in first wave positions are normally followed by very deep corrections, often reasonably deeper than the 0.618 Fibonacci ratio. Given this tendency and the brevity of the correction labelled minute wave a within minor wave 2, it looks most likely that minor wave 2 shall continue for longer and be deeper.

Minor wave 2 may not move beyond the start of minor wave 1 above 2.823.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

CVX – Chevron Corp

TECHNICAL ANALYSIS – WEEKLY

CVX Chart Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The larger trend may still be up and should be assumed to remain so while price is above 95.64.

However, the current smaller movement looks to be down and has more support from volume.

A break below the long term purple line by On Balance Volume would be a bearish signal.

TECHNICAL ANALYSIS – DAILY

CVX Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

CVX has been in a downwards trend since December 2016. This may be a large pullback within a bull market as seen on the weekly chart. Short and mid term averages have a negative slope. The long term 200 day average still has a slight positive slope.

Within the downwards trend are periods of consolidation. Currently, a small consolidation is unfolding and the strongest day is a downwards day, so expect a downwards breakout as more likely than upwards here.

Overall, this chart is neutral to slightly bearish.

This analysis of Chevron is included in Trading Room today as a result of a member’s request and not necessarily because it offers a good trading opportunity. It may offer an opportunity to short but only for more experienced and nimble members; this trend is not strong.

$USB – 30 YEAR US TREASURY BONDS

TECHNICAL ANALYSIS – MONTHLY

USB Chart Montly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

This chart looks at 20 years of data.

Bond price has remained bullish for this time. Pullbacks find final support at the 10 year moving average (dark blue). Some pullbacks fall short, finding support about the 5 year moving average (purple).

For this market to be confirmed as having switched from bull to bear, the major swing low in December 2013 should be exceeded by a new low below 127.30. Assume the bull market remains intact while price remains above 127.30.

Often at lows Stochastics exhibits divergence with price.

There is room here for price to fall further. However, with Stochastics turning up here it is also possible that the fall in price is over. The weekly chart may shed more light.

TECHNICAL ANALYSIS – WEEKLY

USB Chart Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Since early July 2016, Bonds have been in a pullback within the context of a larger bull market.

Strong bullish divergence between the last two swing lows for price and RSI and Stochastics indicates downwards movement has weakened. A low may be in place.

ADX does not indicate a change from down to up nor does it indicate a trend at this time.

This analysis suffers from a lack of volume data.

At this time, it looks reasonable to assume this may be a good buying opportunity for longer term investors. Always have an exit strategy for long term investments that includes at what point the investment would be exited if price falls. Do not invest funds which you cannot afford to lose.

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

This table ends April.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

To learn what the Trading Room is about see first Trading Room analysis here.

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

Trading advice will be updated throughout the week for Elliott Wave Gold members only in this comments section.

This analysis is published @ 02:18 a.m. EST.

[Note: Member comments and discussion will remain private.]

Continue reading Trading Room – 9th May, 2017

Trading Room – 23rd April, 2017

Today’s Trading Room looks at Copper and US Oil.

Only a recommendation on Gold is given for Elliott Wave Gold members.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

On the 12th of April Copper had a classic downwards breakout from a consolidation zone, which was supported by volume.

A resistance line is added this week in green. Price might find some resistance at this line, but at this stage the line does not offer good technical significance because it is steep and not long held.

Looking back over the last 2 years, horizontal support and resistance lines are added. Price may find some resistance here about 2.55.

The long lower wick on the candlestick for the 20th of April is bullish. Now the relatively long upper wick on the 21st of April is a little bearish. This upwards movement looks like another small bounce and this view is supported by declining volume.

On Balance Volume is again bearish, turning down from the purple line.

There is a downwards trend which is not extreme.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The doji candlestick for February puts the trend from up to neutral.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The blue channel continues to show about where price may find resistance and support. If this Elliott wave count is correct, then Copper should break through support at the lower edge of the channel and then increase in downwards momentum.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Elliott Wave Gold members were advised to enter short for US Oil on the 12th of April, at 53.11. Positions are now comfortably profitable and stops have been moved down to protect profits.

Analysis is now focused on managing short positions and determining when to take profit.

Downwards movement has some support from volume. ADX is bearish. ATR increasing supports the trend. On Balance Volume is very bearish.

With RSI and Stochastics not yet oversold, there is room for price to fall further.

US Oil can close outside the extreme range of Bollinger Bands for several days in row when it has a strong trend. With a close two days in a row below the lower edge of Bollinger Bands, this is not a concern.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

This third wave for minuette wave (iii) must move below the end of minuette wave (i) at 47.06, to meet the core Elliott wave rule, and it must move far enough below this point to allow room for a subsequent fourth wave to unfold and remain below first wave price territory.

Minor wave C must subdivide as a five wave impulse. It has begun with two deep and very time consuming second wave corrections for minute wave ii and minuette wave (ii). The upcoming fourth wave corrections for minuette wave (iv) and minute wave iv may be expected to be relatively shallow to meet the guideline of alternation.

A narrow best fit channel is added to recent downwards movement. An upcoming correction for subminuette wave ii may breach the channel. At this stage, with the power of a third wave pulling to the downside, subminuette wave ii may be expected to be relatively brief and shallow.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

Trading advice for gold given to Elliott Wave Gold members will be included in Trading Room summary tables. However, so that it remains private for Elliott Wave Gold members only, it will not be included in Trading Room posts.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

Each month a new “closed positions” table will begin. To see all closed positions for March 2017 see the last Trading Room post for March here.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

The technical problem with comments encountered last week has now been fixed. Members should log into the website then click on the title of this post to see comments.

Trading advice will be updated throughout the week for Elliott Wave Gold members only in this comments section.

This analysis is published @ 10:00 p.m. EST.

[Note: Member comments and discussion will remain private.]

Continue reading Trading Room – 23rd April, 2017

US OIL Elliott Wave Technical Analysis – 19th April, 2017

A break below the small best fit channel on the daily chart indicated a trend change for US Oil.

Members were then advised to enter a short position. Short positions are now positive.

Summary: The target is at least a new low below 47.06; it should be comfortably below that point.

New updates to this analysis are in bold.

MONTHLY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Monthly 2016
Click chart to enlarge.

Within the bear market, cycle wave b is seen as ending in May 2011. Thereafter, a five wave structure downwards for cycle wave c begins.

Within cycle wave c, at this stage it does not look like primary wave 5 could be complete. That would only be possible if primary wave 4 was over too quickly.

Primary wave 1 is a short impulse lasting five months. Primary wave 2 is a very deep 0.94 zigzag lasting 22 months. Primary wave 3 is a complete impulse with no Fibonacci ratio to primary wave 1. It lasted 30 months.

Primary wave 4 is likely to exhibit alternation with primary wave 2. Primary wave 4 is most likely to be a flat, combination or triangle. Within all of these types of structures, the first movement subdivides as a three. The least likely structure for primary wave 4 is a zigzag.

Primary wave 4 is likely to end within the price territory of the fourth wave of one lesser degree; intermediate wave (4) has its range from 42.03 to 62.58.

If primary wave 4 is incomplete, then it looks like it may not remain contained within the channel. Sometimes fourth waves overshoot channels and this is why Elliott developed a second technique to redraw the channel when it does not contain a fourth wave.

Primary wave 4 is most likely to be shallow to exhibit alternation in depth with primary wave 2. So far it has passed the 0.382 Fibonacci ratio at 45.52. It may now continue to move mostly sideways in a large range.

Primary wave 4 may not move into primary wave 1 price territory above 74.96.

At this stage, primary wave 4 has completed intermediate wave (A) only. Intermediate wave (B) is incomplete.

WEEKLY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Daily 2016
Click chart to enlarge.

The whole structure of primary wave 4 is seen here in more detail.

The first wave labelled intermediate wave (A) is seen as a double zigzag, which is classified as a three.

Intermediate wave (B) is also a three. This means primary wave 4 is most likely unfolding as a flat correction if my analysis of intermediate wave (A) is correct. Flats are very common structures.

Intermediate wave (B) began with a zigzag downwards. This indicates it too is unfolding most likely as a flat correction.

Within intermediate wave (B), the zigzag upwards for minor wave B is a 1.29 correction of minor wave A. This indicates intermediate wave (B) may be unfolding as an expanded flat, the most common type.

The normal range for intermediate wave (B) within a flat correction for primary wave 4 is from 1 to 1.38 the length of intermediate wave (A) giving a range from 26.06 to 16.33.

Primary wave 4 may not move into primary wave 1 price territory above 74.96.

Within the larger expanded flat correction of primary wave 4, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 28.61 or below.

DAILY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Daily 2016
Click chart to enlarge.

Minor wave C downwards must subdivide as a five wave structure.

Within minor wave C, minute waves i and ii should be complete and minute wave iii must be incomplete. Upwards movement, which is labelled minuette wave (ii), cannot be minute wave iv as it overlaps back into minute wave i price territory.

Within minute wave iii, minuette wave (i) is complete and minuette wave (ii) now looks most likely to be over.

A small best fit channel is drawn about the zigzag of minuette wave (ii). This channel is now breached providing trend channel confirmation of a trend change. This wave count would now expect an increase in downwards momentum.

Minuette wave (iii) must make a new low below the end of minuette wave (i) at 47.06. It must move far enough below that point to allow for subsequent upwards movement for minuette wave (iv) to unfold and remain below minuette wave (i) price territory.

Within minuette wave (iii), no second wave correction may move beyond the start of its first wave above 53.76.

The cyan trend line is drawn from the high labelled minor wave B to the next swing high labelled minute wave ii. This is a Magee trend line for a bear market. Expect that US Oil is most likely in a downwards trend as long as price remains below this cyan trend line.

TECHNICAL ANALYSIS

DAILY CHART

US Oil Chart Daily 2015
Click chart to enlarge. Chart courtesy of StockCharts.com.

The candlestick of the 12th of April completes a Bearish Engulfing Candlestick reversal pattern. The important condition for this pattern (where the close of the second candlestick is below the open of the first) is met. This is one of the most reliable reversal patterns. It works more often than not, but not always. An example of it not working is shown on the 3rd of April.

The reversal pattern of the 12th of April has support from volume whereas the 3rd of April did not. This increases the probability that price may reverse here.

The long lower wick on the last daily candlestick for the 18th of April is bullish, as is stronger volume to support upwards movement of price during the session (indicated by On Balance Volume moving higher for this session). This bounce may move a little higher.

New trend lines are drawn on On Balance Volume. These do not yet have good technical significance, so a breach here would be only a weak signal.

VOLATILITY INDEX

OVX Chart Daily 2015
Click chart to enlarge. Chart courtesy of StockCharts.com.

Normally, volatility should decline as price rises and volatility should increase as price falls. Divergence from this normal can provide a bullish or bearish signal for Oil.

For the last session, here dated the 18th of April, volatility has declined below the 11th of April but price has not made a new high. This divergence is bearish and supports the idea of a trend change here for Oil.

This analysis is published @ 03:07 a.m. EST.

[Note: Analysis is public today for promotional purposes. Member comments and discussion will remain private.]

Continue reading US OIL Elliott Wave Technical Analysis – 19th April, 2017

Trading Room – 17th April, 2017

Today’s Trading Room looks at Copper, US Oil and GBPUSD.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Members were advised to enter short on the 10th of April. Stops were initially set just above 2.700 and are now moved down to breakeven to eliminate risk.

On the 12th of April Copper had a classic downwards breakout from a consolidation zone, supported by volume. Now price is turning up to test resistance at prior support, about 2.590. The downwards session for the 12th of April has strong volume. The last upwards session for the 13th of April has lighter volume. Volume is bearish.

The long upper wick on the candlestick for the 13th of April is bearish.

On Balance Volume is bearish. RSI is not extreme, so there is plenty of room for price to fall. ADX is still below 15 and does not yet indicate a new trend. Bollinger Band expansion indicates volatility returning after the consolidation; with price moving lower as Bollinger Bands expand, this is bearish.

ATR may be expected to begin to increase after a period of a small range.

Stochastics is not yet oversold. This may remain extreme for long periods of time during a trending market. Only when it has been extreme for some time and then exhibits divergence with price while extreme should it be read as a strong warning sign of an impending trend change. That is not the case yet.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The doji candlestick for February puts the trend from up to neutral.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The upper edge of the blue channel has still provided resistance, with a strong overshoot for the 30th of March. Copper may in the early stages of a third wave at three degrees now and this should see an increase in downwards momentum.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The red daily candlestick of the 12th of April completes a Bearish Engulfing Candlestick pattern. This is the most reliable of candlestick reversal patterns when it comes after an upwards trend. It doesn’t always work (it didn’t work on the 3rd of April), but it works more often than not. It is supported by volume. The last upwards day for the 13th of April did not have support from volume. This is also bearish.

Overall, this chart is more bullish than bearish.

Members were advised that I entered short Oil on the 12th of April. At this stage, this position is now positive.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

The basis for entering short was price breaking below the lower edge of the small gold channel that contains the upwards wave labelled minuette wave (ii).

Now price may be beginning to move down and away.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

GBPUSD

TECHNICAL ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The prior pennant pattern is no longer correct.

The last daily candlestick for the 13th of April is bearish and has support from volume.

ATR and Bollinger Bands show there is something wrong with this upwards trend due to a lack of range and volatility. This trend is relatively weak at this stage.

VOLUME ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge.

The bearish signal given in last analysis for On Balance Volume was negated. The support line is redrawn. On Balance Volume is constrained, giving no signal today.

ELLIOTT WAVE ANALYSIS

GBPUSD Chart Monthly 2017
Click chart to enlarge.

Cycle wave c needs to complete as a five wave structure. The final fifth wave is incomplete and may only have just begun. The target expects to see the most likely Fibonacci ratio between primary waves 5 and 1.

GBPUSD Chart Daily 2017
Click chart to enlarge.

Primary wave 4 fits perfectly as a regular contracting triangle, offering perfect alternation with the zigzag of primary wave 2. Primary wave 2 lasted 2 months and primary wave 4 lasted 6 months. Triangles are usually longer lasting structures than zigzags, so this disproportion is not only acceptable but should be expected. This wave count has the right look.

The breakout from the triangle should be down.

Minor wave 2 moved higher and fits perfectly as an expanded flat correction. These are very common structures. The choice to try another short position here is based heavily on the three wave structure of minute wave b; with a three down following minor wave 1, only an expanded flat following an impulse will fit. The trend should therefore be down if this Elliott wave analysis is correct.

Minor wave 2 may not move beyond the start of minor wave 1 above 1.26157.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

Trading advice for gold given to Elliott Wave Gold members will be included in Trading Room summary tables. However, so that it remains private for Elliott Wave Gold members only, it will not be included in Trading Room posts.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

Each month a new “closed positions” table will begin. To see all closed positions for March 2017 see the last Trading Room post for March here.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

Members will be updated with trading advice over the next week here in comments for Trading Room. Comments are therefore private, for members only.

This analysis is published @ 03:39 a.m. EST.

[Note: Member comments and discussion will remain private.]

Continue reading Trading Room – 17th April, 2017

US OIL Elliott Wave Technical Analysis – 12th April, 2017

Again, last week expected downwards movement from US Oil but price continues higher. The main Elliott wave count was invalidated leaving only one wave count now, which was last week’s alternate.

Continue reading US OIL Elliott Wave Technical Analysis – 12th April, 2017

US OIL Elliott Wave Technical Analysis – 4th April, 2017

Price has moved higher over the last few days.

Continue reading US OIL Elliott Wave Technical Analysis – 4th April, 2017

US OIL Elliott Wave Technical Analysis – 28th March, 2017

Price is now moving sideways again. Some strategies for traders are outlined today.

Continue reading US OIL Elliott Wave Technical Analysis – 28th March, 2017

Trading Room – 27th March, 2017

Today’s Trading Room looks at Copper, US Oil and FTSE.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Copper has made a series of lower lows and lower highs (the definition of downwards movement) since the 13th of February. This downwards movement is choppy and overlapping though.

The very short term suggests volume may provide support for a little more upwards movement. If the trend is down, then price should not make a new high above 2.700.

Long lower wicks on the last three daily candlesticks also looks bullish for the short term.

On Balance Volume gives a bearish signal on the 23rd of March, which should be given reasonable weight.

With low ADX and ATR, there is plenty of room for a new trend to develop.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The lower edge of the gold channel did provide support; price bounced up from there. The upper edge should provide resistance.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The trend is not yet extreme. There is room still for it to continue. When Oil trends strongly, ADX can remain above 35 and above both directional lines for several days before the trend ends.

There is some concern today that the next movement down is not yet underway. The correction which price moved into on the 15th of March may still be underway. Slight divergence at the last low between Stochastics and price, and RSI and price, looks slightly bullish. The long lower wick on the candlestick for the 22nd of March looks bullish.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

If the Elliott wave count is correct, then the correction should be over. If it were to continue, then it would be grossly disproportionate to subminuette wave ii.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

FTSE

TECHNICAL ANALYSIS

FTSE Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Assume the trend remains the same until proven otherwise. The trend is up at this stage, so corrections present an opportunity to join the trend.

FTSE Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

While the longer term trend looks clear, the shorter term trend is not so clear. This can often be the case at the end of corrections within a larger trend.

Divergence with price and RSI, and Stochastics, indicates weakness at highs. This indicates caution for long positions. There is a level of risk here that is not small.

ELLIOTT WAVE ANALYSIS

FTSE Chart Monthly 2017
Click chart to enlarge.

The normal range for cycle wave b is from 1 to 1.38 the length of cycle wave a. The structure of cycle wave b is close to completion. If cycle wave b reaches twice the length of cycle wave a, the wave count should be discarded based upon an extremely low probability. That point is above 10,624.

FTSE Chart Weekly 2017
Click chart to enlarge.

The weekly chart shows all of intermediate waves (A)-(B)-(C). The structure is an incomplete zigzag. The daily chart below shows all of minor wave 5 within intermediate wave (C).

FTSE Chart Daily 2017
Click chart to enlarge.

Minor wave 5 is unfolding as an impulse and its structure is incomplete. Within minor wave 5, minute wave v may be extending. There is no Fibonacci ratio between minute waves i and iii, so it is more likely that minute wave v will exhibit a Fibonacci ratio to either of minute waves i or iii.

Within the middle of the third wave, micro wave 2 may not move beyond the start of micro wave 1 below 7,263.62. However, the probability of this wave count would substantially reduce if the green channel is breached before this price point is passed.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

This analysis is published @ 01:25 a.m. EST.