Tag Archives: natural gas
Trading Room – 9th April, 2017
Today’s Trading Room looks at Copper, Natural Gas 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
Click chart to enlarge. Chart courtesy of StockCharts.com.
Last Trading Room advice to Elliott Wave Gold members advised to enter short with a stop just above 2.717. Members were advised that short positions should become profitable within 24 hours, which is what happened, and that stops should have been then moved to breakeven. The whipsaw of the 5th of April should have closed short positions for no loss.
Copper is now range bound with resistance about 2.70 and support about 2.59 (with overshoots). Volatility declines as price moves sideways, ATR remains very low and flat, and ADX indicates a consolidating market.
In the short term, the very long lower wick for the candlestick of the 7th of April indicates upwards movement is likely to begin the new trading week.
TREND LINE
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
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The upper edge of the blue channel has provided resistance, with a strong overshoot for the 30th of March. Copper may be ready to move lower in 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.]
Natural Gas
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Last trading advice for Natural Gas to Elliott Wave Gold members on the 31st of March was:
“A trade set up is not seen at this time. Look for price to pullback to touch the green Magee trend line on the TA chart. If that happens, then enter long with a stop just below the line. Allow for overshoots, but exit long positions if the line is breached.”
The Magee trend line was touched again on the 4th of April. This was the signal to enter long according to trading advice given. That best case entry point would have been at the low of the day at 3.122, but in reality members may not have entered exactly at the price point where price touched the line. However, any long positions should now be profitable and stops may be moved up to protect a little profit.
The Magee trend line may be used now as a trailing stop for long positions.
ADX indicates an upwards trend and RSI allows further room for price to rise. Stochastics is overbought and exhibits divergence with price, but this oscillator may remain extreme for long periods of time when this market trends. The bottom line is any pullbacks may be expected to find support at the green Magee trend line.
On Balance Volume is now bound within a small range. Watch this carefully; if it breaks below the yellow support line, it would indicate a deeper pullback may be underway; if it breaks above the purple resistance line, it would indicate an increase in upwards momentum.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The last Elliott wave count was invalidated with a new high this week above 3.174. Cycle wave b may be continuing higher as a double zigzag.
Click chart to enlarge.
MACD indicates an increase in momentum to support this third wave up.
When minor wave 3 is complete, then minor wave 4 may not move into minor wave 1 price territory below 3.088.
The gold channel’s lower edge is the same as the green Magee trend line on the daily technical analysis chart. Price should continue to find support at the lower edge while minor wave 3 continues.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
GBPUSD
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Price looked like it was forming a Pennant pattern. What StockCharts data does not show today is the daily candlestick for the 7th of April that broke out of the pattern to the downside. The candlestick is shown today on FXCM data below.
VOLUME ANALYSIS
Click chart to enlarge.
On Balance Volume gives a bearish signal with a break below the short term yellow support line. The downwards breakout from the pennant pattern has support from volume for a strong downwards day.
ELLIOTT WAVE ANALYSIS
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.
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.
Within minor wave 3, no second wave correction may move beyond the start of its first wave above 1.25620.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
TRADING ROOM SUMMARY TABLES
OPEN POSITIONS
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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
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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.
This analysis is published @ 06:48 p.m. EST.
Trading Room – 31st March, 2017
Today’s Trading Room looks at Copper and Natural Gas.
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
Click chart to enlarge. Chart courtesy of StockCharts.com.
The last trade for Copper was closed on the 27th of March.
Now Copper has moved higher.
The long lower wick of the 27th of March is bullish. Now the long upper wick of the 30th of March is bearish. A reasonable expectation would be for Copper to print at least one red daily candlestick next.
Strong volume for a session with the balance of volume downwards supports downwards movement.
On Balance Volume may find some support at the yellow trend line, but this line does not have much technical significance as it is steep and only tested twice before. The purple line does offer reasonable significance, so this may halt a fall in price.
Copper is range bound with resistance about 2.700 and support about 2.560. During this range bound period, it is two downwards days that have strongest volume suggesting a downwards breakout is more likely than upwards.
TREND LINE
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
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The upper edge of the blue channel has provided resistance, with a strong overshoot for the 30th of March. Copper may be ready to move lower in a third wave at two degrees 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.]
Natural Gas
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Natural Gas is now in an upwards trend. The breach of the blue bear Magee trend line indicated a trend change from bear to bull.
Now a new trend line is drawn for the new bull trend in green, so expect corrections to find support at this line. If it is breached, it would indicate a change.
Next resistance is about 3.550.
There is strong volume for upwards movement in recent sessions. The new trend has support from volume.
On Balance Volume is constrained within sloping lines. A breakout would be a bullish or bearish signal.
Stochastics can remain extreme for reasonable periods of time. With price sitting close to upper edge of Bollinger Bands and Stochastics exhibiting divergence with price at highs while extreme, it looks like in the short term a small pullback may unfold.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The last Elliott wave count was invalidated with a new high this week above 3.174. Cycle wave b may be continuing higher as a double zigzag.
Click chart to enlarge.
The downwards wave labeled primary wave X is now a complete structure. It fits best and looks most like a three wave movement.
Intermediate wave (B) may not move beyond the start of intermediate wave (A) below 2.522.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
TRADING ROOM SUMMARY TABLES
OPEN POSITIONS
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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
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Trades advised to Elliott Wave Gold members for Gold have now been included in Trading Room summary tables.
*FTSE was a weak recommendation. Advice was given to only invest 1-2% of equity on this trade.
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 @ 02:53 a.m. EST.
Trading Room Summary Tables – 15th March, 2017
This post updates recommendations made three days ago.
Continue reading Trading Room Summary Tables – 15th March, 2017
Trading Room Summary Tables – 14th March, 2017
This post updates recommendations made two days ago.
Continue reading Trading Room Summary Tables – 14th March, 2017
Trading Room – 13th March, 2017
Today’s Trading Room looks at Copper, US Oil, NGas, USD Index, EURBGP and USDJPY.
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
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Volume supports downwards movement. Copper has broken below support and is now trending down.
Lighter volume for the last upwards session is slightly bearish, as is the long upper wick. On Balance Volume is at resistance.
Two concerns: Price may yet move higher before it turns back down and ATR is still declining.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The invalidation point is not too far away. A small fourth wave correction may be complete.
The next wave down may exhibit some increase in momentum as it’s a fifth wave for a commodity.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
US Oil (WTI Crude – Spot)
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
RSI and Stochastics can remain extreme for reasonable periods of time when US Oil trends. Oversold conditions for these two indicators does not necessarily mean a low must be in place.
Very strong volume over the last three days supports downwards movement.
Sometimes after a breakout price curves back to retest prior support or resistance. It is possible here that US Oil may turn up for a test of resistance about 50.70. However, this does not always happen.
HOURLY CHART
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While price remains within this channel expect it to continue downwards. If the channel is breached, then a larger bounce may be underway.
ELLIOTT WAVE ANALYSIS
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A larger flat correction may be unfolding for a fourth wave (EWG members should refer to the US Oil monthly chart for the bigger picture here). Within a flat correction, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 28.61.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
Natural Gas
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
It is concerning that the Magee trend line is breached.
The last three daily candlesticks complete stalled pattern. The longer upper wick on the last candlestick is bearish. Declining volume for the last two upwards days is bearish.
On Balance Volume is bullish in that it is making strong new highs with price. There is some bearish divergence as noted.
Overall, it does look like this is a counter trend movement. But there is no indication it is over at this stage, so it may move higher.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The fourth wave is now very close to first wave price territory. If this portion of the wave count is correct, then there is very little room for NGas to move into. The target expects a long strong extended fifth wave, typical of commodities.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
USD Index
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
If there is a resumption of the larger upwards trend, then this next wave up is in its very early stages. In the short term, it looks like USD Index has made a relatively deep correction. Support is about 100.60. If price can break above resistance at 103, then next resistance is about 103.50.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The structure of primary wave 5 is still incomplete. If the current correction moves lower, it should find support at the lower edge of the trend channel. If that trend channel is breached, then the wave count would be in doubt.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
EURGBP
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
It looks like EURGBP is currently at resistance and may move into a small consolidation for a few days. This may bring Stochastics down from overbought. Price may find support about 0.8635.
It looks like there is a new upwards trend beginning.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The upwards movement should unfold as a three wave structure, so there should be downwards movement for minor wave B within it. If the target is wrong, it may be too low.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
USDJPY
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
This pair has proven tricky to find an entry. It is currently in a consolidation with resistance about 115.55 and support about 111.55.
The short term Fibonacci 13 day moving average has just crossed above the mid term Fibonacci 55 day moving average giving a bullish crossover.
RSI is not extreme. Stochastics is extreme, but this may remain extreme for long periods of time when this market trends.
VOLUME ANALYSIS
Click chart to enlarge.
Volume for the last three upwards days showed an increase to support the rise in price. The long upper wick on the last daily candlestick is bearish.
On Balance Volume is squeezed. A break above the purple resistance line would be a reasonable bullish signal. A break below the yellow support line would be a weak bearish signal.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
The structure of cycle wave III is still incomplete. The fifth wave up needs to unfold.
Trading advice for members only: [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.
TRADING ROOM SUMMARY TABLE
New to Trading Room is a simplified table to summarise Trading Room. (Thanks to our member Dreamer for the idea.)
Subsequent posts will add a separate table for Open Positions and when applicable a third table for Closed Positions.
[Content protected for Elliott Wave Gold members only. To subscribe click here.]
This analysis is published @ 03:20 a.m. EST.
Trading Room – 21st February, 2017
Today’s Trading Room looks at NGas, EURUSD, USDJPY and EURGBP.
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.
NGas
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Natural Gas continues lower as the last analysis expected. Today’s strong volume spike may be a selling climax. In the short term, it may be followed by a small consolidation before price may continue lower.
For the very short term, if price breaks above the steeply sloping rose trend line, then look out for a deeper correction. Expect price to fall to next support at 2.55 while price remains below that line.
This trend is not yet extreme and there is no divergence yet between price and RSI to indicate weakness.
ELLIOTT WAVE ANALYSIS
MAIN WAVE COUNT – WEEKLY CHART
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This wave count expects Natural Gas is in a new bear market to last one to several years.
MAIN WAVE COUNT – DAILY CHART
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If a deeper correction does develop here after the selling climax, then it may be a primary degree fourth wave that may last a Fibonacci 13 or 21 days. First, the rose trend line on the TA chart above must be breached to indicate primary 3 is over. So far it is less than 1.618 the length of primary wave 1, so it is likely to continue further.
ALTERNATE WAVE COUNT – WEEKLY CHART
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Downwards movement from the last high may be primary wave B coming to an end as a very common expanded flat correction.
ALTERNATE WAVE COUNT – DAILY CHART
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Minor wave 3 has only just broken below the lower edge of the base channel. This is how a third wave should behave. The selling climax of the 21st of February may be followed by a brief shallow correction before price continues lower to complete minor wave 3. Minor wave 4 may not move into minor wave 1 price territory.
Both Elliott wave counts expect Natural Gas to continue lower from here at least to make a new low below 2.549. That has not happened yet.
USDJPY
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
I have published this pair often in Trading Room. That is because I consider it to be a good opportunity at this time. The idea of Trading Room is to look for markets that are trending and find entry points to join the trend in order to have a wider range of opportunities to profit from.
This is my favourite trade set up: a breach of a trend line followed by a back test of support or resistance. USDJPY has done this with the blue trend line.
The risk with this set up is that the trend line is too steep and not often tested, so price may break back below it. The risk does not at this stage look to be high, but it must be acknowledged.
Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
This market is behaving as expected so far.
EURUSD
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
Last analysis of this pair expected a bounce to unfold after the candlestick of the 15th of February showed a bullish long lower wick. This was followed by a strong upwards day, and now a strong downwards day.
This is not correctly a bearish reversal pattern; the red candlestick for the 17th of February does not engulf the green candlestick for the 16th of February. However, it is still a strong downwards day and is bearish. Price may now be finding some resistance at the Fibonacci 13 day moving average and the mid line of Bollinger Bands.
ELLIOTT WAVE ANALYSIS
Click chart to enlarge.
On Balance Volume remains bearish. A purple resistance line is added. The last test is another small bearish signal.
EURGBP
TECHNICAL ANALYSIS
Click chart to enlarge. Chart courtesy of StockCharts.com.
This pair is presented in response to a member’s request. While the Elliott wave count is bearish, this classic analysis is not so much.
The last two upwards trends reached extreme. Since the high on the 16th of January downwards movement has brought ADX down from extreme. There is again room for a trend to develop.
This market currently looks range bound. Resistance is about 0.8650 and support is about 0.8450. The bottom line is a breakout would be required before any confidence may be had that this market is trending.
ELLIOTT WAVE ANALYSIS
MONTHLY CHART
Click chart to enlarge.
The large downwards wave labelled Super Cycle wave (II) will not fit as a five wave structure. It will only fit as a three. This may be the end of the bear market.
The upwards wave labelled cycle wave I looks like a very good five wave impulse. It should be expected to reasonably be followed by a three wave down movement for a second wave correction, which is most likely to end close to the 0.618 Fibonacci ratio.
DAILY CHART
Click chart to enlarge.
C has not yet moved beyond the end of A to avoid a truncation. The target has a good probability.
While classic analysis is not very bearish, this Elliott wave count is.
Use the lilac line for resistance.
Volume analysis:
The strong volume for the last session of the 21st of February supports this wave count. The fall in price is supported by volume here as a third wave should be.
On Balance Volume is giving no signal, either bullish or bearish.
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 @ 12:10 a.m. EST on 22nd February, 2017.
The Trading Room – 21st February, 2017 – Video
Natural Gas Elliott Wave Technical Analysis – Video – 16th Jan, 2017
Natural Gas Elliott Wave Technical Analysis – 16th January, 2017
Summary: Natural Gas is in an upwards trend. The last correction ended at support on the 9th of January. The target for upwards movement to end is about 4.304.
MAIN ELLIOTT WAVE COUNT
WEEKLY CHART
Click chart to enlarge.
This weekly wave count for Natural Gas begins at February 2014 candlestick. Data from BarChart does not go back in history far enough to begin the count earlier.
From February 2014 candlestick, a large downwards wave is complete to the low on February 2016. This subdivides neatly as a five wave impulse. If this piece of the analysis is correct, then it should be followed by a three up that may not make a new high above 6.489.
This main wave count sees the three up as incomplete. It should be expected that this main wave count is more likely while price remains within the Elliott channel. Assume the trend remains the same until proven otherwise.
DAILY CHART
Click chart to enlarge.
Cycle wave b is seen as an incomplete zigzag. So far, within the zigzag, primary waves A and B are complete. Primary wave C is incomplete and continuing upwards.
So far only intermediate waves (1) and (2) are complete within primary wave C. Intermediate wave (2) is a common expanded flat correction. This wave count now expects to see an increase in upwards momentum as a third wave for intermediate wave (3) unfolds.
A target for intermediate wave (3) is not calculated because it does not fit with the higher target of primary wave C.
Within intermediate wave (3), no second wave correction may move beyond the start of its first wave below 3.099. If this main wave count is invalidated, then the alternate below would be used.
ALTERNATE ELLIOTT WAVE COUNT
WEEKLY CHART
Click chart to enlarge.
This wave count is identical to the main wave count up to the end of primary wave B within cycle wave b.
It is possible that primary wave C is a complete five wave impulse, which means it is possible that cycle wave b is over.
DAILY CHART
Click chart to enlarge.
Primary wave C must be seen as a complete five wave impulse. To do that it does not have as good a look as the main wave count for this piece of movement.
A new high above 3.903 would invalidate this alternate wave count and that would add confidence to the main wave count.
TECHNICAL ANALYSIS
DAILY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
Natural Gas is in an upwards trend. The short term average is above the mid term, which is above the long term. At this stage, all three averages are pointing upwards.
ADX disagrees though. It is declining, indicating the market is consolidating and not trending. Price has been constrained within a large range from about 3.105 to 3.705, areas of prior strong resistance and support.
The upwards trend reached an extreme level at the high on the 9th of December with ADX above 35 and above both the directional lines. Thereafter, price has moved sideways in a large range. This has dropped ADX down to the low 20s, giving room again for a trend to continue.
While ADX remains pointing downwards, one approach to this market would be to use support and resistance lines on price in conjunction with Stochastics to indicate when each swing ends and the next begins. At this time, price has turned up from support and Stochastics has turned up from oversold. It is reasonable to expect price to continue overall upwards from here to reach resistance. If Stochastics reaches overbought at that time, then the upwards swing may end.
Two of the three last upwards days show some increase in volume. This supports the idea that price may continue higher at least to resistance here.
Price has turned up after reaching the extreme lower edge of Bollinger Bands. With price now at the mid line of BBs, watch it carefully here. This may offer resistance.
Finally, the strongest piece of technical analysis here is On Balance Volume. The break above the purple resistance line should be taken seriously. This is a bullish signal. OBV often leads price when using trend lines.
This analysis is published @ 12:55 a.m. EST on 17th January, 2017.