Nice channels

Weekend update

Nasdaq Composite presents itself with clear support and resistance lines. The green resistance hit at the top was a very accurate turning point. The recent bottom coincided with the orange and blue support lines that makes it a strong medium term bottom. The next hit on the blue support will be the 4th and that's the one to be cautious about for a break down. In addition, the recent top's RSI indicates that a new top may have strong negative divergence on the weekly and the daily charts similar to the 2010 top which would be a great shorting opportunity. Until then, I consider this as the last wave up with the target of 3537 and the rising support currently is at 3332.

Gold bounced right at the bottom of the green and orange channels. The ellipses locate the pillars of these two strong channels and until they broke up we cannot expect the widely anticipated bull market to continue. The red and blue support lines are shown in my previous gold posts so I will not show them again.

Aussie dollar's red declining channel is still in charge. There is positive divergence on the RSI and it just hit the blue support line which makes it also a candidate for a triple bottom. There is very strong positive divergence on daily charts as well. 

The weekly Aussie chart indicates a possible reversal here with the red hypothetical rising channel support. In addition, last time RSI was this oversold was at the long term bottom in 2008 shown in blue. Furthermore, the shorts had reached a new record before last week. That record was probably broken again in this last leg down. Concluding, the reversal may be very near.

Last but not least is the British pound getting prepared for a bounce towards 1.58 but it has to break up the exhausted green declining channel first.

Nasdaq composite flying above and beyond

The last push on Nasdaq Composite has gone above and beyond my expectations so far. What surprises me is the weekly chart below. The red support was broken in October 2012 and tested 4 times during this push since November. I thought it is time to say goodbye to that resistance, turn down and never hit it again. But no, it kept its pace and now broken that resistance up.

The only chance for the bears here is the green resistance to hold which is around 3467 today, of course rising every day until it is hit. Above that, is unchartered territory and I can't see any clear resistances. Hope it helps.

Triggers ready ?

More channels more fun

Just when I thought my EURUSD declining channel broke upwards, Cyprus massacre changed everything. There is now a much stronger blue channel. It is severely oversold and there is a massive gap which occurred during the "weekend" trades. It will definitely be filled but when will it occur is anybody's guess. If they stop the wealth confiscation on the island before the banks open on Thursday, Euro may jump and fill the gap. Otherwise, the bottom of the channel is real deep.

GBP is doing well in the correction. We will see if the blue channel will confirm which will accelerate GBP annihilation. If not, we should hit the upper wall of the green channel soon.

Natgas smashed through the blue support and now is following the well established red channel towards 4.8-5$ area.

What surprised me is how much selling power was left in the coffee trade. It bounced off the declining support and made a lower low which doesn't look good for the coffee bulls at the moment. It is right at the brink of breaking the support coming from 2003 which I showed earlier here. It may be in the  making of a descending triangle which is an trend ending pattern. It is oversold but I don't think it would be wise to buy this before it breaks the downward channel.

Last but not least is the Nasdaq composite. I think the chart talks for itself. It looks very squeezed and stressed. It tried to break up the red resistance countless times after breaking it down in November 2012. There is a blue resistance which it has already hit and bounced down and then there is the green support which it will hit for the fourth time soon. We will see when it gives in and corrects a while.