Thursday, 27 August 2015
My prediction of yesterday was incorrect. NASDAQ (and DOW) rose to break through the blue Downtrend Resistance Line. The new Channel that emerges faces upwards.
Early morning sees European markets opening higher, but Bull-Bear tug-of-war very active. Who dominates will be a clue as to whether NASDAQ is at a peak. I would not bet on it rising higher, but expect a downswing.
Tuesday, 25 August 2015
Line A is the long-term Support Line that has held since 2013.
Line B indicates an emerging down-trend (in anticipation of coming interest-rate hikes, I suppose).
The bounce-back from the Chinese Fall has crashed through this emerging Resistance Line, but I expect the down-trend to re-assert itself, with probability that this Resistance Line will be re-instated.
After its bounce back from the Chinese Fall, the Dow continues its downtrend and tries to define a Channel in which to move.
Monday, 24 August 2015
Every currency wants to devalue, so the ECB's long lead in the devalue stakes has come to a halt. When the Euro1.78% comes down from its current peak, it will rise to its next peak somewhere around the same. The trend continues upwards
Friday, 21 August 2015
Support Line A was breached on 25 May, indicating the beginning of a downtrend. Support Line B of the downtrend is now severely breached. Unless we are to see a market crash (for which there is really no reason), today's plunge should be compensated by a upwards surge. That is in the nature of spikes.
Thursday, 20 August 2015
The present pattern suggests an upswing from here possibly as far as 173.50 (DIA price), followed by a downswing to c. 171, as the DOW continues is downtrend fuelled by prospect of Interest rise in the New Year. Final tentative target of the Downtrend is represented by the Green Line, in Jan or Feb 2016, at around 155.
If the DOW is in a downtrend, why not the NASDAQ? I see the NASDAQ 100 swinging up for a bit (possibly to 4500), before continuing its nascent downtrend. Not as definite a downtrend as the DOW, but are not all the American markets to react the same to the prospect of interest rates rising?
Wednesday, 19 August 2015
Today, Wed 19 Aug, the US Central Bank will give a hint as to whether interest rates will rise in Sep. Most likely they will not - saving the markets from a severe plunge. Postponing the rise in interest rates will give the markets a breather. The curves on the chart show scope for the downtrend to slow down for a while.
Monday, 17 August 2015
The long term chart shows the EUR/USD at the bottom of its natural zone, and rising from this bottom.
Downward pressures are the prospect of a rise in American interest rates and commencement of Quantitative Tightening in the US, as against continuing ZIRP and QE in Europe.
A week ago it seemed that these pressures had stopped the resurgence, but China stepped in to force the Euro to rise against the Yuan, which necessarily means rising against the Dollar. The balance has, perhaps, shifted back in favour of a rising EUR/USD.
Wednesday, 12 August 2015
Whatever the immediate stimulus (Chinese exchange rate cut?), the DOW downtrend has strengthened. We are now in for a deep correction. My chart shows DIA (DOW INDUSTRIALS ETF) continuing to fall from its present $172 to c. $145.
Tuesday, 11 August 2015
Saturday, 8 August 2015
Monetary outflows from Europe continue according to Deutsche Bank.
US interest rates are to rise later this year.
QE, if the funds are not re-invested, will convert into Quantitative Tightening.
The US Dollar will strengthen again against all comers except, perhaps, GBP and NZD.
While the trend of the Euro against the Dollar has been slowly upwards since early Mar, this rally has proven rather weak-hearted and is running out of whatever steam it had. The year-long downtrend that began in May 2014 appears to be re-asserting itself. This week EUR/USD must break through either the Year-long Resistance Line, or the 3-month old Support Line. I guess that it is the Support Line that will not hold.