Bo Yoder´s S&P update

The S&P 500 (ETF Proxy – AMEX:SPY) has bounced away from its lows and is in the process of forming a lower high. Our forecast is that price will wriggle a bit but move higher up into the reversal zone drawn on the chart.  A retest of the lows is highly likely, so my posture is one of stalking a short in the reversal zone.

My watch-list this week is full of possible inverse head and shoulder patterns that are currently at the “head” stage.  These setups are likely to mature right as the market begins to challenge resistance.  This will allow us to measure power levels and get a better odds picture about the likely success or failure of these patterns.

SPY 8-31-15

Intel Corp (NASDAQ:INTC) hit stop loss orders as price fell below the lows of the red zone. Time to move on and wait for the next opportunity.

intc 8-31-15

 

Denbury Resources (NYSE:DNR) continues to act with relative strength, as price challenges the highs of the recent range.  Our forecast is for price to continue to push higher, as a new uptrend is created.

Bo Yoder

RBJ Financial

 

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Wait for the Green

When I wrote last week that I felt there was more downside I was unprepared for the scale of the fall on Monday afternoon, UK time. The US market as defined by the Dow cash fell in an “air gap” to a 127 extension of the range defined by the October 2014 low to the 2015 high.

That’s where the smartest money had their orders and it’s a harmonic pattern that I have followed for many years in intraday trading of indices and Forex. This level was also a 38% retracement of the range between the low of the Euro Crisis in 2011 and the high of this year. FIB traders look for these important confluences to pinpoint high probability areas of support and resistance.

Also a trend line drawn between the Euro zone 2011 low and the high of this year was around the same level. This trendline suggests that the bull market in the Dow is intact.

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After Mondays move downwards the 30 stock index managed to close above the open and chart a bullish weekly candle pattern named by technical analysts as a “hammer”.

The deliberations at Jackson Hole have come and gone with nothing concrete on whether US rates will increase in September or later in the year. Fischer says they will wait for more data and in the week ahead (31st August to the 4th September) there is lots, with the week ending with the Nonfarm Payrolls on Friday at 830 ET. Financial futures moved their bets to a September hike last week which saw strong advances from the Dollar.

The VectorVest Composite which is a very broad measure of the UK market was stronger than the Dow during the selloff of the last few weeks and bounced from the October lows and also was up on the week. The Composite has also charted a weekly “hammer” formation which is bullish especially as it has occurred at the double bottom.

As I wrote last week the VectorVest program gave lots of warning with a very bearish Red Light sell occurring on August 18th that was confirmed by the RT Kicker timing system. I have defined the signal in last week’s entry of this blog.

As I write after the close on Friday 28th of August the short term trend on VectorVest has turned up while the underlying trend is firmly down. An Up/Down situation. On the Color guard there is no sign of a Green Light and for me that means it is much too early to buy any stocks. The turn is fascinating and it normally occurs with the same sequence each and every time. If you are new to VectorVest please invest the time to study this potential reversal. The order is as follows.

  1. The Primary Wave turns up. That’s has already taken place on Friday. It’s a very aggressive signal and only for the bravest of traders.
  2. The Green Light Buy. This is simply a Green Light in the price column of the Color Guard on VectorVest. It shows visually that the price of the Composite had advanced both day over day and week over week. It’s still an aggressive signal but an excellent signal for leveraged and CFD traders to get onboard.
  3. The Green Light Buy is confirmed by the RT Kicker Timing system. I defined this awesome signal last week but in essence it’s a signal from price that occurs when momentum is rising. This is a very strong Buying signal and prudent traders should be getting their feet wet when it is observed on the Color Guard. It’s shown by a black asterisk within the Green Light on the Color Guard. We all felt the mirror image of this signal playing out last Monday.
  4. The underlying trend turns to UP as the Market Timing Indicator (MTI) on VectorVest moves above 1. This proprietary indicator combines a rate of change of both the price of the Composite and the breadth of the Composite in a unique way to define the longer term trend of the London Market. The breadth of the market is defined by the VectorVest BUY/SELL ratio. Prudent traders and investors should be involved after observing this signal.
  5. The underlying trend is confirmed by the Composite moving higher for two weeks. This signal is known as a Confirmed Call and makes an excellent entry for Conservative investors.

Please note that on many occasions the signals occur on a single day. For example it’s common for the underlying trend to turn up and be classified as a Confirmed Call on the same day.

The SP500 broke down last week by 11%. Anything can happen in markets but history shows that a V bottom is unlikely as such a strong move down. Although the “hammer” weekly candle is promising please don’t be too surprised to see the stock markets of the world pull back and even under the most positive chart a rising or even double bottom with last week’s low.

Try not to watch too much TV and the opinions of seemingly knowledgeable fellows. They are guessing. Just observe the comments and signals on VectorVest and take the signal above that suit your stomach for risk. For Example Susan Thornborough who runs the London User Group has decided to always wait for the Green Light Buy confirmed by the RT Kicker before getting involved. This gets her onboard with a high probability signal well ahead of the Confirmed Call.

I am still holding my positions and all are well above the Stop Loss although it was touch and go last Monday afternoon. I will consider adding to these when I see some Green. As I have started with “Wait for the Green”

Try VectorVest for yourself for 5 weeks for only 5.95 GBP ($9.95) – click here

David Paul

August 29th 2015

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Bo Yoder S&P Update

Last week I wrote about the S&P 500 (ETF Proxy – AMEX:SPY)…”power readings will likely lead to a push back up to range highs …however, our proprietary 3D Apex Predictive Failure Technology™ indicates that any bullish price wave is destined to fail, so be forewarned not to get suckered into any signals.” Finally, after months of waiting, the deep time frame bearish pressure that I have been watching has taken control of the markets.  We are set up for a “Black Monday” say many in the financial press.  Monday to me will be a final test of the politicians will to prop up the markets.  I would expect to see weakness early on, then a snapback attempt will be made, and the amount of power and energy that shows there will determine my strategy for the market moving forward.  If an intra day trader, I would be watching intently for the market to bottom on Monday as the intraday trends off any significant low should offer great follow through.   spy 8-23-15 Intel Corp (NASDAQ:INTC) rotated back down into the red zone for a re-test as forecast.  Price got caught up in the massive selling wave that shook the markets on Friday, and the stop loss looks like it may be hit as price breaks below the red zone.  If a powerful reversal forms in the markets on Monday as the odds suggest, INTC will likely bounce and offer a chance to exit for a smaller loss into strength. intc 8-23-15 JP Morgan Chase (NYSE:JPM) completed our forecasted head and shoulders pattern, and this acted as the catalyst needed to push price deep into the blue zone. With this forecasted move now complete, profits can be taken in full as our focus is shifted to new opportunities. Denbury Resources (NYSE:DNR) acts as a textbook example of the kind of low risk opportunities that are available if you look hard enough. In spite of extraordinary selling in the overall market indexes, this stock exhibited outstanding relative strength, and just touched the red zone to provide an entry opportunity. If the market bounces in the next session of two, I would expect this stock to show strong relative strength as a bullish buying campaign pushes these shares to the upside.   dnr 8-23-15   Bo Yoder RBJ Financial

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Lots of Cockroaches

My old friend and market forecaster Dennis Gartman says that in markets there is never a single cockroach. They always come a dozen at a time if at all. A bit like London taxis. This was the case in the week gone by and I will allow your weekend papers to discuss these insects in detail. China, Greece, US rates and “lead in the sky” on the borders of Korea, all mixed, to produce a scary Friday afternoon. I suspect that the holidays may have added to the chaos with traders squaring off in advance of the long weekends on both sides of the pond.

On a weekly chart the VectorVest Composite has fallen to support as defined by a trendline on the weekly chart starting from a low in May 2012. This is a very important level which is just a tad south of the 62% retracement of the range from the low last October to the high of April this year. The chart is shown below.

david 24th august

VectorVest gave plenty of warning of the move with the most conservative timing system known as a Confirmed Call printing a Down signal at the end of July 2015. This signal (as I say at all the talks) needs to be taken very seriously. The Confirmed Calls can be overlaid on the Market Timing Graph of the Composite and of each and every share on the market by a mouse click. If you don’t know how to do this please call support at 0800 014 8974 in the UK and 0800 981 891 in SA. This is a vital skill. The confirmed UP signals are in the form of a Green arrow and the Down signals a similar red arrow. In essence when the market is giving a Green arrow I want to be in the market and building positions. When Red as now I want to be very careful. At the talks I tell the audience that there are four things to do when you see a Confirmed Down signal.

  1. Don’t buy any more.
  2. Watch the shares you have and monitor the stops carefully.
  3. Weed the garden. Get rid of the weakest or those where the fundamentals have deteriorated since purchase. Raise cash for the next buying signal which will come soon.
  4. Play a little “Bob Marley”. Don’t worry about a thing “Every little thing going to be alright”

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In addition to the Confirmed Down at the end of July the short term trend of Primary Wave gave the last sell signal on August 11th. On this date both the Primary Wave and the underlying trend were down. Two days after this the Color Guard printed a red light in the price column indicating that the Composite was down both day over day and week over week. Also on that date there was an asterisk within the red light. This means that the red light sell signal was confirmed by the RT Kicker timing system. In other words there was a sell signal from price which was confirmed by momentum. In the background VectorVest applies two moving averages to the RT of the Composite. When the short average is below the longer the RT is trending down. When you see the red light and the asterisk together and within a Confirmed Down signal, invariably there is more downside and it makes a great shorting signal.

As you will have seen the Color Guard gave another Red Light sell on August 18th which was confirmed by the RT Kicker and that preceded the strong move down over the last 3 trading days.

Last week I reported that I had bought a 786 retracement of the last range on both the Ft100 and the Dax. Both positions bounced well at these levels and I took a few points on each with half the position. I was stopped at entry on the second half on both positions. The pattern used for the entry was a bullish Gartley and it’s a high probability signal which in this case failed. Once it failed the down move was highly probable. Once the July low was broken, as I have noted here before, the strong move south we witnessed over last sessions was certain. My hope of another wave up was long gone. As I have said often, the Elliott patterns are subjective and ego based, whilst the trends on VectorVest are reality.

I traded the index (Dow cash) twice on Friday using a 5 minute chart and both trades were initiated at FIB levels. In the morning the Dow rose in a perfect rising wedge to a 786 of the last fall and started down again. In the afternoon after the US open the Dow gained in a bearish Gartley pattern to 618 of the last fall and then started down again. I didn’t get all of the moves but happy with my efforts. I use the Color Guard as my filter for intraday trades and NEVER long the market if the Primary Wave is Down. Certainly NEVER long the market intraday if there are RED lights in the Color Guard that are being confirmed by the RT Kicker.

In the stock market I am still holding the shares I spoke of in the last few reports here. They have held up reasonably well and are still well above their VectorVest calculated stops. As you know these were taken from a Confirmed Up signal on the 20th of July which in hindsight was a poor signal.

In the US the VectorVest Composite is approaching a support trendline drawn on the weekly chart from the lows in 2009. The 786 retracement of the last daily range from the low of October last year to the high of April this year is calling the Composite lower on Monday morning. A similar situation is seen on the Dow cash index which closed at 16459 while the 786 level of the range from October last to the highs of 2015 is at 16380. The 786 and the long term trendline on the VVUS Composite are showing a confluence at a single level. The MTI of the US market is at 0.6. The research staff at VectorVest regard this level as an oversold level that invariably precedes a bounce or a change in trend.

It’s not all bad news with the European PMI reporting a sound number and an advance by Germany in particular. The US and the UK are growing and growing enough so as both countries are contemplating an increase in interest rates. I have no doubt that China will respond soon with some form of stimulu

Watch for a shakeout first thing on Monday and then a bounce. I will do nothing until the Color Guard on VectorVest shows me some green.

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David Paul

August 22nd 2015

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The FTSE 100’s outlook is mixed ahead of the inflation report today

alpesh 18th augThis week my note to you comes on a Tuesday as I am writing to you from Greece, even fund managers get to take a few days of holiday! So at the time I am typing these words I can see the FTSE trading very close to its 6,500 points’ lows having spent last week on a downtrend that led the index to this area. What I can’t fail but notice however is the fact that the index looks so oversold at these levels.

One could assume then that my analysis would suggest that a correction to the upside would be the next logical step for the London index and indeed if you look at things from a technical standpoint that would be your conclusion. But this time I am torn and that’s because the fundamentals don’t align with the technical outlook and that mixes up things a bit.

To be more precise, as I mentioned above a correction from this area seems the next natural step as the FTSE has dropped more than 200 points recently and the momentum that drove that decline has diminished. At the same time though today we will have the chance to find out how inflation is fairing in the UK and we know that this report will takes its toll on the FTSE.

Now, analysts expect the core inflation reading to tick higher this month and that would mean that the accelerated rate of prices’ growth should put more pressure on the BoE to think about raising rates early next year. And from my previous notes you should know by now that this is not a welcome development for the FTSE 100 as pricier money supply doesn’t bode well for stock markets.

So now you see why I am torn at this point and why I think FTSE’s outlook is a bit mixed. However we need to be prepared for this development so here are my scenarios: to the upside, I would welcome a break above the 6,600 points’ barrier that would drive the FTSE towards the 6,650 points’ area at least. To the downside a break below the 6,500 points’ support would signal renewed pressures on the index but on that case I would be a bit more reserved than to follow the downtrend. Nevertheless, for the more adventurous trader the technical targets lies around the 6,450 points.

If you want daily analysis and signals on the FTSE 100 then my NewsletterPro – Forex Opportunities™ service might be of interest to you. You can find more information on the NewsletterPro by clicking on this link.

 

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Bo Yoder S&P update

The S&P 500 (ETF Proxy – AMEX:SPY) attempted a bearish breakdown this week and was soundly rejected as bullish power surged.  This reversal of power readings will likely lead to a push back up to range highs, and possibly even a breakout to the upside…

However, our proprietary 3D Apex Predictive Failure Technology™ indicates that any bullish price wave is destined to fail, so be forewarned not to get suckered into any breakout types signals on a daily or weekly level.

spy 8-15-15

Intel Corp (NASDAQ:INTC) broke out to the upside as forecast, but then experienced a power reversal that is likely to take price back down into the red zone for a re-test.

The best case scenario would be for a clean double bottom pattern to form. If a breakdown does occur, we forecast that it will be unsustainable, and will reverse to form the head of what would likely end up as an inverse head and shoulders reversal pattern.

intc 8-15-15

JP Morgan Chase (NYSE:JPM) completed our forecasted move as price reached down to test the blue zone almost to the tick.  Now, we would expect to see prices rally back up to the $60.25 area to form a head and shoulders pattern on the daily chart.  At that point, we will take further measurements and see if a re-entry is in order based on the odds for success at that time.

jpm 8-15-15

Denbury Resources (NYSE:DNR) is an independent oil and gas exploration and production company which has been beat up badly after a sustained downtrend of many months.

Bearish power has been falling off recently, and we forecast that this stock will have one more bearish thrust back down before it is likely to reverse and form a sustainable bottom.

The best case would be for it to reverse near the $3.70 area to form an inverse head and shoulders pattern. It might also test lower and form a double bottom, so be on the lookout for either scenario to occur as price challenges the green zone.

dnr 8-15-15

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Beijing exporting deflation

The main story of the week was the cut by China in the reference rate for its currency. This has taken off 3% of the value of the Yuan against its major trading partners and it occurred a day after Chinese exports fell by 8%. The move took the markets by surprise and although the Chinese central bank said there was “no basis for persistent and substantial devaluation” it has stoked fears of currency wars.

Investors interpreted the move as an attempt to help its exporters. Initially markets and especially emerging markets fell hard but the words of the Chinese central bank seemed to calm the stock markets of the world by the end of the week.

A weaker Yuan will reduce the price of Chinese imports into the US and that could reduce inflation in the world’s largest economy. US inflation is sitting presently at 1.3% with a target of 2. I don’t think a 3% move in the Yuan will have much effect but if the Chinese continue with this program and engineer a larger drop in their currency, then a US rate hike will be certainly postponed.

For years the Chinese policy makers have been the envy of the world. They steered the country to three decades of growth with few blips. The actions of the last few days seem quite agricultural by comparison. Chinas economic growth is stated at 7% but many commentators believe that the real rate is much less and maybe half of the official rate. The possibility of the so called hard landing is very real and a quick look at the Glencore (a mining Ft100 company) supports that view. The rout in commodities looks set to continue.

At a much higher level a very important game is being played between the Chinese and the IMF. This is all about including the Chinese currency in the Special Drawing Rights (SDR). The IMF is due to make a decision of the Chinese currency in the next year but has pointed out that the currency is not liquid and its value not determined by market forces. The devaluation of the Yuan could be seen as an attempt at inclusion in the SDR.

By Friday afternoon the Chinese story was starting to feel like a storm in a China tea pot and the market reacted negatively to US retail sales being much better than expected. This number puts a September hike well in the frame.

The trend situation on the London market as measured by both short and long term trends on the VectorVest Composite are down. The home page on VectorVest says “VectorVest does not advocate buying any stocks at this time”. This is good advice.

My 5 stocks are doing fine and you sleep well at night in stocks that are undervalued and growing earnings aggressively and safely. Even in a choppy market like this. Avon Rubber is a favorite of mine and that share had a really good week and looks set to break new highs soon. I have taken a dividend from Carnival and the share is a tad up from my purchase price. If you look back a few blog issues all my shares are listed and I am 50% invested.

The general market is a worry although the patterns that are setting up remain quite positive to a student of Fibonacci. Some 80 years ago a fellow by the name of Harold McKinley Gartley wrote a book on stock market trading. It’s the only book in my library that I will not lend out. His most famous pattern is the Gartley 222 pattern which comprises of a “thrust” followed by an ABC corrective wave. On both the VectorVest Composite and the DAX cash there is a bullish Gartley in play.

Please pull up a chart of the VectorVest Composite over the last three months. If you cannot find the chart then please call support and they will give you a quick lesson over the phone. The number from the UK is 0800 014 8974 and from SA is 0800 981 891. Locate the recent low on the 7th July and the next high on the 21st July. That’s the thrust. You should then the see the ABC correction from the 21st of July to the 13th of August. The low of the 13th was a 78.6 retracement of the thrust and if you believe in MR Gartleys work that was where you bought. The chart of the VectorVest Composite and the Gartley 222 pattern is shown below.

david 17th aug

A similar pattern is easily seen on the Dax cash and I am long of the Dax on a spread bet from the 78.6 level at 10900. I took some profits already and have the stop to entry. I missed getting stopped on Friday by 10 ticks in the volatility that followed after the good retail sales number and which caused markets to fall.

Once again the FIB and Elliott patterns are subjective and the trends are real. I will wait for confirmation from the home page of VectorVest before adding any more “Big Hitter” winners into my portfolio. However the FIB patterns are still telling me that there is more upside to come in the next few weeks.

I seem to be getting more optimistic as I get older. Please watch stops closely and keep a steady eye on the July 7th low. A break below that level would be very bearish.

On the 24th at 130 PM UK time I will be conducting a webcast on the UK market and the outlook for stock, forex and commodity markets worldwide. All VectorVest members should be sent the link. If you haven’t got a link then please call support.

David Paul

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Bo Yoder S&P update

The S&P 500 (ETF Proxy – AMEX:SPY) cycled back through its range one more time with lower volatility, and an increase in bearish power.

My bias is still strongly bearish, the case continues to be made and reinforced according to our forecasting models…  I’m beginning to suspect that the true bearish meltdown that we are forecasting will begin with a large gap down or some other shock tight event.

spy 8-9-15

Intel Corp (NASDAQ:INTC) has paused here at the resistance offered by the 20sma (blue line) as forecast, and the bullish power has increased.  This should promote the bullish breakout that I forecast last week.

intc 8-9-15

JP Morgan Chase (NYSE:JPM) has followed through perfectly on our forecast. After a drop out of the red zone, the stock has put on a rally back up to complete a head and shoulders pattern near $69 per share.

jpm 8-9-15

I wanted to re-post my forecast for FB as this kind of pattern failure is so common these days.  I am just so passionate to share these “calls” as there is no reason why traders have to get trapped in these scenarios.  All brought to you due to our proprietary market forecasting technology.

Facebook (NASDAQ:FB) has been in rally mode for some time. It has pulled back to form a classic buy signal in the form of a bull flag on its daily chart. But be forewarned, our proprietary 3D Apex Predictive Failure Technology™ has flagged this bullish pattern as extremely likely to set up and FAIL.

If already positioned in this stock, this sets of a great profit taking scenario, as you will have a bullish crowd to distribute shares to as the setup triggers.

fb 8-9-15

 

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The FTSE 100’s outlook hinges on the employment report on Wednesday

So after a quiet and non-volatile few days for the FTSE 100 last week the London index is trading lower today breaking below the 6,700 points’ support that limited any price action during the previous sessions. During the time I am writing these lines to you I can see a correction attempt from the FTSE that is trying to recover and climb back above the 6,700 points’ barrier again.

The question then becomes what’s the outlook for the index for the week ahead and how we should approach the London benchmark. I have been talking about the need for a correction in the FTSE for the past couple of weeks but I am quite surprised to see that investors are putting pressure on the index today after the mixed US jobs report last Friday.

The report was not as bullish as analysts expected and we can see evidence of that in the way the US stocks markets’ futures are trading ahead of the US session, all the indices are pointing higher in order to reflect the less bullish levels of the NFP report. So the FTSE is not in sync with how the rest of the global markets are trading and no one can say that we expect a change of rate policy in the UK any time soon that would explain this divergence.

So my outlook is cautious this morning, from a technical standpoint a correction is justified but the fundamental environment in the UK doesn’t support such a development. I think that technically the rejection of the 6,700 points’ resistance might prove a decisive move for the London index and if that should be the case then I will be looking to short the FTSE towards the 6,650 lows and possibly lower. To the upside I would be a bit more cautious, probably remaining neutral as I am not convinced that the index can climb to new highs.

My focus is on the employment-related reports on Wednesday and I believe that any fresh data could turn the tables on FTSE’s outlook. A host of strong results could put the BoE under pressure to discuss the possibility of an early 2016 rate hike thus sending the London stock market lower and my targets would be as mentioned above. I would like to see how the labor market has performed during the past month before committing into any serious trades this week so I will be on the lookout for any major swings after Wednesday morning.

If you want daily analysis and signals on the FTSE 100 then my NewsletterPro – Forex Opportunities™ service might be of interest to you. You can find more information on the NewsletterPro by clicking on this link.

alpesh 12th aug

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Big Hitters hanging in there

My search the “Big Hitters” is not a standard search on the program but can be easily written in Unisearch. The search is designed to find undervalued shares that are growing their earnings both aggressively and safely. It’s been very good to me in both the UK and SA over my 5 years experience with the program.

The parameters are

  1. RV >=1.4
  2. RS>=1.2
  3. Value/price>=1.05

At present I am sorting these shares by VST (Value, safety and timing).

All 5 shares that I am holding at the moment are Big Hitters shares and I am well pleased with the performance of all 5 in this dull market. Avon in particular has done well with GOG turning upwards during the week. Barratt is trying to break for the fourth time. My mentor MR Gann always believed that the market would break on the 4th attempt. All five I believe will do exceptionally well if the market can break upwards next week.

You may remember that towards the end of June this year I came up with a search to find small cap shares on the LSE and AIM. This was for a talk that I was doing with Zak Mir at Zakstraderscafe. The search named Small Cap Rockets was written to look for shares with a market cap of less than 500 million that had a RV of greater than 1.4 and a CI of greater than 1.4. CI is an unsung here of VectorVest. The Comfort Index, on a scale between 0 and 2, finds shares in the throes of a strong trend with little volatility. A high CI finds shares that have the ability to resist severe and lengthy price declines.

I am happy to report that the four shares I selected in the June 26th blog from that search are doing well. One was Avon rubber which is both a Big Hitters stock and a Small Cap rockets stock. The Character Group is trending well and I note that Capital and Region has just broken above 60p which was a strong resistance level. The latter should do well from here. If you need a search that locates aggressive trades then the Small Cap Rockets may be the one. The charts of Character and Capital and Region are shown below. The green line above the price is the VectorVest valuation. The ascending triangle on Capital and Region looks particularly attractive.

david 12th august david 12th august-2

 

 

As always the general market is 70% of the exercise

During the week past there was several green lights in the price column of the color guard but I decided to get the data out of the way and haven’t bought any more shares. As stated last weekend I am 50% invested.

 

The VectorVest Composite stalled for three days last week as markets waited for data, the so called Super Thursday and the US NFP number. Carney surprised by hinting that rate increases were further off than the market anticipated and the Cable tanked a nanosecond later. That’s the reason I suppose that the UK market strongly outperformed the Dow last week. The US numbers were good and largely as expected. Based on these Yellon should act in September.

 

Both the Ft100 and the VectorVest Composite have stalled at a 78.6% retracement of the last daily range. That’s where the smartest and bravest bears have their sell orders. The highs of the day for the last three trading days have been defined by this level.

 

The Dow fell after the NFP on Friday. The data was good as expected and that means a September hike is likely. The Dow fell to a low that was defined by the down sloping line that technicians will recognize as a falling wedge. This is a bullish pattern with a magnificent risk to reward ratio. In my short term trading I am long of the Dow from the lows of Friday looking for a bounce next week. If I am right there are mega points in the trade and if I am wrong I will lose a few. It will give me lots of opportunity to add to this little position on the way up if the trading Gods smile on my position.

 

I will be happier when the Composite closes above the high of the 20th of July. If that occurs then this wave up that I seem to have been talking about for months is happening at last.

 

I will add some more Big Hitters shares when I see the Color Guard print a green light during the course of the week ahead and will discuss the shares in question during the Q and A session at 130PM on Monday afternoon at 130PM UK time. This will be recorded and support will have a link.

Start your 5 week trial with VectorVest now – click here

 

David Paul

8th August 2015

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