+FASTMKT>>FOCUS, Gold, Stocks and Currencies

Hello All,

We had quite a day on Tuesday.  Gold started out getting smashed, then recovered.  The recovery may have been due in part to the Stock Indices crashing. Even with a $20 recovery from its lows, I expect we’ll see lower prices in the (near) future.  I was surprised to see the Gold recover without taking out the rest of the stops (arrows pointing at the lows of the bars) that hang in a row just below the market, down to about the 1212.1 area.  In the short term, it’s going to take some real strong new (panic) buying to move it up much further than Monday’s highs of 1246.0.  One thing that comes to mind might be some anticipation or result of the Unemployment Report on Friday.  (Gold chart below - click on the chart to ENLARGE)

The S&P took a real dump on Tuesday.  Closing near its lows, I expect one more bump down, to clear out any sell stops below Tuesday, and then a short term recovery back toward its moving averages. The S&P cleared out long term stops below the 1032.25 area and after a move to clear out anything hanging below Tuesday’s lows, I expect the market to turn its attention to knocking out the buy stops from people that have been selling / shorting / chasing the market down. The S&P is far away from its moving averages and I expect it to make a move back toward them.

Below is an example of a market (Cocoa) that got far away from its moving averages and then retreated back. On this particular chart the market got far away on the upside, then went down.

(Remember, there’s no guarantees with any strategy though.)

(Below) I’m looking for the Canadian Dollar to act the same way as the S&P….. Retreat to its moving averages.  If not already long, buy new lows (or perhaps around the 9423 area) for a nice short term spring back up toward the MA’s. Don’t get greedy on the upside, we’re in a downtrend (at least for the short to medium term).

 The word, believable or not as it may sound, was that there were a lot of people short the Euro Currency, hence its long term drop, and when the World Cup started people covered their positions so they could focus on the Soccer tournament.  That was the move we saw when the EC bounced from its lows in the 118.84 area up to around 124.77.  Notice that the move started when the EC was far away from the MA’s.

 The arrows point out a magnificent row of sell stops (beneath the lows of the bars) that can be taken out as the market resumes its downtrend. Perhaps as the teams leave the tournament the stops will get taken out and the market moves lower. (Hey, fundamentals are fundamentals, but “technically” those lows / stops are goners…. in my opinion.)  The anticipation of further crumbling of the Euro zone might have something to do with it too.

Discussion of strategies and analysis is welcome. My door is always open.

Sean E. Blair

 +FASTMKT>> FOCUS
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Who Can Get Hurt the Most?

Who Can Get Hurt the Most?

By Sean E. Blair

Hello All,

GOLD - Below the market there are some lows on the Weekly Bar Chart that are rather close together.  The arrows point to the lows of the bars where the Sell Stops are. Although it is difficult to predict exactly when these lows will be taken out, I would suggest that there is a high probability of it happening… sometime.

(Click on the chart to ENLARGE)

Markets often like to end trends with a blow-off, so a short futures position would be risky right now.  Options are most likely the ticket.  The only problem is that you ALWAYS need to feel you are putting on an option trade at the precisely correct price/level to ensure consistent success with them.  Putting on options “willy-nilly” just because you think a market is going somewhere will cut down on you success rate.

++++>>>

Below is a WEEKLY S&P Chart.  For those of you that like to see a fast moving average cross through a slow moving average to determine future direction….. Looks like the “cross” came through last week, and the confirmation seems to show this week.  To me, this method of entering positions seems to work about 65% of the time.  An example of when it doesn’t work is where the first arrow is pointing.  What you might call, a “fake out.”

The good ol’ Upside Down Bear Arm (bullish) is manifesting itself on the 30 min. bar chart below.

My thoughts are that on an initial break through the 1118.50 area, the SEP S&P will have a (perhaps short term) hard time climbing much higher and correct for an estimated 7 to 10 pts.  Aggressive traders might try to sell very shortly thereafter.  With a move above 1118.50 and a proper RSI reading of between 75 – 80, I think defensive traders can short with confidence looking for a 7 – 10 pt. drop before we’ll see 1142.75.  The greedy soon become the needy, so keep it to a short term trade.  Don’t give back your profits.

If we make it up above 1142.75 in the next 2 days there’s a significant chance of a nice 20+ pt. pullback for those of you that like to sell to people that chase the mkt.

Sean E. Blair
 
+FASTMKT>> FOCUS
Adler 747, Inc.
 
Go Here to Open an Account Online: http://fastmkt.com/
 
2700 W. Pacific Coast Hwy
Newport Beach, CA  92663
Suite 130

 FASTMKT@aol.com
Tel. (888) 919- 0444 >>>> 888 - 9190 - 444
Direct. (949) 892- 6442
Anytime. (949) 939- 9814
Fax. (949) 200- 3119
 
TO ELIMINATE YOUR STRESS AND GET RELIEF NOW, www.ctrlstress.com 

 
***Futures and Options Trading is Risky and Not Suited for Everyone. Trading in Futures and Options should be done with Risk Capital Only, and Should Not Affect Overall Lifestyle should Losses Occur.***

A Gold Trade for This Week

A Gold Trade for This Week

By Sean E. Blair

Hello All,

This stuff is somewhat time sensitive.

The August Gold is leaving little “technical” gaps all over the place. Classical technical analysis suggests that gaps on a chart will be filled. (It doesn’t specify when though.) I will not worry about the gap on the downside being filled and instead, focus on the upside.

Should the Gold attempt another high, I will tentatively focus on the 1267.0 area to initiate a short position with an initial profit objective of perhaps the 1257.3 area. If the Gold moves up rather soon, I could imagine a $20 - $30 fall from its highs, similar to the one from 1254.5 down to 1223.1.

That’s why it’s so hard to buy a dip or stay on a trend- the corrections can be pretty deep.

I prefer to sell to someone who wants to buy at semi-outrageous new highs and ride his ‘slap on the wrist’ down a little ways. I’m more comfortable when I’m on the other side of someone’s trade when I believe they are most likely doing the wrong thing. (In this case, chasing the market).

Long term Trading is a whole ‘nother ball game.

The 60 minute bar chart below is making an ‘upside down’ bear arm formation (thought you’d heard ‘em all, huh?). Translation: The formation is bullish.

Bear Arms can produce big moves from where the shoulder turns. In this case, since it’s an upside down Bear Arm, we could see a move (perhaps rapid) well beyond the recent highs of 1254.5

Call with questions……Silver analysis to follow.

Sean E. Blair

+FASTMKT>> FOCUS
Adler 747, Inc.

Go Here to Open an Account Online: http://fastmkt.blogspot.com/

2700 W. Pacific Coast Hwy
Newport Beach, CA 92663
Suite 130

FASTMKTFOCUS@gmail.com
Tel. (888) 919- 0444 >>>> 888 - 9190 - 444
Direct. (949) 892- 6442
Anytime. (949) 939- 9814
Fax. (949) 200- 3119

TO ELIMINATE YOUR STRESS AND GET RELIEF NOW, www.ctrlstress.com


***Futures and Options Trading is Risky and Not Suited for Everyone. Trading in Futures and Options should be done with Risk Capital Only, and Should Not Affect Overall Lifestyle should Losses Occur.***

Gold Analysis

Gold…. On its way to 1142.9 and likely beyond. An easy target for me to imagine would be above 1148.0. It’s going to take some effort, but there’s a group of stops up in this area that I expect to be taken out. After this, the market will be, “Very overbought.”

My expectation is that after breaking through 1148.0, there will be a decent correction to the downside. I will sell to people that are chasing the market up there, looking to ride my “short” position for possibly $15 bucks.

Whatever you do, don’t buy it up there unless you’re prepared to experience a sizeable drawdown before (possibly) becoming profitable.

Waiting for the Shoe to Drop

Hello All,

This 60 minute bar chart of the April Gold suggests that there’s a decent chance of another fall from current prices in the 1064.0-1067.0 area. I will be waiting for another deep drop and then buy when I hear the bulls screaming their loudest.

The reason for not getting short in this area is that we have forces suggesting the market should go up, and other forces suggesting the market might want to go down.

Look at the Daily bar chart below.

Trading excruciatingly far away from the moving averages on Friday, the Gold had every reason to spring back toward them a bit. The high today of 1074.3 was almost exactly where its weekly pivot was, and came within 10 cents of its former low last week of 1074.4. Former support lows that are broken are supposed to become resistance when re-tested. After the bounce from 1074.3, the Gold generally trailed off (down) suggesting the market is sticking to some technical “rules.”

One technical “rule” is that markets like to go back to their moving averages, which suggests up.

Another technical “demi-rule” is that markets like to seek out stops, and the nice cluster below the market in the 1044.5 - 1029.0 area is just beggin’ for the business….. Which suggests a possible move down.

50-50 is not for me. I will wait for a deep, stop loss hitting run down, and buy for a short term trade from some blatant market chasers in the 1027.6 to 1023.0 area. I expect to see the 1054.4 area or higher, after that. To me, this will occur with an 80% probability (at least in my mind). I prefer the 80%’ers as opposed to 50-50’s when it comes to entering trades.