LONG TERM CHARTS

With all the "China Trade War tweeting" being done by TRUMP (makes you wonder if he is gaining financially from this ;) ?)

There will never be a deal that satisfies both sides.

However, with the markets dominated by Autobot trading - it has made for difficult trading conditions especially if you look at longer-term trends.

So LOOKING at very long term charts can help with the BIGGER picture

DAX  weekly
A bit speculative but price action so far is playing along.

Even LONGER term below

Next posts DOW, NDX and FTSE

Dax weekly and daily

This was the weekly chart posted previously

here is the weekly to date

Sows the break of the uptrend since December 2018
Found support at the 200-week moving average

rally to test the trend line - a break above and the bull move higher probability
a failed rally to the trend line - a test of the lows  and possible bear move
a failure short of the trend line, the higher probability that the bear move is stronger

DAILY

arrows show various scenarios

keep an eye on levels 

DAX - long term view

So the markets have had some wild gyrations in recent weeks - seems to be a TWEET based market

so sometimes it is beneficial to take a step back to a LONGER time frame - in this case, the weekly DAX chart, shown below

 Can't See the Forest for the Trees!

This is  a LONG term chart

Head and shoulders formations don't always complete

However, today's move looks like the start of the right shoulder shaded blue area

MACD crossover imminent 

The target, if it breaks the neckline,  COINCIDES with te LONG term uptrend

Remember markets have been pumped by easy money, investors looking for return when rates are at all-time lows in most developed economies.  Central bankers and governments trying to keep the illusion of growth going.  The emperor's new clothes  - 21st Century style!

LONG TERM CHARTS 2 -

DAX - monthly

Again, as with the Nasdaq 100 the Dax long term chart is also showing NEGATIVE DIVERGENCE - as it's a LONG TERM chart - it's a warning signal not a call to action - but worth bearing in mind.

Where are we?  over 10 years of a bull market  -

short term - battle grounds galore

2 hour charts for DAX, FTSE and NDX 100

Battle in all markets between sellers and buyers
(S&P 2830, 2785 - key levels)

waiting for breaks of up or down for next direction
Or trade the range - but getting smaller so should resolve soon

Calm before the storm? Or blue skies ahead?

After a strong rally from December lows markets are in a "wait and see mode " - STILL !
Waiting for : trade deal with China (probably priced in - bar the pop on the new)
Waiting for Trump to reach deal with Dems on Border Security (i.e. THE WALL)

Quick look at DAX :

Daily chart from the 7th
Looks like a breakdown from a bear flag
Relative weakness vs other major markets
Look left  - 11550 level if breached might signal change in short term trend - until then medium term downtrend still in force.

DAX 2 hour from today

This shows the break of the recent uptrend
And a rally from oversold levels
could be a test of the broken trend line and then resumption of downtrend  OR
that fall was a fake out and now rallying to test 11550 level

Finally look at weekly DAX
testing the 200 week MA
rally has relieved oversold

Still waiting for resolution

Bulls are cheering and the talking heads have declared the bear market has ended.  read Jim Cramer article here.

Has it?

Well admittedly the rally has lasted about 12 days...

does that mean a BULL market has started?

look at some charts

DOW daily

So far down trend is still intact
clear classic rising wedge  (usually bearish) shows - more often than not there is a throw over (a rally above the upper boundary) which is quickly retraced

Nasdaq daily

bearish wedge
short term trend is up
but down trend still intact
could target 6750-6800

would need a break above 6880-6900 and follow through to start trend change

DAX and FTSE similar

DAX key upside level 11520
FTSE 7131  - Brexit vote  may have an effect

Finally - a rally - but is it a trend change?

Finally Friday's action looks like seller stepped back and markets had a decent rally.  Is this a change of trend?  Or just a correction?

Last post looked at the monthly charts, now zooming in to look at the weekly charts.

First the headline index  Dow Jones Industrial
Remember the downtrend on the monthly shows it in perspective - the odds favour a deeper correction.

1.  Bear market rallies are usually very strong rallies
2. The chart shows the down trend within a channel - prices reached the lower boundary - so the market was ripe for a reversal
3.  The action (so far) is still contained within that channel
5. There is still room to the upside to reach the top of the channel.
6 if this is just a short term bear market rally then I would expect prices to turn down again NEAR the top channel
7 A significant break above that channel and we may visit 24236 (see previous post)

May have been premature in discarding the 24236 target
Stopped out of all short positions on Friday - for profits
flat and watching 
expect rally to continue to at least top of channel and possible larger correction in which case 24236 on the cards

What about the other markets? 
DAX weekly

Similar channel
DAX has been showing relative strength vs US markets - has come close to the 10220 target (10275 low)
shaded areas show potential Fibonacci targets for a correction of down trend
Elliott wave - could be starting a wave 4 (up/sideways )  4's can be very difficult to trade - lots of whipsaw

FTSE weekly

Also in a channel
last post highlighted that it was reaching obvious trend line support

Nasdaq 100 weekly

Also in a down trend - but nearer to breaking out
if it does targets next trend line 6750 ish
a turn back down here likely sees new lows

CONCLUSIONS

Markets still in down trends but all rallied near bottom of the channels
May be a sign of short term trend change  to up (6-7 days)
Anything larger may mean bigger upward move
Be nimble and don't get married to short side
Volatility will still be present

2019 !

So a new year begins

looking at 2 long term charts - the DOW (headline index ) and the DAX (Germany - Europe's largest economy)

DOW JONES INDUSTRIAL monthly

!. This shows the decline at the end of 2018 and puts it into perspective related to the 2 rallies; from 2016 (Trump rally) and the 2008 rally.
2.  The rally on 2/1/19 failed to reach the 24200 target
3.  at the moment it looks like it can test the long term up trend (blue line) and there is horizontal support (look left)

will look at shorter time frames over the next dew days
Market view can change - but it seems that unless we get a trade deal out of Trump and China (and this may end up being a few days of euphoria before reality sets in ) then likelihood is DOW can head to 20k and possibly 18500




DAX monthly

Break of the up trend since 2011
Up trend from 2009  - trend line support 9100 and rising
LONG term trend line support 5900 and rising
horizontal support 10050 and 8066
Head and shoulders target minimum 10220

So 2 major markets seem to be in sync
 A trade deal with Trump (USA) and China would more than likely have a sharp rally so be wary - if short -
HOWEVER - in TA NEWS doesn't matter and if the primary trend is now down - this will re-assert itself

Does the 1000 point rally mean the bottom is in?

So a huge points rally on the first day of trading after Christmas day - is it significant?

1000 points IS a big move - BUT when looked at in PERCENTAGE terms - yesterday's move did NOT even make it in to the top 20 moves since 1900 !

For source click here : Percentage moves of Dow Jones Industrial

Now look at the daily chart:
1. after  a down trend of 16 days it is normal to have a reaction rally
2.  can be 4-7 days long
3. some upside targets 23231, 24284 ( Fibonacci levels)
4. Longer term down trend still intact until 26100 breached

So this kind of move will generate a lot of short covering - so volatility will still be a major feature of the markets.

Pick your moments to go long or re-short

What about other markets?
FTSE daily

No break of down trend

DAX daily
Again no break of down trend

Strategy:
Probably range bound until New Year -
Correction which will alleviate oversold conditions
Once this is done - one more move down the real panic wash out

DAX 10220
FTSE 6300 (BUT may be affected by currency moves)
DOW new target 20k

CAVEAT: Watch the down trend and especially the much higher levels for a change in trend

That was fun! Dow closing in on 22300 target (Dax 10200)

There are benefits of not having huge positions on a day like today;

less stress
more choice
small positions means more flexibility for volatility

Dow looks to be closing in on 22300 target
see what happens tomorrow

DAX  10200?  Head and shoulders target
still stepping down to that target

Saturday is a full moon - from experience could be a wild day and a possible low point for the market - especially with a short trading week next.
Moon cycles and Stocks - a lot of research out there
or here
Having studied Zoology (and in particular ethology) I am amazed that people doubt the influence of the moon (and sun) on behaviour - after all many animals have behaviours dictated by moon cycles and they are the obvious observable behaviours (mating etc) - but possibly many more as well.  Humans are ANIMALS!

Markets take a turn for worse (if you're long)

So the "XiTrump" rally lasted all of one day.  See previous post here

What is the roadmap now?

What is the psychology of the market(s) ?

In words:
The Fed rally was explosive - however this was probably short covering and machine driven trading - this means NOT much SUPPORT for the market. 
The "XiTrump" rally was also a NEWS  driven rally - again these rallies don't give a lot of support to the market as they are too quick/

Explosive rallies like these tend to be characteristic of BEAR moves  so for the moment the DOWN trend since October remains in force.

So where to?  Short term I expect markets ti accelerate the move to the downside (today US markets closed) so maybe Thursday.  Reason being that they have spent a couple of weeks consolidating - corrective - so next leg down soon.

Targets remain the same from previous posts DOW 23200 DAX 10200 FTSE 6400 (? complicated with BREXIT )

If markets don't reach these then likelihood is selling is abating.

If markets reach these targets then what happens next will give clues to the next move.. RALLY or further DOWNSIDE.

Charts below of the DJI

Charts of DAX showing head and shoulders targets (notice coincides with long term up trend)

Looking forward to THURSDAY!

Post mid-terms

Wow - so the result was more or less what was predicted in the polls, and the markets had a HUGE rally.

Since the low of 2 weeks ago the DJI is up 2000 points.

Are we on our way to new highs?

Looking at the charts.

DJI - Daily chart with possible Elliott Wave count (BULLISH MEDIUM TERM)

Notes : Elliott Waves (click here for more information https://bullwaves.org/elliott-wave-course-define-dominant-trend-using-elliott-wave)
Elliott noticed that markets move in impulses (5 waves) followed by corrective waves (3 waves)

There can always be different wave counts (alternatives) - but it CAN give a clue as to market direction

so if we are in a final V wave up for this bull market to NEW all time highs, and we have had wave i and ii, then we are in wave iii.  The recent 2000 point rally COULD be the start of wave i of iii of 5, may not be finished

when it does finish then we should get a wave ii down before the wave iii of V.

Wave 2's can be deep which may suck in bears thinking that this is the next leg down.
(THAT COULD BE AN ALTERNATE COUNT)

Looking at the DAX in Germany (and FTSE similar);  despite the HUGE rally in the US the market remains subdued.  This could change with a break above 11800 which would invalidate the Head and Shoulders formation (previous post)

This may tie in with a fall in US markets- whatever there is a disconnect at the moment..but a fall in US could continue the correction ...
Alt: US continues to rally and DAX breaks upwards

A look at the DAX

So yesterday was a strong rally day - have markets turned the corner.

All the talking heads were very bullish and still talking about bottoms (market ones!)

- that to me is a warning that it ain't over yet.

After 11 or 12 days down - it is NORMAL to get a counter trend  - 2-3 days or sometimes an extended correction 7 days..

Bear market rallies are VICIOUS - as real buyers step in and short sellers also cover positions

Remember VOLATILITY will continue, there will be wild moves, you have to be NIMBLE.  

Most traders lose money in bear markets - due to the volatility

DAX rising wedge - tends to be a bearish formation

at the moment midday London time, it looks like a failed break out or throw-over..but that could change during the next 3-4 hours.  

Key level - if break to downside 11400 , probability of down trend continuing increases.

Conversely follow through above 11575  favours 11700-11780 (test of neckline of heand and shoulders**)

**  Remember if patterns fail the move can be dramatic in the opposite direction, i.e. if a head and shoulders top fails a sizeable rally would probably occur

Probably/probability/  looking at charts is not predicting moves but working out probabilities of certain events happening - sometimes more than 2 options may be seen

NO breaks yet DOW - but close

Looking at the DOW;

2 hour chart

DOW 2 hours

1.  Still contained within falling wedge.  Low boundary 24k  Top boundary around 25k, then 25400 (key)
2.  watch for false breaks either way
3 as the wedge progresses trade will be more volatile - battle between sellers and buyers intensifies

Other markets are similar
DAX daily

1. Daily chart show large head and shoulders  (click link to read about this pattern)(bearish) pattern neckline around 11720, target 10200

2 The neckline was broken, and now it looks like a break above 10370 will be a rally to test that level 11721

3. A break of a head and shoulders neck line is usually retested

DAX 2 hours

1.  Looks like 10370 being tested ..next key level 10430

Markets can see a decent  rally and still not break the longer term bear trend..

warning signs that down trend has, breaking key levels on the upside  finished 

DAX correction imminent?

Daily chart may be turning..if so what does WEEKLY look like...................

When turn comes can correct quite a bit and not even dent weekly up trend..

No change in UPTREND ..YET.but some warning signs?

DAX

#New all time high !
BUT ..

FTSE seems to be lagging or is it LEADING??  could be froming a bull falg..but surprising with DAX at ATH it hasn't accelerated UP..as yet...

INSIDER selling seems to be picking up over last few weeks..sells about 2 to 3 times more than buys
Data from here  http://j3sg.com/

Gap up open today..maybe  some PANIC buying finally coming in ? Sign of retail feeling left out?

Charts

DAX

FTSE

Bull flag or topping? Weekly chart may give some clues?

FTSE WEEKLY

Not much clue here still looks like 2 possibles bull flag or double top.. a decisive break above would mor elikely mean NEW ATH as well..

How about monthly?

 FTSE MONTHLY

Monthly LOOKS like a top and possibly important one forming, HOWEVER a MONTHLY chart is LONG term.. best to keep it in back of mind...
RSI starting to show some neg divergence..
Previous tops took over 8 months to form..whipsaw and false breaks up and down.

DAX MONTHLY

Thrown in for good measure..
Broken out..
accelerating up..
Only caution is RSI starting to enter overbought, but would suggest at moment no change in trend.

Update DAX, FTSE

Still twitchy markets, hanging on political situation in USA

DAX daily

Despite all the political turmoil in the USA, the DAX has been very resilient and the down move least pronounced of the European markets.

It seems to suggest that actually the recent down trend is just a correction, and once the political scene in the USA is resolved (which it more likely will be), markets will attempt new highs.  QE likely to continue.

FTSE daily

The FTSE has corrected more sharply than the DAX and has nit made all time highs yet, possibly due to strength of the pound in recent weeks, plus a hit on retail sector, and mining.  QExpecting that more liquidity around the world will eventually raise inflation expectations and tangible assets will rally.

DAX month of gaps and range

Since Sept the DAX has basically traded in a narrow range, with the big moves coming on overnight GAPs to the upside, coming at all time highs.

After the last gap to all time highs (high 8771) the market has traded back to gap support around 8600 and for 4 days traded in a very narrow range 8700 to 8600.  What next?

Waiting for a break of 8600 for a bigger move down

or a break above 8700 to see if the bull move is renewed and new ATH on the horizon.

proceed with caution if a BULL tighten stops

if a BEAR beware breaking to new highs, may go further and faster than one may think

Daily chart

DAX weekly

DAX bull move intact

DAX 

The BULL move since Sept 2011 is STILL intact and EVEN a fall to 7950 wouldn't change this much.
If it finds support at or above this level, a good chance of new ATH or at least a retest of the highs.

ALTernative : The market is in the process of correcting the advance from JUNE 2011 a 62% retrace would be around 7050

OR the market is correcting the advance from SEPTEMBER 2011 , a 62 % retrace would be 6400

Obviously the latter scenarios (IE bigger corrections) will not be straight line affairs, but would change market from BULL to med term bearish (or short term bearish to med term bearish)