LSE:TLW Swing Trade

This swing trade was scanned 2 days ago but I wanted to see a 2nd bullish bar to form, to confirm the support.
Friday produced a “Morning Star Reversal” pattern at support (a reliable bullish signal)
– ENTER: Above Friday’s candle
– STOP: beneath 1471 (prior resistance has now been confirmed as support)
– 1st TARGET: Recent swing high and round number of 1600
– 2nd TARGET: The larger pattern appears to be an ascending triangle forming which projects a target around 1720

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LSE:BRBY (Burberry Group Plc)

– Failed to close above the 200sMA
– Formed a Shooting Star reversal candle
– Shooting Star has formed at top of Bollinger Band and near historical resistance on the Price Oscillator – this suggests a return to the 20sMA
– Personal Goods Sector is showing the same reversal pattern
– Current price action looks corrective to the primary trend but this is trading in the direction of the intermediate trend

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TRADE – LSE:KAZ

– Price has managed to stay above the descending trendline and now acting as a support level.
– The higher high now invalids the symmetrical triangle (usually a continuation pattern) and suggests further gains
– The outside day suggests near-term gains
– Ichimoku chart is providing strong bullish signals with potential support around 9.2

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TRADE – LSE:TALV

Here’s a thorough analysis of TALV (Talvivaara Mining Company Ltd) which is a Mining Stock I recently suggested to watch. Overall I think the longer-term bullish confluences look strong and the bearish confluences all point towards a retracement as opposed to continuation of the bearish trend.

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TRADE: LSE:CEY – Centamin Egypt Ltd

– Centamin Egypt Ltd (CEY) is a Gold Mining Company within an established downtrend
– Even though both Gold and CEY are within a downtrend, KEY is the weakest performer as the ratio line between the two is still descending.
– CEY is resting on the historical support/resistance level around 80 – I’ll be shorting on the assumption that if this level breaks it could be quite significant.
– The target becomes a little tricky because not much price action has been seen beneath the 80 level until the 55 mark (which is clearer to see on the volue histogram on the 2nd pic) so initially I’ll target 55 and assess how the trade develops if it ever triggers.
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“Trade what you see, not what you think…”

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FTSE100 – MARKET BREADTH

I had been watching the divergences between the small-cap stocks and FTSE100 for the majority of last year, so when the losses did come it didn’t come as too much of a surprise.
Without trying to sound too bullish too soon into the year, we now see small-cap and large-cap stocks converging again, and with the FTSE closing above the 200-day MA for the first time since August 2011 its certainly not a bad start to the year.
We may we be due a pullback but I’ll be keeping an eye on my bullish stock list for Q1 of 2012 and hope to catch some larger moves.
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“Trade what you see, not what you think…”

Follow @cLeverEdge

LSE:AFR – Breakaway Gap Confirmed

Quite a few bullish candles have formed across the FTSE today on high volume which confirms the Breakaway Gap on Afren.
This leaves 2 options on how to handle this stock
– Enter live at market tomorrow with a stop beneath today’s low, or beneath the gap (in case the gap may still be filled)
– Wait for a retracement towards the gap to achieve a better reward/risk – however your order may not get filled.
The thing to remember about breakaway gaps is they tend to mark the beginning of a large trend, so you could even use a simple buy and hold strategy with a wider stop. Seeing as mining stocks have a large impact on the FTSE then it also provides an insight into how the FTSE (and correlated markets such as US Indices, AUDUSD) may behave. I’ve also included a couple of other mining stocks below that may be of interest.

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FTSE SECTOR – GENERAL INDUSTRIALS (NMX7570)

– Recently broke its Relative Strength descending trendline against the FTSE
– Both markets are currently consolidating, but General Industrials is potentially a market to watch for longs next year
– I’m looking for a close above 2750 to confirm a bullish move within this sector
– Generally correlates with FTSE
– Stocks to monitor: REX, RPC, SMDS

FTSE100: Harmonic Elliot Waves

Harmonic Elliott Waves is a new method of wave counting by Ian Copsey. He’s modified the original impulsive wave structure by using harmonic ratios of the fibonacci sequence to forecast his wave counts. 
I’m working my way through his new book Harmonic Elliott Wave: The Case For Modification of R. N. Elliotts Impulsive Wave Structure so naturally keen to take apply this to the FTSE and see if I can get even remotely close.
I am by no means a master of his method yet, but will continue to study it as the calls Ian has made using his method are truly staggering, and at times his price forecasts on Indices and FX are within a pip.. months before the event happens! I won’t reveal his methods as they are in his book, he teaches a course and he now offers an analysis service. There’s a free introduction on his website with a pdf and video, and is definitely worth a look if you like count waves. 
Assuming FTSE does continue to decline I feel that the 4971.4 is a crucial swing low, so could prove to be an appropriate target as this is also a 50% retracement level. 

FTSE100: Update

So far the FTSE has failed to breach the 6100 area, and very close to touching the previous swing low at 5811. I have chosen a more sensitive form RSI to show the divergence that occurred during the run-up to 6100. Although this may back up my original post on 27th Feb, it is too soon to call for a price reversal.

As price action is within a consolidation, I can pay closer attention to the RSI which is approaching oversold – for this reason I expect a bullish pull-back within the current consolidation, before further declines. It should be noted that the weekly RSI setting is currently at 55 (neutral) so cannot see price going below 5514 unless the weekly RSI approaches the overbought area of 80+. If anything, the current choppy conditions of the FTSE is just a modest correction and expect the bull-run to regain strength and break the 6109 area for another leg higher.

SUMMARY:
Short Term: Bullish within the channel
Medium Term: Bearish retracement below 5811
Longer Term: Bullish and for price to break 6109