PRECIOUS METALS (WATCH)

We have several momentum trendline breaks across the precious metals universe (Gold, Silver and Aussie Dollar) warning of further short-term downside. Gold (XAUUSD) and AUDUSD have already weakened and lost around USD 50 respectively 300 PIPs or roughly 5% from their most recent peaks whereas Silver (XAGUSD) has remained solid at its intermediate highs (15.50ish).

Provided with these drops in Gold and the Aussie Dollar, Silver seems now to take a similar path as its two companions and could drop half a dollar (~5%) till it finds some bottom in the USD 15 area acting as make-or-break area. If 15 holds, one can expect a re-test of the recent highs at 16.36 and possibly even higher highs to 16 3/4. In the case Silver falls below this support, next targets would be 14 (-10%) and 13.40 (-13%).

With the bullish break-out beginning of October 15, Gold (XAUUSD) was able to print fresh 4 month highs but was not able to remain above 1190 and is now taking a breather. Trading now at 1142, Gold could drop another USD 20 (to 1120) before we could see a very strong rebound to 1200 area or even 1240 levels. Nevertheless, we think 1120 will hold but still remain cautious due to its most recent breach of the momentum trendline (warning sign). Should Gold drop below its very important support level at 1120 (Jan 15 downward trendline), further downside to 1060 area could be expected.

The picture of AUDUSD is very simliar to the one in Gold (as usual) and also another short-term drop of roughly 150 PIPs seems inevitable. The levels around 0.70 act as major support zone and are likely to be tested ahead of another bull attempt to 0.74. If it fails to rebound, 0.69 / 0.67 seem as legit downside targets.

Conclusion: Too early to chase upside again in Gold, Silver and AUDUSD. Do not yet cover your shorts but remain cautious. Key make-or-break levels ahead!

XAUUSD-01112015 XAGUSD-01112015 AUDUSD-01112015

 

GPRO (IDEA)

In GoPro, Inc.  (Unfortunately, we could not get stock quote GPRO this time.) we have multiple signals in place suggesting of an intermediate trend reversal ahead with 20-50% upside.

Firstly, GoPro, Inc. has been trading within a falling wedge formation since early September this year. A falling wedge formation mostly signals the end of a trend and if valid, is followed by a strong and rapid counter reaction to the beginning of the formation. In the case of GoPro, Inc. the upper trendline of this falling wedge formation has been penetrated today (daily chart) and a warning sign was given last Friday (hourly chart) where we have a very similar formation in place. Furthermore, the momentum (RSI) has been diverging vs. price since almost the beginning of this pattern (daily chart) and acts as a serious warning sign that the trend is weak and could likely come to an end soon. Last but not least, the new momentum highs are align with the price action (Hourly and Daily chart) as well as with the latest strength and upside break-out in Nasdaq Composite Index.

One could go LONG at current levels (29.20 or above USD 28) with a risk stop at 26.16 and a profit limit at 37.24 (1 month, ratio 2.50, +27%) / 43.55 (1-3 months, ratio 4.50, +49%).

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TA Weekly – 37/2015

Along with our last week’s roadmap, USDCHF, GOLD, COPPER, CRUDE OIL WTI printed new highs meanwhile the Treasuries (Bund & US 10Yr), EURUSD, EURJPY, GBPUSD, AUDUSD slipped to lower levels and Equity Indices remained in consolidation mode as anticipated.

Highlights (Week 37):

DAX30 – make-or-break!
SMI – caught in the middle.
S&P500 – 1920 to hold?

EURUSD – further downside to come.
GBPUSD – to bounce or not to bounce?
EURJPY – bottom in sight?
USDCAD – do not chase upside!
USDJPY – was that the top?

GOLD – too early to turn bullish.
COPPER – bottom found?
CRUDE OIL WTI – to proceed its bounce?

…and more!

TA Weekly – 36/2015

As anticipated in our last week’s “Technical Weekly”, we expected further downside in DAX30 and SP500. Also according to our last weeks release, the German Bund and US-10 Year Notes have proceeded to higher highs along with EURUSD, USDCAD and Gold. Moreover, Crude Oil WTI has reached our suggested support at 38 and rapidly rebounded as expected. For the upcoming week, we have several make-or-break scenarios especially on the Equity Indices side.

Highlights (Week 36):

DAX30 – retest of recent lows to be expected?
SMI – is the panic over? New highs in sight?
S&P500 – trading at 50% retracement, now rebound to all-time highs?

GERMAN BUND – to proceed to higher highs?

EURUSD – to drop to 1.09?
EURCHF – swiss franc to weaken further?
USDCHF – parity in sight?
USDCAD – sky is the limit?

GOLD – proceed its rebound?
CRUDE OIL WTI – bottom found?

…and more!

SCHP (WATCH)

In the stock of Schindler Holding AG a corrective flag pattern is in place which is corrective. Momentum moves with price and remains healthy. If price does not fall below and remains within the flag trend-channel, one could go long once a higher high is in place (~CHF 169.00). The projected upside profit target would be at least CHF 200.00 (+18%) whereas the lowest low of the channel should be taken as a risk stop.

schp

EURJPY (WATCH)

In EURJPY we have a falling-wedge triangle formation in place which has an exhaustive character. It usually signs the end of a move of one larger degree and leads to a fast and high-volume driven move in the reverse direction of the occurring trend. In the case of EURJPY, the momentum troughs no longer confirm the latest price lows (see yellow lines in RSI & MACD). These divergences have to be taken as a serious warning and not as trading signals. One should always wait until the price breaks out and confirms the recent warnings in momentum indicators.
Should EUR strengthen against JPY and break out of this triangle formation, one could place the risk stop just below the 2-year low at around 126.09 (-2%) and set the profit target limits at around 141.75 (+10%) / 150.00 (+16%).
141.75 signs the “beginning” of the falling-wedge formation which provides an initial indication of the first price target whereas 150 is the multi-year (6 years) top confirmed with a high-momentum peak. Take in mind that a trend never ends with a peak in momentum and therefore always needs a higher high in price unconfirmed by momentum before it finally breaks its trend and reverses.

EURJPY-daily
EURJPY-daily-long

DAI (IDEA)

In Daimler (DAI – Xetra), we have a shoulder-head-shoulder reversal formation in place supported by above average volume and a retest of neckline (dotted line). This suggests of further near-term downside with a minimum target of around EUR 82.50 (-6%).

We therefore go short here at current levels (87.86)

Profit Target: EUR 82.70 (5.87%)
Stop-Loss: EUR 89.95 (2.38%)
Risk/Reward ratio: 2.46
Horizon: < 1 month

ADS (WATCH)

Adidas seems to have found some bottom after the shoulder-head-shoulder top formation downside target at around 53 was reached. Meanwhile the price has nicely reversed in form of a double/triple bottom formation and the massive gap is being closed as well. If ADS can finally breach the upper line of the gap (>70), it suggests of a price target of at least EUR 79.00.
Momentum confirms the current (new) highs and we only wait for the gap resistance line breach and high volume to confirm the break-out!

EURUSD (WATCH)

The long enduring downward trend in EURUSD is very likely to have come to an end. These days, EURUSD is facing some sidewards distribution in form of a triangle formation. In most of the times, a triangle formation suggests of a continuation of the previous trend (which would be obviously downwards in the case of EURUSD), BUT a breakout out of the triangle formation within two-third or three-quarter of the whole formation (absolute low until apex) is crucial to confirm this continuation pattern as valid. Meanwhile we have pretty much passed these gauges and we would absolutely not be surprised if EUR strengthens against USD significantly! If EURUSD breaks out to the upside out of this triangle formation, we can expect a move to at least 1.2580 which is roughly 10% higher to where we are trading now.

If you do not want to wait for the breakout (confirmation), one can go long EURUSD at current levels (1.14ish) with stop-loss at 1.1088 and target at 1.2550.

FRE (IDEA)

We see an almost picture perfect head and shoulders reversal formation in Fresenius (FRE) with a top at 51.66. We go short here at current levels (47.24) with a profit target of roughly EUR 4.00 suggesting FRE to find bottom at around 43.00.

Target Limit: 43.20 (EUR 4.04 / 8.55%)
Risk Stop-Loss: 49.25 (2.01 / 4.25%)
risk/reward ratio: 2.00
Horizon