Saturday, March 5, 2011

(Video) Quantitative Easing Explained!

Friday, March 4, 2011

S&P500 Short-Term: Bearish Wedge

Not to swing at every pitch requires a lot of discipline. If one takes only the best setups, with a safety margin, one can't go too far wrong. (Sounds like value investing, doesn't it?!) The S&P500 maybe providing a short-term bearish opportunity. First, here's the Daily chart:

My last update noted a trendline break with support at 1300, and suggested that we might see a shorting opportunity. Since then prices have whip-sawed impressively, and failing at the back-test of the broken trendline. Thus resulting is what could be a bearish Rising Wedge, as shown on this 30-min chart.

Top of the wedge is at 1332, bottom is the rising trendline. A break eitherway could be bullish/bearish. But Elliott Wave Theory suggests that after an impulsive decline and a corrective upmove, there should follow at least another impulsive decline.

1. Taking a short-position at the top of the wedge, with RSI close to 70 on the 30-min chart(for margin of safety), with a suitable stop just above. In case of decline below the lower trendline, looking at a target of around 1275.
2. In case of a break above the wedge, i won't be taking any long positions until clear of recent highs.

Wednesday, March 2, 2011

Apple iPad2 Poll: Fibonacci in Action!!!

Was just browsing and in this poll on MW, the respondents exhibit an almost perfect Fibonacci ratio (Golden ratio), in response to the question! An almost perfect 61.8-38.2. A Coincidence you think? Or is it the law of nature in action? Keep in mind that the poll does involve a big "herd" of respondents, and it does involve speculation!!

Monday, February 28, 2011

Asia: Some Bullish Breakouts UPDATE

Refer to this earlier post entitled, Asia: Some Bullish Breakouts!, wherein some leading asian indices were highlighted, when they achieved breakouts to new highs. They have regressed enough to cancel the long trades. Moreover, all three charts have violated the uptrendlines, implying more corrective action ahead. Once again, this case highlights the importance of a stop-loss strategy before embarking on a breakout trade. Here are the updated charts, with suggested support levels.

1. South East Asia

 2. Malaysia KLSE

3. Korea KOSPI