Daily GJ Technical Analysis

Just realized that today is:

• the last day of the month....
• the last day of 1st quarter of the year.....

Going to stay out the whole day. Quarter-end accounts closing might cause erratic price actions due to profit taking and/or loss cutting activities.

chart h1 at 9 pm Malaysia

A shooting star candle has formed on the hourly chart. Price was rejected by the 61.8% fib level.
Already moved SL to +5; now this is a free trade.
My possible target is 132.80.

UPDATE:
 11.30 pm - went down about 60 pips and reversed
            was stopped out at +5
            will continue tomorrow 

chart h1 at 10 am Malaysia

Looks like the price is going to test the crucial support level at 139.00. Should the level penetrated, 136.6x (which is the 161.8% fib level) might be hit soon.

UPDATE:
  4.00 pm - was away from chart
            136.00 hit 
            done for the day 

weekly and daily chart at market closing

Since the bulls could not sustain the price above 142.00, it seems that the inverse head and shoulder pattern is invalid; and the anticipated trend reversal failed to materialize; at least for now.

Meanwhile, the long wick of the weekly candle indicates that the bears are in temporary control. My immediate target is the bottom of the lower trendline (136.xx).

Should the beast penetrated the lower trendline; then, in my humble opinion, the bearish flag pattern on the weekly chart is validated and there is a possibility that 119.00 would be tested again within a couple of weeks.

The bears look strong and trying to push the price back into the war zone. All this while, I doubted the validity of the inverse header & shoulder pattern as the upwards thrust after breaking the 142.00 resistance lacked the required momentum.

Should the pair close below 138.20, the weekly candle would closed as a shooting star; and next week should be a bearish week. However, the bears still have to be break 136.00 in order to gain full control of market.

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8 pm Malaysia

A bearish harami candle has formed on the daily chart. At most, it indicates that market is still uncertain on the next direction. Unless yesterday's low (140.98) is broken, the bulls are still in control.

Better wait for further confirmation.

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Price is approaching 142.00 level.
Should the price bounces upwards, the trend reversal is most likely confirmed and 150.xx is possibility.
However, if the level fails to hold, then 136.xx should be the next destination.

Good luck and happy trading...

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The price is already in the bulls territory.
Treasury Announces $1 Trillion Public-Private Plan to Buy Banks' Bad Debt
Is this a "buy the rumour, sell the fact" situation??

Happy trading and good luck...

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Daily chart at market closing

Price is currently in the war zone - where the bears and bulls are fighting hard to gain control....

Better be patient and let the market shows us the way.... below is another daily chart showing the MAJOR trendline and a crucial resistance level:



My pick : sell limit at 140.20 ; stop loss 142.00 (risking 1.5% of my capital)

If there is no analysis coming on in this blog next week, I might be holidaying somewhere in Jakarta and Bandung....

When trading using chart patterns, bear in mind that pattern failures do occur and "a pattern is not a pattern until it is completed".

For example, the inverse head and shoulder pattern has eight basic components before the pattern completes; namely:

1. A prior downtrend
2. A left shoulder follows by a correction rally to the neckline
3. A decline to a new low to form the "head" portion
   
4. A rally towards the neckline again
   
5. A third decline to the right shoulder
6. A break above the neckline and forms a new high
   
7. A throwback towards the neckline
8. A rally upwards and breaks the new high resistance
   

Only after ALL these components are completed, the bulls can come in and declare victory.

Otherwise, the prior trend should be considered as remains intact.

IMPORTANT NOTE: a price close below the neckline will invalidate the inverse head and shoulder pattern.

Below is the daily chart for comparison purpose:

daily chart - 6 am Malaysia

A bearish candle has formed on the daily chart and the price is below the confluence of the two trendlines. Will the beast continue tanking?

UPDATE:
  2.00 pm - looks the bears are getting stronger
            should the lower trendline gets broken, the beast might 
            try testing 131.50 and 127.50 next 
            see the h4 chart below
     
  6.00 pm - was away from chart
            price went up and hit my SL in green
            will stay out for time being

chart h1 - 10.50 am Malaysia

The beast is hibernating now. So, why not we do something else?

I will stay out until the beast wakes up and shows me the next direction.

UPDATE:
  6.00 pm - fall asleep just now and just opened up the chart
            wowww... the beast has waken up and the direction is 
            clear now
            went short at the close of h4 candle with a possible 
            target at the lower trendline (133.50)
            see the h4 chart below
    
  10.00 pm - looks the market is in uncertainty now
            -10 pips after 4 hours 
   2.15 am - FOMC statement spiked the beast down for 200 pips
             stopped out in green 
             done for the day
             meanwhile, look at the daily candle
             you should know the beast's direction tomorrow

chart h1 - 11 am Malaysia

Price is now below the yellow lower trendline. Now watching closely whether the bears could push the baby below 138.89 or not.

Should the support broken, the beast might test yesterday's low and then 133.40 (161.8% fib level).

Let watch and play it by ear....

UPDATE:
  1.15 pm - my last night sell position stopped out in green
            stay out for time being
            not need to rush and chase the pips...
            an advise from a pro trader 
            "Most people are trading for the adrenaline rush rather 
            than the boring concept of just maximising 
            profits." - Jacko 
  3.00 pm - two bearish candles already formed on the hourly chart
            will the beast continue downwards journey? 
            hope it will not reverse and hit my SL 
   
  6.00 pm - some news releases pushed the price up
            stopped out at +10
            done for the day... 

chart 30 min -3 pm Malaysia

Franfurt market pushed the beast up to Friday's high and seems that the bears are still alive. However the price still need to break the lower trendline for the confirmation that the bears are taking over the market.

Let's see where the beast will go next....

UPDATE:
  4.00 pm - stopped out at +5
            will wait again...
  4.15 pm - bulls still persisting
            I go bowling first 
  9.00 pm - a possible reversal candle has appeared on the 
            hourly chart
            price slightly missed the 161.8% fib level
            went short at 139.59; SL at 140.07 (48 pips risk)
            see the h1 chart below
  
 10.00 pm - +56; SL rest at +1
 11.00 pm - +115; Sl rest at +30
            on the h4 chart, the price was rejected by the upper 
            trendline and an evening star formation is in progress; 
            which is a strong indication that the price might 
            continue tanking....
            see the h4 chart below
     

chart h4 - at market close

Look at the accuracy of the fib retracement levels. The price obeyed the 161.8% level and then went up and stopped at 50% level.

Below is my analysis of the possible move for next week...



An evening star formation on the weekly chart indicates that the downwards move is not over yet. As long as the price remains below 138.45, I will keep looking for sell entries with a possible target of 126.60.

On the other side, a break above 142.00 will invalidate my view.

Good luck and happy trading....

chart h4 - 3.30 pm Malaysis

Price is in tight 150 pips range between 135.20 and 136.60. Even though there is a hammer candle on the daily chart, I am still maintaining a bearish bias due to the developing evening star formation on the weekly chart.

Thus, my strategy today is to wait for a bull exhaustion confirmation before riding the south-bound train again. Otherwise, I would rather go bowling....

UPDATE:
  4.15 pm - price broke upwards...
            I am staying out 
  9.00 pm - at last the beast starts moving
            went short as the price is rejected by fib 138.2% level
            will the beast start tanking?
       
 10.00 pm - choppy price action
 12.15 am - now drops to 136.85; already locked some profit
            will leave it open over the weekend
            done for the week 

chart 15 min - 1.00 pm Malaysia

I am getting bored as the beast is so predictable....
The above chart shows my two sell entries based on the price action around the fib levels....

It is amazing to see how the beast respects the fib levels, isn't it?

Note: In contrary to the popular practice of plotting the fib retracement according to previous swing hi/lo, I plot mine according to the previous day hi/lo.

UPDATE:
  4.20 pm - London market pulls the baby down... 
            132.50 now 
  4.45 pm - London bridge is falling down... falling down

The following comment from an anonymous reader on my "bye, bye... bulls" post prompts me to re-evaluate the larger perspective on the beast's future possible direction.

Good job!
I want to know why the beast go south since it has up break the triangle about two weeks ago you mentioned.
Should it go down 600 pips, I think those long term traders who buy at the breakout of the triangle and set the target at 150.00+ would be stopped out at 132.50.What a pity! That is unreasonable! How to explain it?

This chart below might throw some lights on the "conflicting" chart patterns analysis.



It seems that the price is making a "throwback" move toward the red trendline at 129.50 area before turning upwards again. In case this happens, both the triangle (to me, it is an inverse head and shoulder) and the double top patterns are still valid.

I am not an expert and is still in learning curve. I might be right and I might be wrong too.