Last Chance: 7th of September will be the last chance to join TMS via our Special Rate Annual Membership offer after which annual subscriptions will be closed throughout 2010 & will reopen at some point in 2011 next year. Join us exclusively now at virtually less than $17 a month for full access to our private member content.
"Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway." ~ Warren Buffett
Well Labor Day vacation had the real trading action starting on Tuesday for this week and with it most markets have printed declines. Are these for real or is the action simply an illusion?
Dow Jones
It is hard to say as September can normally be tough month for stocks. Last week our members were informed of advance to occur from under 10000 in which new lows will not materialise but furthermore we stressed how markets can pump up and u-turn later in the month. The question, we are now in the second week of September so is the u-turn decline underway?
It is hard to say at this stage. The Dow Jones has moved 100 odd points lower from this recent high and the market is now becoming a little oversold. Is the downside near completion though? Again this is also a tough question as the markets can simply perform an easy you turn. Although the Dow has become a little oversold it is not yet over extended and can still fall further to mark its bottom. We would like markets to move higher and acknowledge some kind of resistance point again in which they could simply reverse from in hard hit fashion.
The Dow Jones is at around 10350 so a 50 point move higher would have us only 50 points away from Fridays highs and that is why today's decline is nothing to shout about. If the market produces another decline then the questions & answers will have deeper consequences in relation to the markets short term direction and plan.
Euro Four Hour Chart
The Four Hour chart above shows two red lines in which the market has literally been travelling in a 300 point range for almost a month now. The tighter the range and the longer length of time it spends within the range equates to one thing and one thing only: A BIG MOVE is about to kick-off
Clearly the Euro has problems at 129 and as a result of this resistance the market simply dropped back below 127. The question is do we break the range to the upside or the downside? In fairness we are not speculating as the market, the chart and its price must decided where it will take us.
However the Euro has become very over extended in a short space of time and with this a decisive regain of 127 would have the market move higher in u-turn fashion in conjunction with today's move. The risk of course is that the market is starting a deeper correction in which the market falls below the low of August 24th.
Either way we have two support lines which are denoted by the blue lines. We can basically stop right here at 12677 and start this bounce/u-turn or we will start to head towards 126 in which support of the lower blue line will start to coincide with the lower red support line in which a triple bottom could emerge.
Sterling
The pound made a new recent fractional low today in which the values of this low haven't been printed since the 23rd of July. Does this mean we fly to 150? Not at all, it would be important for the Sterling to hold Tuesday's lows but the market would be within touching distance of regaining the pivotal 154 mark again.
The Four Hour chart above shows the blue support line. Although the market has made a new low on Tuesday, the pattern still has the Sterling holding on in which regaining the yellow line at 154 would be important if the market has any chance of attempting an upside break of the red downward sloping line.
We are one day in on this short trading week in which the markets have some critical price action to present its audiences with. At this moment in time and as we're aware how harsh the month of September can be for many, this is why TMS will say that nothing is conclusive so far based on Tuesdays declines.
Of course as always we'll be following our TMS system signals that produced 886 points in August & 704 points already racked up for September!
My name is Ajit Singh and my work with the financial markets started from the young age of 17. We are www.tradingmarketsignals.com and so far in August our TMS system has gained 886 points(Closed signals) from five major markets: Dow Jones, Euro, Sterling, FTSE100 & Crude Oil in addition to which some gaining signals are still open with more triggers taking place this week!
This is it: 7th of September will be the last chance to join TMS via our Special Rate Annual Membership offer after which annual subscriptions will be closed throughout 2010 & will reopen at some point in 2011 next year. Join us exclusively now at virtually less than $17 a month for full access to our private member content.
http://tradingmarketsignals.com/#/tms-annual-membership-offer/4542738012
