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Tuesday, 26 January 2016

DOW and NASDAQ correction to continue

Click on chart to enlarge.

Last week's rebound in the markets was short-lived and both Dow and Nasdaq are again losing ground.
Reviewing the long-term patterns, there is considerable scope for further correction, and few hopeful headlines in world economics.
The Bear Market is likely to continue for the rest of 2016.
The chart shows the Dow in red (both graph and trend lines) and the Nasdaq in blue. Both have already fallen by 12% since November. The Dow will probably have fallen by about 25% in all by the end of 2016 and the Nasdaq by 32%%, as indicated by my curved arrows.

Friday, 22 January 2016


This could be the bottom of the current downtrend.
The graph dipped momentarily to 4000; but the realistic bottom was 4100.
Next resistance point around 4400.
Looks like January will finish lower than it started: signalling an overall Bear Market for the year. Then I will expect the downtrend to resume when the graph hits Resistance Line R.

Thursday, 21 January 2016

EUR/USD upslope defined

My last post anticipated a possible lowering of the bottom of the current swings and wondered if the new bottom would fall as low as my green dotted line.
The new bottom did not fall that low and seems to define the Support Line for the emerging uptrend.
It is a fair bet that, for the coming while, the graph will stay within the range depicted by the purple box and that the emerging uptrend will be sliighty steeper than my previous prediction.

EUR/USD shor-term doubt

The "Lowest Bottom" line joins the lowest bottom in 2001 to the lowest bottom of 2015 (3 Dec 2015). A strong bounce ensued when the graph hit this line.
The "Overall Upslope 2016" is drawn in parallel to previous upslopes and is my attempt at predicting the overall upslope of 2016. An uptrend is necessary because the Euro  is undervalued viz.a viz. the US Dollar.
The green triangle encapsulates the movement of the Chart since the spike of 3 Dec 2015.
This month (Jan) saw the chart break gently out of this triangle to indicate the present range. The bottoms of the upswings of this month have been rising, but the tops have remained level. Either the top line or the bottom line must soon give way.
It remains to be seen whether the movement will stay within the purple box or drop the bottoms to the dotted green line. Long term bullish , but short-term undecided.

Tuesday, 19 January 2016


The Nasdaq downswing may be bottoming out. My original target of 4060 may be correct after all - for now anyway. I am happy to exit my short now and wait to see what happens. It is quite likely that there will be an upswing soon. When the upswing reaches 4400, the question is "will it continue, or will there be another downturn?"

Friday, 15 January 2016

EUR/USD to rise more steeply

By previous long-term patterns, the green dotted line seems to be predictive of the upslope of the Euro  against the US Dollar  in the coming year. Having hit a peak on 9 Dec 2015, the security has been gently sloping downwards towards this Support Line. However, it has raised its bottom and appears to be unwilling any longer to be constricted by the top of the green triangle, indicating that it may, for the next few weeks or months, be inclined to stay within the purple-shaded channel.

Wednesday, 13 January 2016

DOW: How Obama saved the Markets

On taking office in Jan 2009, President Obama introduced Quantitative Easing and Zero Interest Rate Policy, immediately stimulating the markets into recovery from the economic collapse of 2007/ 2008. Money was induced back into equities; share prices followed a steep upslope, (with economic recovery following), until QE  and ZIRP ended in 2015. The correction marking the end of QE and ZIRP may not be quite complete, but the resumption of a normal upslope is imminent if not already begun. Obama economic policies were successful.

Friday, 8 January 2016

DOW correction is complete but overshoot likely

The Dow Industrials Index  correction is more-or-less complete, since the graph is about to strike Support Line A. However, it is quite likely to overshoot a bit and bounce off Support Line B, before resuming its upward march. Line A will then psrovide the natural slope for the .coming year.

NASDAQ to have a little bounce now

Nasdaq 100 has strayed past my Support Line P and is due a little bounce now. However, it will hardly bounce very high, but come back on track to continue its correction along Support LIne P.

Euro has had its bonus spike

EUR/USD  has had its bonus spike. Now let's observe it settling back into the track we have laid for it.

Wednesday, 6 January 2016

NASDAQ downtrend to continue

I believe that short-term Resistance Line R will guide the downward movement of the NASDAQ 100. Any swingback from short term Support Line P towards R will be rather weak, and the downtrend will continue until about 4062.

EUR/USD emerging channel

Down now from its December spike, the Euro (against the US Dollar)  looks like settling into the emerging channel defined by the green lines (dotted Support Line and continuous Resistance Line) Another spike would be an added bonus.