Sunday, May 17, 2009

Technical Picture - Profit Taking

Before I left for vacation we said that the S&P was forming an inverse H&S bottom and that we expected some symmetry (matching congestion) areas on the way back up. That's pretty much how it played out as we can see from both the weekly and daily timeframes.

Taking a closer look at the daily, we note that last week's profit taking was on lighter volume, and thus implies, that the rally is not over. I'm watching support at 875 as we consolidate between the two blue line segments. I wouldn't be surprised to see prices rally to test the January highs before beginning the longer consolidation process of carving out the right shoulder in the inverse H&S bottom.

The $USD took its sweet time before finally succumbing to a trendline breach. Thus far the breach is minor and could easily bounce for a retest. If so, gold and commodities, which rallied on USD weakness could come under short-term pressure.

Oil, is already pulling back to retest it's BO point.

Gold consolidating at it's base. I like how all of the moving averages have formed a bullish cross.

The rally in financials is also consolidating just below the downsloping 200 DMA.

Jim did an awesome job on the blog while I was away and I really appreciate it. The depth and variety of content is great and I look forward to more if he has time. Read his post below for analysis of key technicals in play.

In the next week or so I plan to respond to emails piling up over the last seven weeks. I'm feeling really jet lagged so I expect things will be a little slow in the next few days.

Good Trading!


TraderO7 said...

Nice to know you're back Jamie. Been waiting for your trading lessons. I learned a lot from your post and from Jim. Your blog is quite different from other bloggers out there. You really provide a unique kind of education especially for us who are new in trading. Thanks a lot Jamie.

Day Tradr said...

Welcome back Jamie. Hope you had a great vacation.

Anonymous said...

Yes indeed - welcome back Jamie. That was my first "almost full time" try at blogging. It takes a great deal of dedication and I now have even more appreciation for what Jamie does on a daily basis (for free).

Stewie said...

welcome back buddy. Just so you know Jim did a great job of representing the blog in your absence.

bl said...

Welcome back just as we reversed at the 200ema. Planned? Thanks to Jim for coming off the bench and doing a well done job.

TJ said...

Thanks guys,

The vacation was great, and even managed a few swing trades while I was away.

Yes, Many thanks to Jim who did a great job with the blog. Subscribers are up which means his brand is in demand. I know how hard it must be to find time for blogging when you have a full-time job and family. Much appreciated!!!