Short Term Trading Idea - H&S falling to Support or 200 MA.

Apr 25, 2018

Head and shoulders almost formed. Looks like we might see it break down to either the 8800 support area or through to the 200 MA (4800 on the hourly) at 8675 around the yellow ellipse. We might see a small bounce up from there, maybe to 9200 at previous support then turned resistance, and then we'll see if that holds or probably more likely we'll go down further likely to somewhere between the 8250-7850 area where we may then resume the uptrend. We're correcting in the short term but should see some good moves up in the long term. There's too much bullish momentum for me to see this making any significant moves down but as we all know in this game - expect the unexpected! I'd actually love to see it head lower for a better buying opportunity though I don't think it will. Maybe maybe 7000 or so max.

Apr 25, 2018

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I forgot to mention the H&S target of 8700 lines up nicely with the 200 EMA. Though note that a move like this would take us out of the large ascending wedge so its possible a break from this might take us further down than the H&S target so trade with caution if we get the break.

Apr 25, 2018

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Neck line broken.

Apr 25, 2018

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We're approaching the edge of the ascending wedge which might stall us. Let's see. Also I misdrew the wedge slightly. Looking at the 9060 level.

Apr 25, 2018

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Bit of turtle necking - poked out and got bought right up. Still, I think its likely we'll break down further. High time for a correction. We have the psychological round number of 9000 to deal with first and then let's see if we break that to the 8700-8800 area and hold that.

Apr 25, 2018

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Out of the wedge! Let's see if we reach the next support level and how it holds. Personally I think we'll get a small bounce based on the RSI then resume the downtrend but that's just my opinion.

Apr 25, 2018

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I was too hasty. Back in the wedge. Too cosy to leave just yet. Looks like we'll hover around here for a bit.

Apr 25, 2018

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Small pennant forming.

Apr 25, 2018

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So we have our pennant breakdown but its being bought up. Lets see where we go from here. If this continues to break down I think the first stop is going to be somewhere between the 8800-8700 range. My idea is we get decent reversal here based on the hourly RSI, but I'm also looking at the .382 fib level around 8500 for a bigger bounce. Then if this doesn't hold I think we're at the 8250-7850 area. Watching closely before I enter a trade to catch a bounce with a tight stop.

Apr 25, 2018

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Just a bit further to the H&S target of 8700. Will we or won't we!

Apr 25, 2018

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We bounced from the support area at 8750. Just shy of the H&S target. I'm not convinced on this yet. I don't think the bounce was strong enough so perhaps another leg down still to go though we're oversold on the RSI so perhaps we'll consolidate around 8900 before we have another go and we might then see the .382 fib around 8500. Remember there was a huge move up with little consolidation in the past week or so which would makes a further drop more likely.

Apr 25, 2018

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Could be another small bear flag.

Apr 25, 2018

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If this pans out the extension of this flag would take us through to the .382 fib.

Apr 25, 2018

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Redrawn the bear flag to a larger wedge. Let's see if it breaks down at the end to the 8700 level or further.

Apr 25, 2018

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Oops, accidentally posted in the comments.

I've updated the chart slightly to show a bear flag in a channel instead of a wedge like I originally thought. Looks like we've made the AB wave of the ABCD correction and are now making BC. Using standard TA rules this should take the price up to 9370 (.618 fib), before we correct again to around 8585 for CD. I think its possible that this is extended to the .382 fib of the whole upwards price move at 8485 which also has some nice confluence with the 50 EMA. Looking to go long between 8500 - 8700.

Apr 26, 2018

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So we came down to the level I was looking for but we had a weak wave up and as a result have come back down to test the 8650 level. I don't think we will hold it and then we should therefore proceed first to the .382 fib about 8500. After this we have the log trendline around 8200 and the 0.5 fib of the whole wave up at about 8050 closely linked with the big round number support of 8000. I think there's a strong possibility that we will show the log trendline as support which may then gives us the legs to head back up.