Thursday, 29 November 2012

France.. The real weak link in the inner eurozone chain

The CAC40 daily chart
A few weeks ago in the UK several hundred steel workers were laid off when Tata Steel closed several sites in the Wales,UK

SO imagine my chagrin when i read and heard the developing story over the last few days here in France about the proposed closure of 2 blast furnaces at a steelworks in NE France. There was general out pouring of socialist venom in the French press and media saying that AM did not respect France and that Hollande would force a compulsory purchase and nationalisation of the site and expel Mr Mittal!. Monsieur Mittal would be well off out of it in my opinion! and considering he employs a total of 20,000 French workers one has to wonder why he should accept such treatment ? There is a tangible anti big business sentiment growing here in France where many/most workers simply see large companies as a way to provide employment/pensions and contribute taxes towards the state coffers and vast needs for its generous social benifits.Profit does not some into it and many of them would prefer it didnt.

Saturday, 24 November 2012

The rise of electronic high frequency trading displayed in 2 mins

This is a somewhat scary little data movie showing major equity market volumes over the last 6 plus years upto the end of summer/autumn 2012 condensed into 2 mins. It ends as a raging inferno! We have high frequency quant traders and programmers with their filthy algos to thank for this....

PS. watch the BATS.LINK

Wednesday, 21 November 2012

ES + YM..going lower but serious support here ...continued..continued

 As per recent posts the support seen  form the fork below ( and shown in previous posts) seen here with its RL's has provided a base for a decent pivot. The question is where will we run out of energy- if at all? If we do not break higher up to the 1390's to 1400 level we will be going lower and back to test the 1340's again and my bias is just this scenario so I am actively scanning the market for short entry areas using RL/ML's supp/res.
Heres another fork below using my 'FNL' system.
 arithmetic scaling
 Log scaling

and here is the full picture!!:

Friday, 16 November 2012

ES + YM..going lower but serious support here ...continued

If ever you needed proof that multiple PF structures are effective here's price action around the horizontal ML form yesterdays post plus a couple of addition micro forks added to show supp/res even at this low time frame. If you add the reaction lines you get a chart such as the ones below

Here's an update just under 2 hours after the Wall St opening: The reason for posting these isnt to illustrate a profitable open trade ( anyone can do that) but to show how support/resistance (when combined with an indicator based entry method) is a powerful trading tool.


Thursday, 15 November 2012

ES + YM..going lower but serious support here at 1348 ( ESZ12)

Watch the  horizontal ML support price and watch the stochastic ribbons for a short entry perhaps today or tomorrow

Wednesday, 14 November 2012

ES Z12 + YM Z12 continued

In the context of my overall view Click here

Tuesday, 13 November 2012

YM Z12...You have got to love this!!

ES ~f continued and SPY/DIA/QQQ

 Remember this from the previous post? I do not expect more than a bounce then back to this support line ( which is also a .50 Fib RT ( June 4th 2012 to recent high)

 now we have some ETF's and where they look like they are heading

Friday, 9 November 2012

ES Z12 A bounce here...but the carnage will continue.Introducing a new Pitchfork

If you have ever followed my theory on market geometry and PForks/ML's you will know that I think all a PF does is express the relationship between 3 pivots. There are multiple pivots and thus a myriad of forks that can be drawn ( and thats before you even add the reaction/warning lines for each of those individual forks!). The result can be a chart that resembles a birds nest of lines and too many lines to make sense of price behaviour... the message is obscured to most who are unfamiliar with multiple PF/Raction line charts and trading. There are important observations I have made since 2007 that have gone un noticed by others
(past and present) in the same field or those indeed who hold Dr Andrews and others work too sacred to explore the subject further. I am certainly not equating myself with any of these great theorists and market gurus but the power of the modern PC and charting platforms plus custom indicators etc. has made it far easier for the modern chartist to observe, delve, discover, develop and expand new concepts.

It must be remembered that all any chart is a collection of data and the bars/candles etc are just data presentation mechanisms of which the market is not conscious/aware of. We must be extremely careful how we interpret and view this data especially when overlaying that chart data with dynamic linear studies such as MLs' and reaction lines etc. Below is a current example of the E mini S&P using the daily chart ( esignal platform).
The candlestick chart has what i call an unorthodox fork or very nearly a FNL fork (see bottom of this post).
This fork is one that would probably make Dr Andrews ( if he was still with us ) have a coronary but yet despite that P1 is behind P0 it simple represents the relationship with these three pivots alone- nothing more. The fact that they are extremely significant pivots in the daily TF should reveal a greater correlation with price than say 3 pivots in the15 min TF.
We have added the reaction lines at both 50 and 100% intervals of P0 to P1-extended forward into the body of the fork ( and beyond its UMLP/LMLP's). THIS CHART IS IN ARITHMETIC SCALE.

You may look at it and say "well, OK it's nothing special but there is some correlation with price and more so when viewed in the 60 min chart below.Obviously I can see the bounce we are seeing in today's (now) trading session of the lower ML but so what,..the reaction lines seem pretty useless to trade with"!
 In fact we have what could loosely be called by som folk a 'multi pivot line' but are different insomuch that as reaction lines they have a mathermatical/geometrical relationship with the 3 pivots cncerning us, plus we can see the bounce off the LMLP-OK we are agreed so far..
 Now below we change the scale to LOG and something remarkable happens....
here is the 60 min chart LOG scale

Here's the daily LOG scale now we have a much greater correlation with price but we also have price having fallen below the LMLP but can also see price bounced first before passing through lower.This question of Arith or LOG must beg the question: " Where is the true location of a line"? as represented on a chart contrived by us.

.The question is why do we have the same reaction line and LMLP showing two very definitive correlations with price in two very different locations. If you are interested in the answer then subscribe to my free daily charts email (one simple email a day- no spam/offers ot other rubbish) with no strings attached-FREE!

NOW Here is the true FNL Fork i developed on the same chart below. if applying it to an uptrend I take the significant low as P0 then the first higher high of wave 1( before any significant retracement)as P1 then the last low...hence FNL or " First n' Last".
There is a fundamental relationship between these three pivotal highs and lows and if you add the reaction lines you will nearly always find perfect frequency and the FLR ( First Line of Resistance). It works in any time frame as i will show you below. Before we do that here's the detail in 240 min  Arith scale.

Now look at the whole FNL fork in 240-min log- see how the location changes
Here's the daily same FNL fork in LOG...see the distortion of the fork? It reveals price inside its ML's and showing a remarkable relationship withe the ML's and RL's.
I observed that we are always dividing swings into smaller swings and drawing forks within forks yet there exists a powerful & crucial relationship between the first HH of any uptrend and the previous low and last low. Here's a second example in a smaller time frame and using MT4
If you are interested in knowing how 1. I construct charts and 2. trade this type of fork then sign up for my free service