LunaticTrader

Investing with the Moon

Key reversal levels for week of August 5, 2013

Posted by Danny on August 4, 2013

Our key reversal levels going into next week:

Status Key (W) Mom (W) Mode Key (D) Mom (D)
Nasdaq BULL S: 3342 Up RALLY S: 3568 Up
S&P 500 BULL S: 1579 Up RALLY S: 1673.40 Up
Nikkei BULL S: 12574 Up RALLY S: 13955 Up *
FTSE 100 BULL S: 6284 Up RALLY S: 6522 Up
DAX BULL S: 7891 Up RALLY S: 8209 Up
Bonds (TLT) BEAR R: 115.06 Down DECLINE R: 108.58 Down
Gold (spot) BEAR R: 1431 Up RALLY S: 1288.25 Down
Euro/US$ BULL S: 1.2976 Up RALLY S: 1.3111 Down
Crude Oil(CL) BULL S: 96.08 Up RALLY S: 103.61 Up

(Legend: W = weekly, D = daily, R = resistance, S = support, Mom = momentum, * = change from previous week/day)

(for more details about these levels, see: https://lunatictrader.wordpress.com/key-reversal-levels/ )

Important developments last week:

* All covered stock markets are now back to upward daily momentum. This means the rally continues. When we see the momentum turn back down it will be time to look for a potential top again, using the trailing stop we described a few weeks ago.

* The Nikkei closed below its daily key level last Monday, so it went into decline mode. But only briefly as it has climbed back into rally mode on Friday already.

* Bonds (TLT) remain with a fully bearish picture. So we continue to wait for the daily momentum to turn up, which is usually the first sign of a possible bottom.

* Gold has come under pressure since it went into rally mode a few weeks ago. The daily momentum for gold has turned down on Monday and remains down, which means that gold is still at risk of falling back into decline mode. On Friday it tested its daily key level, and closed well above it. It will now take some strong days next week to turn the daily momentum back up, otherwise we may be going to a retest of the recent lows for gold.

* The Euro/US$ has seen its daily momentum turn down again, and is now at risk of going back into decline mode next week.

* Oil (CL) closed just below its daily key level last Tuesday, and snapped right back the next day. This happens sometimes. The daily momentum for oil has turned up, so we have a fully bullish picture in oil again. It will still need follow through next week, otherwise this bounce will be forgotten quickly.

Good luck,

Danny

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