Markets In Play

There's some really good price moves happening in a few markets.  We have a confirmed head and shoulders top pattern in the Euro.  For more analysis on this, please check my article on Inside Futures.  

The Australian Dollar is seeing very bearish action coming off its 9/8 high.  Since then, we have a dominant measured move (DMM) with a shallow retracement (under 50%).  This supports bearish action.  We have a possible supporting measured move (SMM) forming as well.  If we get a move below 0.7621, then it will also have a shallow retracement.  These two combined measured moves would support a move down to a minimum of 0.7501 to 0.7451 before taking out the 0.7726 high (assuming we get below 0.7621 first).

The Dollar Index is seeing similar price action to the Australian Dollar, only to the upside.  Coming off the 9/8 low, we have a dominant measured move (DMM) with a shallow retracement (under 50%).  This supports bullish action.  We also have a possible supporting measured move (SMM) forming.  Together, it signals a move up to a minimum of 95.895 to 96.50.

Finally, Gold is seeing bearish trading since its 9/8 high.  If we get a move below 1262.80, then a dominant measured move (DMM) would have formed.  This supports further bearish action.  Initial downside target would be 1245.90 to 1229.30.  I would expect a possible bounce from these levels, but the short side play would stay intact.  Eventually, my analysis sees a possible move lower to 1208.80 or below.

Orange Juice

There are 2 possible bottoming patterns developing on the OJ continuous contract.  First, a double bottom pattern will be confirmed with a close above 143.05.  The target would be ~ 158.10.  Second, a head and shoulders bottom pattern gets confirmation with a close above the downward sloping trend line.  It's target would be ~ 157.10 or less, depending on it's breakout level.  Supporting these bottoming patterns are bullish divergence on the RSI and a COT 52 week extreme short position.  Overhead challenges include the MR1 @ 141.17, the 50 DMA @ 142.76, the MR2 @ 149.78, and the 100 DMA @ 152.90.

Euro (update)

Here's an updated analysis on a possible reversal pattern forming in the Sep Euro...

The Euro has been trading higher since its Jan 3rd low of 1.0500 on the Sep contract.  This recent uptrend has a dominant MM with deep retracement and 19:17 right-handed skewing.  The 1st level supporting MM has deep retracement with 10:10 neutral-handed skewing.  Together they create my Fade Zone (1.14665 to 1.22354).  Because both retracements are larger than 50%,  I consider this a weak uptrend that should produce a nice downside move if a high is established within it.  In addition, there's a 2nd level supporting MM with a shallow retracement and 3:3 neutral-handed skewing.  This last piece provides a Fib extension of its own from 1.1393 to 1.1762.  It's this last MM that could help narrow down my overall Fade Zone.  Overlapping the two gives me the 1st area (1.14665 to 1.17620) that I will focus on for a possible bearish trade.  Finally, on the weekly chart, there's a bearish MM Pullback pattern developing.  The resistance zone is between 1.14812 and 1.15631 (red box in chart).  That could end up being the sweet spot.

Possible Reversal Patterns in Swiss Franc, Euro, and Dollar Index

There are a few potential reversal set-ups taking shape in the Swiss Franc, Euro, and Dollar Index.  I will give my initial analysis on the June contract, but ultimately would probably play out on the September contract.  First, the Swiss Franc shows a possible topping zone between 1.0540 and 1.0818 with a potential sweet spot in the 1.0727 to 1.0818 area.  The dominant and supporting1 measured moves both have deep retracements, which signals a weak uptrend.  If a reversal happens in my resistance zone, then I would expect at least a 50 pct retracement.  The most recent leg up, off the 5/11 low, will have a supershallow breakout with a move above 1.0335.  That is very bullish and could be the trigger to drive prices up into my resistance zone.  However, any bearish trades will need more supporting data.  On the flip side, you could also play into the possible upside breakout.  Entry would be above 1.0335 with stops below 1.0208.  Upside target would be at the low of my resistance zone ~ 1.0540.

Second, the Euro shows a possible topping zone between 1.14336 and 1.18704.  The dominant and supporting1 measured moves both have deep retracements, which signals a weak uptrend.  If a reversal happens in my resistance zone, then I would expect at least a 50 pct retracement.  The most recent leg up, off the 4/10 low, shows a shallow MM along with another possible shallow MM.  This is very bullish and could drive prices up into the upper end of my resistance zone.  Any bearish trades will need more supporting data.

Finally, the Dollar Index shows a possible bottoming zone between 94.471 and 93.082.  The dominant and supporting1 measured moves both have medium deep retracements or worse, which signals a weak downtrend.  If a reversal happens in my support zone, then I would expect at least a 50 pct retracement.  The most recent leg down, off the 4/10 high, shows a neutral MM along with another possible supershallow MM.  This is bullish and could drive prices down into the lower end of my resistance zone.  Any bullish trades will need more supporting data.

Heating Oil (final update)

Heating Oil created 3 different bullish patterns in late March.  A double bottom, a MM fade, and a MM pullback.  The targets of the double bottom and the MM fade pattern were both reached.  However, the MM pullback trade failed to reach its target and is no longer active.

April 8 post:
This past week saw heating oil reach its MM Fade pattern minimum objective and its double bottom objectives.  Next up is the MM Pullback minimum target of 1.7122.  Prices are currently above all 4 moving averages, but found resistance at a 461 Fib extension from a small MM pattern.  There's also upside resistance from a volume @ price range between 1.6415 and 1.6720.  In this range, there's a monthly R1 pivot that could cause a pullback.  Over all, this pattern is still looking very good with lower support between 1.6000 and 1.5685.

Gold (final update)

Gold traded into the 1293.30 to 1313.20 range on April 17th, meeting the minimum target, and has since traded back below the 1241.40 low.  This pattern is no longer active.

April 11 post:
Gold triggered a MM Pullback buy entry today with a strong breakout.  It closed above a 4 point downward sloping trend line and was the highest close since November.  Its high was just shy of the monthly R1 pivot and looks to be headed toward my target range of 1293.30 to 1313.20.  Entry price was @ 1259.00 with conservative stop @ 1241.40 and aggressive stop @ 1248.10.

Gold (final update)

This pattern was never triggered and is no longer valid.

April 30 post:
A possible bullish Fib Cluster Pullback trade is developing in Gold.  The Fib cluster zone is currently between 1264.20 and 1253.20.  It contains a combination of 3 Fib retracements or extensions from a dominant MM with neutral retracement and a supporting1 MM with supershallow retracement shown on a daily chart.  Further supporting this zone is a previous 4 point downward sloping resistance line that is now serving as support, a 6 point upward sloping trend line, and a previous swing high trend line.  Prices are still also above both the 50 and 100 DMA's.   A move above 1272.80  triggers a long entry with stops below 1253.20.  Target1 @ 1294.40, target2 @  1300.90, and target3 @ 1307.70. 

Copper (final update)

The head and shoulders top pattern finally reached its objective of 247.30 yesterday after 44 days.  It definitely would have been a tough hold as it took heat on 4 different pullbacks.  However, the market did ultimately trend down making lower highs and lower lows.

T-Bond

A possible bullish MM Pullback trade is developing in the T-Bond.  First, this pattern relates to a MM breakout pattern seen on a daily chart.  This MM has a supershallow retracement, which is bullish, with 4:1 right-handed skewing.  Any pullback within the 38/78 retracement area is considered a potential buying opportunity.  My MM Pullback Zone is from 152.25 to 151.3125.  Supporting this potential pullback trade is that prices are above the monthly pivot and the 50 and 100 DMA's.  We also have a previous swing high trend line serving as support.  Finally, there's a possible double bottom seen on a 240M chart.  We'd need a close above 153.0625 for pattern confirmation.

Gold

A possible bullish Fib Cluster Pullback trade is developing in Gold.  The Fib cluster zone is currently between 1264.20 and 1253.20.  It contains a combination of 3 Fib retracements or extensions from a dominant MM with neutral retracement and a supporting1 MM with supershallow retracement shown on a daily chart.  Further supporting this zone is a previous 4 point downward sloping resistance line that is now serving as support, a 6 point upward sloping trend line, and a previous swing high trend line.  Prices are still also above both the 50 and 100 DMA's.   A move above 1272.80  triggers a long entry with stops below 1253.20.  Target1 @ 1294.40, target2 @  1300.90, and target3 @ 1307.70. 

Nasdaq (last update)

The bearish MM Fade pattern is now void as prices moved above 5533.00 today.  

Nasdaq (update)

The following market recap is from my newsletter for the week ending 4/13: "This past week saw prices come off further after establishing a bearish engulfing pattern on 4/5.  The market closed below its 20 DMA on Tuesday and it has served as upside resistance the past 2 days.  We haven't closed below the 20 DMA for more than one day since December, so this is something to watch.  We did find support at the MS1 @ 5351.42.  That level along with the 50 DMA are the next downside obstacles to overcome."  This week has continued to see resistance @ the 10 and 20 DMA's and could be forming a head and shoulders top pattern.  The head of the pattern was formed with a bearish engulfing pattern that lead to a short entry @ 5408.75 with stops @ 5481.50.  The pattern itself is forming in the top of my MM Fade Zone, which is calling for a reversal.  If prices break through the pattern neckline tomorrow, then we would need a close below 5354.25 for confirmation.  Stops would be placed @ 5431.00.  Target 1 would be @ 5245.00 and target 2 would be @ 5208.50.  In addition, another short entry could be placed at my 361/461 Fib combo @ 5344.50 with stops @ 5481.50.  The downside target on this entry would tentatively be @ 5065.50.

Cocoa (last update)

The bullish Cocoa set-up from my original 2/2 post is now considered void and failed to reach its minimum upside target. CLICK HERE for the original post. I'm now focused on another potential bullish MM Fade pattern, but on a much smaller scale than the last one.

Here's the Pattern Analysis: Cocoa might be setting up for a smaller MM Fade pattern with the focus on the move down from the March 21st high of 2188 on the July contract. This recent downtrend has a dominant MM with deep retracement and 1:3 left-handed skewing. The supporting1 MM has neutral deep retracement with 4:2 right-handed skewing. Together they create my Fade Zone (2023 to 1815). Because both retracements are larger than 50%, I consider this a weak downtrend that should produce a nice upside move if a low is established within it. You can expect a bounce to a minimum of the 50% retracement level from that March 21st high and the potential low.

Soybeans

Pattern Analysis: Soybeans have been trading lower since its Jan 18th high of 1092.50 on the July contract.  This recent downtrend has a dominant MM with deep retracement and 7:8 left-handed skewing.  The 1st level supporting MM has medium deep retracement with 1:7 left-handed skewing.  Together they create my Fade Zone (962.375 to 864.625).  Because both retracements are larger than 50%,  I consider this a weak downtrend that should produce a nice upside move if a low is established within it.  In addition, both have left-handed skewing which signals a lack of downside momentum.  Finally, there's a 2nd level supporting MM with supershallow retracement and 4:3 right-handed skewing.  This last piece provides a Fib extension of its own from 974.875 to 941.375.  It's this last MM that could help narrow down my overall Fade Zone.  Overlapping the two gives me the 1st area (960.50 to 941.00) that I will focus on for a possible bullish trade. 

Pattern Update: Yesterday's low was 941.25, which was at the very bottom of the 1st area I was monitoring for a possible bullish trade, just above the low from 8/2/16, and right at my 261/361 Fib combo.  Prices ended up closing up towards its open creating a long lower shadow.  These bullish supporting signals.  In addition, we have a possible double bottom forming.  We need a close above 960.25 to confirm it.  Stops would be placed ~ 948.00.  Target 1 is @ 973.50 with target 2 @ 978.00.  Supporting the double bottom, we have bullish divergence on the RSI and a bullish crossover on the MACD.  In addition to trading the double bottom pattern, you could go long at the 261 Fib combo turn bar @ 960.50.  Stops would be placed below the recent low @ 941.00.  Minimum upside objective would be @ 1016.75.  Upside obstacles include the 10, 20, 50, and 100 DMA's; the monthly pivot; and a volume @ price resistance zone.

Cocoa (update)

Over the weekend, I posted "One area I will be looking closely at is between 1946 and 1918.  In it, there's a 261/361 Fib combo, a 78% retracement level, MS1 @ 1913, and the 361 Fib combo @ 1918.  If this zone doesn't hold, then I feel we will retest the recent lows.  So, for now I'd stay in the long position entered @ 1947.50 and look for another possible entry lower."  Today's low was 1934, which fell right in the middle of my potential support zone.  Buyers came in and pushed prices near the highs creating a piercing line candlestick, which could help trigger higher prices.  The recent sell off caused damage to the bullish case, but there's an opportunity for a low risk/high reward trade.  You could go long @ 1982, which is the 261 FIb combo.  Stops would be below the piercing line candle @ 1933 with a minimum target of 2080.  The target is right around a volume @ price resistance zone and just above the falling window.

Gold (update)

Gold triggered a MM Pullback buy entry today with a strong breakout.  It closed above a 4 point downward sloping trend line and was the highest close since November.  Its high was just shy of the monthly R1 pivot and looks to be headed toward my target range of 1293.30 to 1313.20.  Entry price was @ 1259.00 with conservative stop @ 1241.40 and aggressive stop @ 1248.10.

Gold (update)

We did find support today between 1250.60 and 1246.80 setting up a potential MM Pullback pattern.  First, this pattern relates to a MM breakout pattern seen on a daily chart.  This MM has a supershallow retracement, which is bullish, with 4:5 left-handed skewing.  Any pullback within the 38/78 retracement area is considered a potential buying opportunity.  My MM Pullback Zone is from 1250.6 to 1246.80.  Supporting this pattern is a 3 point upward sloping trend line and prices being above the 50 DMA, the 100 DMA, and the monthly pivot.  Entry will just above today's high @ 1259.00.  Conservative stop would be @ 1241.40 with aggressive stop @ 1248.10.  Target range would be 1293.30 to 1313.20.

 

Heating Oil (update)

This past week saw heating oil reach its MM Fade pattern minimum objective and its double bottom objectives.  Next up is the MM Pullback minimum target of 1.7122.  Prices are currently above all 4 moving averages, but found resistance at a 461 Fib extension from a small MM pattern.  There's also upside resistance from a volume @ price range between 1.6415 and 1.6720.  In this range, there's a monthly R1 pivot that could cause a pullback.  Over all, this pattern is still looking very good with lower support between 1.6000 and 1.5685.

Gold (update)

It was a pretty interesting week for Gold.  After confirming a flag pattern last week, we had the makings of a potential upside breakout of 2 MM patterns.  There was also a potential sym triangle pattern forming.  Friday saw the 2 MM patterns activated, but we failed to confirm the sym triangle pattern.  Prices broke higher to only fall back and close inside the triangle.  This pattern is now void.  The flag and MM patterns are still active, however.  Gold is now facing a 4 point downward sloping trend line.  That needs to be taken out to gain any upside potential.  To the downside, there's possible support between 1250.60 and 1246.80.  That could be an area for a very low risk, high reward entry.  If prices trade below 1241.50, then the flag pattern fails along with one of the MM patterns.

Nasdaq (update)

Another bearish trade could've been entered on Thursday below the engulfing pattern from Wednesday.  Entry @ 5408.75 with stops @ 5481.50.  Downside target still ~ 5150.00.  We ended the week remaining above all 4 moving averages with the 20 DMA serving as continued support.  That needs to be breached for the bearish case to take hold.

Cocoa (update)

Friday's price action did some chart damage to my bullish call.  Prices gapped lower creating a falling window pattern.  We are also back below all four moving averages and below the double bottom neckline.  However, we do have a bullish MM Fade pattern about to become active once 1983 is reached.  The dominant MM has deep retracement with 1:3 left-handed skewing.  The supporting1 MM has neutral deep retracement with 4:2 right-handed skewing.  Together they create a bullish Fade Zone between 1983 and 1854.  One area I will be looking closely at is between 1946 and 1918.  In it, there's a 261/361 Fib combo, a 78% retracement level, MS1 @ 1913, and the 361 Fib combo @ 1918.  If this zone doesn't hold, then I feel we will retest the recent lows.  So, for now I'd stay in the long position entered @ 1947.50 and look for another possible entry lower.

Gold (update)

Gold is forming a possible symmetrical triangle pattern.  If we get a close above 1263, then it will be confirmed.  This, combined with the active flag pattern, a possible supershallow MM pattern, and a possible neutral MM pattern makes for a very interesting market to watch.  A move above 1268.10 could really trigger a big move to the upside.  Next area of resistance would be the monthly R1 @ 1277.60

Nasdaq (update)

We made new highs today on selling and closed below the 10 DMA.  We also formed a bearish candle pattern engulfing the previous 4 days.  So, over the past 5 trading days, we've had this engulfing pattern along with 3 doji's.  I believe the market is signalling a tired market that needs a correction.  So, in addition to the short position I suggested the other day that has stops at 5535.25, I'd get short @ 5403.00.   I'd put stops above the high of 5481.50.  This is potentially a low risk, high reward trade because these candle patterns are inside my Fade Zone.  If a top is established inside it, then you can expect a large downside move.  My first estimated target is ~ 5166.00.  I'd like to see follow through selling tomorrow and close below the 20 DMA.  We haven't closed below it for more than one day since December.  It would set-up an immediate test of the 50 DMA ~ 5317.00.

Heating Oil (update)

Heating Oil has had a nice little run-up over the past few days since confirming the double bottom pattern.  Today it met my minimum double bottom target @ 1.5879.  Next up is the full double bottom target @ 1.6029, which sits right below a 50 DMA and a 361 Fib extension.  This area could provide some resistance and see prices come off a bit.

Gold (update)

Gold confirmed a flag pattern yesterday and saw early follow-through buying today.  But, prices found resistance near a 261 Fib extension from a MM breakout pattern on the 240M chart that coincided with a downward sloping trend line.   The next key price levels remain 1264.20 and 1268.10.  If we can close above them it should trigger a nice upside breakout.  First, it would void the 3 point trend line serving as resistance.  Second, it would trigger a supershallow MM breakout pattern.  Finally, it would trigger a neutral MM breakout pattern.  Gold is definitely worth watching this week.

Nasdaq (update)

Prices traded below yesterday's doji triggering a short trade.  But, it found support at the monthly pivot and closed back near its opening price.  We now have 3 consecutive doji's, which could be signalling a tired market.  It's worth taking a small bearish position with stops above 5533.50.  That's where my MM Fade pattern fails.

Gold

Gold is setting up for a possible flag pattern with a move above 1252.80.  Stops would be placed below 1241.50 with the pattern objective ~ 1307.70.  If we get a move above 1264.20, then it would create a MM breakout pattern that has supershallow retracement.  And if we get a move above 1268.10, we'd get another MM breakout pattern that has neutral retracement.  Both MM patterns would be bullish and together create a catalyst to reach the upside pattern targets of 1307.70 to 1336.30.  Prices are currently above the 10, 20, 50, and 100 DMA's so the chart is set up nicely.  Let's see how next week plays out as we would want an immediate upside breakout.

Heating Oil (update)

Friday saw more bullish action with a 4th consecutive day with closing prices above the previous day's high.  We are over half way to the double bottom objective, which coincides with a 361 Fib extension from a small MM pattern.  There's also a 50 DMA in that area, so look for possible resistance ~ 1.6006.

Copper (update)

The Fib Pullback trade was voided on Thursday as prices traded above 270.00  The head & shoulders top pattern is still intact.

Nasdaq (update)

We formed back to back doji's near last week's highs.  If you didn't exit the short position at the scratch price, then I'd hold on with the original stops @ 5533.25.  If you did exit, then I'd consider re-entering below today's doji low of 5421.00.  This would be another sell trigger as prices are still trading within my MM Fade Zone.  If prices move above 5533.00, then this pattern is void.  Doji's can either be the market taking a breather OR signs of a reversal.  The placement of these doji's, in my sell zone and near recent highs, makes it more concerning to long positions.  I'd be cautious of holding any  if we break lower.  It could be the making of a double top pattern.  Let's see how next week shakes out.

Cocoa (update)

Thursday, the objective of the symmetrical triangle was met @ 2066.  Friday was pretty quiet action with prices holding above MR1.  If we can hold above 2028 and make new highs above 2187, then we will have a MM breakout pattern with neutral retracement.  That would be bullish and help prices continue higher.  The long position is still in great shape.

CRB Index Long Term Forecast

The CRB Index is an index of 19 commodity futures and weighted most heavily in Energy and Agriculture.  Looking over the weekly chart, I see a potentially large upside move developing.  The CRB index sold off aggressively from June 2014 to the recent lows in January 2016 without any significant rallies.  It put in a double bottom during that time, which help kickstart higher prices.  Over the course of the next 12 months it managed to form a measured move (MM) breakout.  This MM had a shallow retracement, which is bullish, but had 8:24 left-handed skewing.   The leg up off the August 1st low had 2 MM patterns with deep retracements.  The left-handed skewing of the main MM pattern along with the 2 MM patterns with deep retracements created weak upward momentum and helps explain why prices were not able to push much higher.  So a pullback was to be expected.  In these situations, a pullback support zone can present itself between the 38/78 retracement levels indicated on the chart below.  Prices traded into this zone (182.7734 to 180.5094) and found some support.  Helping the case was the dominant MM pattern on the Jan 2017 leg down.  It had a medium deep retracement, which is weak, and created a 361 Fib extension into the pullback zone @ 181.6392.  The low was 181.5533.  Since trading higher, on March 21st there was a bullish MACD crossover on the daily chart.  My long term forecast is for prices to reach 217.7016 BEFORE falling below 176.6698, which is the pattern failure level.  A move up to the 217.7016 area is a big move and I would expect it to take 6 to 12 months.  Long term patterns in many of the index components also predict higher prices.  This will be something to keep an eye on for the next few months to see if the 176.6698 level can indeed hold.

Heating Oil

Heating Oil confirmed a double bottom pattern yesterday on the May contract with a close above 1.5428.  Entry price is @ 1.5429 with stops ~ 1.5085.  Conservative target is @ 1.5875 (75% of pattern obj) and aggressive target @ 1.6024 (100% of pattern obj).  Supporting this double bottom, there is bullish divergence on the RSI and a bullish crossover on the MACD.  We also were able to close above the 10 and 20 DMA's.  The next upside resistance is @ 1.5579 (MS2) and @ 1.5680 (Fib 261).  Underlying support should be found at the volume @ price area between 1.5149 and 1.5075.

This pattern, by itself, shapes up nicely.  But, what makes it even more interesting is the bigger pattern that could be developing with it.  This double bottom pattern formed right in a MM Pullback Zone between 1.5187 and 1.5007.  This pullback area relates back to a dominant MM pattern shown on the weekly chart with a neutral retracement.  Anything less than 50% indicates a healthy uptrend.  The projected MM target is 1.8875.  So, we have an opportunity for a low risk, high reward set-up going with the recent uptrend shown on the weekly chart.  In addition to trading the double bottom pattern, you could also go long @ 1.5429 with stops @ 1.4824.  Conservative target would be @ 1.7122 with an aggressive target @ 1.777.  Both have reward:risk ratios above 2.50.  Finally, a much larger long term trade could be made with entry @ 1.5429.  Stops would be placed @ 1.3616 with the target @ 1.8875 for a nice 2.90 reward:risk ratio.  Although this last trade is probably too large for the average trader, it's worth keeping an eye on longer term.

Copper (update)

Copper came within 0.80 of my minimum downside target yesterday before roaring back.  It closed near its highs creating a tall lower shadow.    This was the first warning sign that my bearish trade could be in trouble.  At that point, stops could have been moved down to break even.  Today, we saw prices close above a 5 point downward sloping trend line and right back inside the Fib Fade Zone.  A move above 2.70 voids this pattern and I'd probably exit now it not done at break even.

Facebook (update)

Facebook has come roaring back since its huge engulfing pattern.  It is just shy of that 3/21 high and I would exit any bearish positions to wait for another sell signal to materialize.

Nasdaq (update)

The Nasd 100 has almost recouped it's entire downside move from 3/21.  The short position below the doji @ 5402.00 is now taking heat with aggressive stops @ 5535.50.  We are now back above all four moving averages.  At this point it's probably best to take a small loss and wait for another sell signal to materialize.

Cocoa (update)

Cocoa broke out of a symmetrical triangle pattern to the downside today.  It's not surprising considering we had 3 small body candles 3 of the 4 previous days.  The market ran out of steam just below my 2197 to 2237 resistance zone shown below.  The downside target on the triangle pattern is ~ 2065.  That would still be above a 50% retracement from the recent low, so the uptrend is still intact.  There's a volume @ price support zone between 1995 and 2025.  I would like this level to hold, otherwise the recent rally could be in jeopardy. 

Copper (update)

Copper saw follow-through selling today after reaching my resistance zone yesterday.  We are now trading below the 10, 20, and 50 DMA along with the monthly S1.  Next downside obstacle is the 100 DMA ~ 2.5717.  My 1st target is the recent low @ 2.5585.

Facebook (update)

We had a bearish engulfing candle form today at its monthly R2 pivot.  This pattern engulfed the previous 7 days and creates major upside resistance.  This could become a benchmark candle to the downside.  I've been looking for a top in Facebook for the past couple weeks as its been trading inside my Fib resistance zone.  We had a false engulfing pattern the other day, but this one seems solid.  It also coincides with a potential top I'm seeing in the Nasdaq 100 (see posting on this blog).  I see downside targets of 131.50 to 127.50.

Orange Juice (update)

Today we traded through my target window of 187.50 to 191.70 with a huge 3.8% rally.  That measured move pattern with shallow retracement and 4:1 right-handed skewing was definitely the trigger.  The next upside target is the 361 Fib level @ 200.24.

Nasdaq (update)

We made new highs today on strong selling, best shown by the large red body candle.  We also closed below the low of the doji pattern from a couple days ago thus creating a low close doji pattern.  If you went short below the doji with my aggressive stop @ 5440.25, then you'd be stopped out.  If you went short with my conservative stop @ 5535.50, then you'd still be short.  If today's high holds up as a top, then I see aggressive downside targets ~ 5045.50 and conservative targets ~ 5183.50,  But, I will revisit as the market develops.

Cocoa (update)

Cocoa had a strong gap up open above the falling window.  Prices later closed that lower gap and finished the day right near the open creating a doji candle.  This shows buyer and seller equilibrium. I'm not surprised as we are just under my 2 double bottom targets (blue box on chart below) and its 100 DMA.  We haven't closed above it since last August, so this is our next big hurdle to overtake.  We also have a 361/261 Fib combo along with the monthly R2 between 2197 and 2237.  So, I expect this area could provide some short term resistance.

Cocoa (update)

Today prices closed above 2060 confirming a double bottom pattern.  We also closed above the 50 DMA for the first time since August 26th.  Next upside obstacles are a 261 Fib @ 2124, a falling window @ 2134, a Fib cluster @ 2197 to 2218, the 100 DMA @ 2210, and a monthly R2 @ 2237.

Nasdaq (update)

Entry on the doji pattern was triggered today as prices traded below 5402.25.  However, prices found support near its 10 DMA and closed higher.  The aggressive stop is @ 5440.25 and the conservative stop is @ 5536.00.  We haven't closed below the 10 DMA since December 30th, so that's the 1st downside obstacle we must overcome.

Copper

First off, the May Copper contract has a confirmed head & shoulders top pattern. It broke and closed below the neckline on March 6th. The overall downside target is ~ 2.4730 and my conservative target is ~ 2.5215. Original stops would probably be best above the right shoulder's high of 2.7685. That being said, this market has been rallying since the March 9th low to test the upward sloping neckline. This brings me to my current analysis, which sees Copper running into my Fib cluster resistance zone between 2.6745 and 2.6972. This resistance zone is supported by both the upward sloping h&s neckline and a downward sloping trend line. Today's price action saw higher prices made on selling, as we see a good sized red candlestick, and we closed below the 10 and 20 DMA's. If we can get a close below the 50 DMA soon, then I think Copper will at the very least test the recent lows. That would be the minimum target. Some more aggressive targets would be the 1st h&s top objective @ 2.5215, the monthly S2 pivot @ 2.5152, and the 2nd h&s top objective @ 2.4730. Downside obstacles are currently the 50 DMA ~ 2.6487, the monthly S1 pivot @ 2.6143, the 100 DMA ~ 2.5702, a Fib cluster support zone between 2.5468 and 2.5370, and the monthly S2 pivot @ 2.5152.  If prices move back above 2.70, then this Fib cluster retracement pattern is voided.

Facebook (update)

A bearish engulfing pattern formed on Friday @ my 261/361 Fib combo level.  If long, I'd consider taking some profits with a move below 139.70.  I'd also consider make a bearish play with options as there's solid upside resistance up to 144.00.  Downside target would be 131.50 to 133.50.

Nasdaq (update)

Friday produced an inside bar, so the doji candle was neither triggered nor violated.  We have solid upside resistance all the way up to 5535.50.  I would initiate a small bearish position with a move below 5402.25, which would trigger the doji pattern.  If futures, then aggressive stops could be placed above the doji high of 5440.00.  Conservative stops could be placed above my upper resistance zone @ 5535.75.  Some bearish options plays could make sense as well.  If the doji high holds, then I see a potential downside move to the 5105 to 5000 range.  If the doji pattern doesn't get triggered and we move higher, then I will wait and look for another sell signal.

Nasdaq (update)

We formed a doji candlestick today.  It could just be the market taking a breather, but it's placement on the chart has me thinking possible top.  First, it's taking place in my resistance zone @ the 361/461 Fib combo.  Second, the RSI shows bullish divergence.  Third, the doji formed @ the monthly R1 pivot.  And finally, we already have a bearish MACD crossover.  I would definitely start thinking of putting on some small bearish positions.  At the very least, if long, I would be thinking of taking profits up here.

Orange Juice

Orange Juice (JOK7) is poised for a nice upside move.  It confirmed a double bottom on March 7th with a close above 174.90.  My minimum target is @ 187.50 with the overall target @ 191.70.  We had bullish divergence on the RSI to support this pattern.  In addition, there was a measured move (MM) breakout that had a shallow retracement with 4:1 right-handed skewing.  This is very bullish and gives upside targets of 190.55 (conservative) to 209.04 (aggressive).  My analysis calls for a move up to at least the 187.50 to 191.70 area (blue box on chart below).