The Art of the Comeback

The charts below are a Canadian dollar vs. USD and the US dollar index

I wanted to dedicate this post to point out how the market can totally be the boss and highlight that some reliable support points or resistance points can be invalidated with the events that go on and even though for the days leading up to August 14 I was correct I had to give back some profits and I am a more cautious bull and recent events have prompted me to possibly change my strategy. 

From my earlier post there were some charts of this Canadian dollar trade that showed an advantage in scaling in where risk is managed by having a very light position and then adding to it gradually and if a shock type of move would occur it would not destroy the trade too much. 

I was able to enter below 1.26421 on average and the higher lows began to show up little by little and the zone of gains was where I did not continue to add to the position it then went above 1.27648 before coming down quickly

the violent move down was 326 pips [relative top to relative bottom].  The rate of this rebound is much faster and more uniform in terms of seeing consecutive bullish candles the breakouts are occurring with more enthusiasm

I'm willing to go along with an idea of this pair below 1.25 or even less.  That would mean that I can get some protection, but that is a worst-case scenario so now the next level of focus is seeing where the resistance points manifest in the chart above current price of course there is a very powerful resist point at the top of where it says zone of gains partial entries. 

The series of lower lows were a little more controlled, that is what the LL means, so the bullish case for this pair  will be tested and there is a lot riding on monetary policy from the Federal Reserve and all the economic data coming out in the next few days and weeks

The chart here broke down to newer lows, which I asked the question as far as is this a mini-climax in selling strength.  

Continuation of Trend

This is trading that happened during the Globex session. When you click on the image below its a daily chart of the S&P500 futres [The Stock Market] called the ES it is trading at 2430.  A news item generated a gap in price and when this usually happens buyers could step in and price would tend to shoot up to 2436 as soon as the market opens or sometime in the early parts of tomorrow's trading session.  On this daily chart you can find the overhead resistance zones which are between 2436 and 2445 that is the congestion that is directly overhead and the other two red rectangles are the areas where price departed quickly and went down an approximate 1.8% from each overhead resistance area.  Those levels should hold but anything can happen.  Below are the price levels where there is a lot of sensitivity where buyers will compete for good deals like 2401 and 2409.  There is a strong chance that with the news about missiles flying from North Korea that the market can go as low as 2385 tomorrow.  The other locations of price shaded in the yellow rectangles are stronger support points which are likely going to happen over the week, but it depends on how fast sentiment changes.  

Potential Bearish Set Up

GBP; British Pound Bearish Set Up

1. Completion of Inverse Head and Shoulders Bottom
2. Exhaustive bullish candle followed by consolidation, next set is break down
3. Prior origin of sell off put in place on 8/21/17
4. Temporary Dollar Weakness

Resetting the Wave Count

I would hope to make the location of this resist point as elegant looking as possible.  1.19 is big challenge for the EUR/USD and so far the Fed is still communicating their policy going forward.

Forex In Focus Dollar or Anti-Dollar

Dollar Index

for a moment I thought the strength of the recent decline was substantial enough to signal a change in trend.  That means most of the progress gained at S1 11,881 would be wiped out by the sellers pounding the index.  Because the market can change on a dime I had to be willing and able to call a change in direction but in recent days there was a consolidation (Shaded yellow oval) that would mean the rally could base and rally again.  This rally then base than rally, is more of a pattern that we are looking for in a bullish sequence.  So the dollar index printed four distinct higher lows which are highlighted with the green arrows.  The bullish engulfing candle was for August 22, 2017.  That also begs the question if the index can make it to 12,038 or the R1 and R2 locations above which would confirm the extra strength for the dollar being that it has had some trouble climbing to 12,000.  There is more news about monetary policy coming out so that can be a driving factor.  As always I prefer to have two supportive zones and two resistance zones on a chart to clarify and make a strategy more tangible no matter what happens.  The moving average above also suggests that price can drift toward that price also

Goal Revisited

I did not trade this way but only partially.  A lot of times trading you will find that sometimes your targets not only are met but they are exceeded.  This excess text box at 111 is where I felt price can begin you to tighten and head down.  I was not heavily involved in this pair but this is a 30 minute chart and the area labeled boost was where I previously wrote about it preparing for a rally so now that it is down in this 109 territory it can still bounce a little bit but as strong yen would bring it lower like 108.507 and 108.19 judging by the strength of these recent to candles it would seem like 109.50 is likely because it is coming off and origin of a powerful rally

The EUR/USD has been waiting on direction from monetary policy authorities like the Federal Reserve and ECB and for that reason I believe it is chopping around even though the daily chart does not show a tight range it still has been acting ambivalent but it has been hitting temporary highs that are shaded in red the strongest demand we have seen is in the green rectangle and some of the buying points at S2

Loonie acting Looney

Is this just an interim correction? when I first pointed out how powerful of the resist 1.27687 was I did not think I was in for such a surprise because the height from that price to now came out to a 252 pip drop.  So the strategy now is to find support points and test their relevance.  There is a lot of consolidation going on and the height of the blue candles are clustering and it can signal some potential upside.  A possible observation is that lower highs are forming and could lead to plenty of overhead resistance but the two blue horizontal lines shown at 1.25277 and 1.25405 only show that price is reacting to this buyer support with some sensitivity.  If support zones do not get respected it would continue the trend of lower lows and lower highs

Putting One Candle In Context

This will be an expanded study of how a reveral candlestick will work in a bullish trend 

Tesla and Profitability

NFLX - Big Picture

Weeklies for the EUR/USD

Options, Stocks and Forex

Vix as an Options Indication

This Year in Review - The first candlestick which was printed on Jan 3rd 2017 to now has several cycles of note.  The first is the consolidation between 10.5 and 14.5, which made up a majority of the early winter to late spring.  The cycles I point out "7 day cycle low and 5 day cycle low" are highlighted to point out how the price tightens so much that when it springs it reaches a new high for that cycle.

The cycle on 3/29 for that candle the range itself was a mere 0.67 with a low of 11.3 it then went to 16.22 on April 13th, 7 trading sessions later.  Hitting the barrier I shaded in purple was a real hurdle up until August 10th.

The same type of action happened when the Vix hit its low 9.56 for a very tight 0.56 range on May 9th, then it shot up to its cycle high of 16.3.

Everyday up until 8/8/2017 the CBOE Vix Index averaged [Red Moving Average sliding across the screen] on some level below $11.31 its mostly a bearish indication.  This 100-period simple moving average acted as resistance or tended to indicate that it won't be able to trade higher than it for most days of this year.

But! recent break outs and its follow have added some enthusiasm where lows are being bought and highs are holding strength.  For example, the most recent white pointing up arrow on 8/16 points out price held above the moving average where it begins to act as support.  

New Trading Range minor peaks at 20 or 23?

From October of 2016 to now the 16 range technically acted as a barrier that was only over taken in the middle of October and the week leading into the election where it topped out on 11/4 at 22.96.  

When you take a closer look, the cycle has a lot more enthusiasm to it.  That is, panic can overtake the collective sentiment very quickly and the trend dominators are more apparent

The Stock Market

How the market behaves in between each of the three bands is what is in scope.  The green line [mean] in focus now.  Because it is at 2463.23 I would like to observe that it is currently switching direction, whereas most of the year it was sloping higher and pointing up, it is now starting to turn the corner and price is dragging it down.  So, for this chart, the time when price punctured the lower band, demand was so intense that it either did not fully close below the lower band OR it stayed there just momentarily before resumption.  Normally when price cuts through the higher band or lower band, it signals further action and confirmation of the said move.  In this case it acts as a trap for any of the bears hoping to drive price lower.  Here, it traded as if there were three bear traps, price was only reacting to the institutional demand and order flow at those prices.  

The question is how many more days could it continue trading below the lower purple band before it snaps back, the market as a collective will give an answer, my hunch is that it can last for longer than a week, because that is the surprise that would upset everyone wishing that there would not be a negative headline; also we are approaching the worst time in terms of seasonality to be bullish on the market.  

The Dollar

The lower shadow on each of these daily time frame candlesticks have the signature of slightly stronger demand.  The green shaded rectangle is very critical for any currency speculator attempting to drive the dollar into a weaker state, which since earlier in this month has held nicely with 4 [noted with green arrows on the chart] lower highs.  On some of my earlier posts you can tell that I was looking for a powerful resist point at 12,000 and thats just what we got.  I don't format my trendline [brown] to extend out to infinity but in this case I felt it was OK because it shows how this projected trendline would intersect with the 12,070 and 12,103 zones and it is also paired closely with the 50 period moving average and the descending black dotted trendline 

Summing up these factors

• The previous sellers were hitting it hard at 12,070 and 12,103
• The simple Moving Average is trending at 12, 050 est.
• Trendline intersects with this area at 12,050

The dollar index may be able to absorb any information pending from Central Bank Meetings in the next days and weeks, and I am sure any communications re: Fed Policy will dictate any further demand or lack of demand for US Dollars.  

The Three Scenes

The Long View - Monthly Candlesticks

The month of August has turned red, and if we had to compare the way that the markets trade on a monthly basis and apply it to daily trading we can see that the price right here is beginning to cut through the meat of the real body (green month for July) where it is more than 50% through the candlestick that was printed for last month.  If the past is any indication of what is to come there is a probability that we will finish off the month cutting through three or four candles length/height.  I know that may seem extreme but the candle sizes are getting bigger as the Bears begin to pick up in intensity, the can often average very tall candles.  1803 is a critical support point on this time frame.  In two points of view it can be gathered that price has the potential of drifting down to 2028 because that was the printed low took place on November last year.  [Election Bottoming Formation] in all reality reaching a nearly 17% drop is not without precedent but given the risk associated with the macroenvironment it is becoming more possible.  Reactions are coming from political headlines  On the other hand a 6-7% upwsing would bring the S&P 500 to 2600. 

The 50 period moving average comes to 2051 and that is near the election bottom as well. The institutional or aggressive buyers are placed at around the yellow arrows which you can also see on the weekly chart.  

The Medium Term - Weekly Candlesticks

225 and 50 Period Moving Average

These candlesticks give a lot more definition and the 225 moving average shaded in blue is lot closer.  The 50 period moving average is a lot more useful as a reference here.  The target set here is more of a maximum exhaustion point for the sellers, and probably a worst case scenario.  (Support 1) A mean reversion back to 2309.  (Support 2 ) a return back to the November bottoming formation and that is as far as the trendline extends.   

The Next 10 Trading Sessions

The institutions that are unloading their shares are definitely not buying as buyers dictate the market.  They are leaving their footprints with volume spikes.  Cash raising is what happens gradually and on each of the blue vertical lines I have indicated the days when volume goes up with a decline in price and that is confirmatory. For instance today's volume spike happened with 2.22167 million contracts traded "Large Players" are at work in spite of the gap in volume that happened up until August 8th This led to a gradual decline in stocks but not all at once.  It would have been more obvious if institutions sold all at the same time.  The white box shaded from this week was crushed with this massive downside breakout. And the frequency of directionally down closes in price are happening as well as ranges beginning to widening out.  In these past two Thursdays [8/10 and 8/17] the ranges were 41.5 and 44.75!  Compare that to the average daily range from Aug 15 and 16 at 12.875 per day.  "The Market takes the staircase up and elevator down" well the velocity of each decline expressed here is beginning to be more than 2x greater that each respective ascent.

Prepared for Anything

The Power of the News and Being a Learning Machine

When news is released like FOMC minutes or another related Central Bank announcement I normally look for a move in one direction and then a possible reversal.  Or I look for a move in this primary direction and a continuation.  The information disseminated today led to a bearish reaction in the dollar.  Below is a 15 minute chart with a label below a yellow arrow to indicate when the news was released at 2PM eastern time, and then the follow through.  There is the first push down, the consolidation and then the rush lower.  It seems that as I type this post, the dollar is attempting a rebound.  From the time the news broke until 9:40PM eastern the total distance traveled was 41 points.

This event resets a lot of my thinking regarding the direction of the dollar against many pairs:  AUD, CAD, and perhaps not the Yen.

Losing Intelligently

The maintentace side of trading involves keeping an optimistic and pessimistic set of targets for whatever happens.  For instance I could have viewed this move in AUD/USD as something positive but instead I wanted to stick to my guns and just shoot for a closer profit target.  Yet I had to learn the lesson again on how far things can run when RESISTANCE POINTS don't get respected.  "Change your specs" I I only did the opposite of what I thought

Tight and Dry S&P500

This time of the year is notorious for this type of tight range with dry volume.  This is an update to a prior chart where we are focusing in on volume conditions.  That is to indicate where volume spikes on bearish surprise days.  In this daily char you can see where volume spiked on the past 5 sell-offs, and how all the green candles occurred on significantly lower volume.

The triangle formation happened with a quick break out [8/8], which was followed up with a cascade last Thursday [8/10].  Each day after Thursday 8/10 was met with gradually less volume, the candlesticks traded in a total range of 12 to 13 points the whole day compared to Thursdays move of 41.5 points.  It is typical for August, but that doesn't mean we are not in store from a surprise geopolitical event shock.  

Accumulating Small Objectives Turn into Attaining the Big One

There is a yellow line located at the resist point at 1.18372 that was where I averaged some portions of the short sale and I covered above 1.17.  It is a milestone in measuring out the magnitude of this drop in EUR/USD. Before I mentioned three important support levels and when they become violated the demand for euros goes up, and today's price action overtook the lows  on  August 9th and 10th.  

There are many things that can happen tomorrow the dollar index FOMC minutes coming out.  

Here I wanted to display the daily view and show how the length of the candlestick bodies are getting longer (red ones) and the lows are getting progressively lower and the highs are becoming shortselling opportunities.  One thing I wanted to do for the majority of this change in trend was hold onto positions for longer than I think and for this type of position I have my stop above the text note that says sold short.  Then as time goes on I will add to the position with equal amounts of size.  What I learned about downtrends is that support points are often not respected and I can learn how to hang on to this for the whole day instead of just half of the day.  This is a trade going with the carry trade and  not against it.  "Paid to Wait" For now the S2 and S3 levels I placed on previous charts are still valid because they are such an intense amount of distance away from current price at 1.17400

Remember from some of the earlier charts that I cited 12,018 to be a stiff resist point, it seems that we are on track to hit it but sailing through selling points should not be too much of a problem with all the momentum in the dollar currently.  This chart definitely shows how much of the Euro is factored into the dollar index.  The exaggerated tanks in the EUR side of the equation are making this Dollar index climb quickly.  As far as FOMC, we'll see what happens with a before and after image of how the news impacts price tomorrow.  

Exceeding Expectations

EUR/USD and USD/JPY in Focus Today

The time intervals that I am using in all three of these charts for the EUR/USD are the daily time frame, the eight hour time frame,  and a three-hour time interval

The daily chart of the euro against the dollar shows supportive trendline that had several points of touch and it appears that prices are starting to deliberate before a possible downside break.  What I wanted to point out were the two horizontal arrows showing bearish candlestick activity [8/4 and 8/14; where 1.170 holds critical supportive structure]  it seems that there is a greater frequency of negative closes in this snapshot of time - the rate of red closes is becoming more frequent.  I would further point out that the green zone indicates the last hope for the euro bulls if they cannot hold price above those supportive wicks, it would  signal further strength for the dollar. There is an important meeting coming up in Jackson hole where the European Central Bank governor Draghi will be speaking but that is not for another two weeks and the time in between is important because it allows for the market to digest whatever information will be coming down the pike from the Federal Reserve this week and any other political events that would signal risk on or risk off. 

Whenever I point out lower highs or lower lows or higher lows or higher highs I want to be as deliberate as possible in showing where they manifest on the price chart so this image is a conceivable target where the buyers are standing ready to attempt to push price higher in the green shaded zone below.  In the 3 hour chart you will see a lot more of the tactical maneuvers for trade entry and trade exit.  Because this pair gives me so much more leverage I prefer to trade it on a higher timeframe where more opportunities present I can weave in and out of it without having overnight risk.  

In the 3 hour chart there is a tremendous amount of distance between price and those three levels for S-1 the distance is  a target of 98 pips for S2 the distance is a target of 130 pips and the goal for this critical juncture target is 182 pips.  If I can reframe my mentality I would have done that the entire way higher as the dollar got weaker.  I thought it would be helpful to visualize the changes that happen when price coils in the yellow shaded rectangles when price was trending higher.  Also there were two cases where price coils in the red shaded rectangles and then broke out harshly to the downside.  To me it feels like it takes longer for trends change and they will offer us a lot more confirmation if the dollar is coming into a more commanding bullish phase.  Watch for commodities too!

30 minute Chart of USD/JPY To keep my risk tight I decided not to fully engage this long trade in USD/JPY even though all the stars were aligning and it was a great set up for me I just had Pro dollar and anti-dollar trades on already  so it was great that my analysis proved to be correct and I think there is a chance for even better moves to come.  The price blasted through the levels I set as potential objectives and on the daily chart it is even more clear

Daily Chart of USD/JPY: What I wanted to accomplish with the shaded  ovals were times when bullish candles were overtaken by bearish candles and in each of the yellow ellipsis they were followed by downward thrusts.  The past two days are a little bit different but I also expect that Yen to be somewhat undecided as political tensions have eased.  It would have made a terrific shortselling opportunity but below 108.75 is a huge pocket of air that would coincide with some type of panic event in the equity markets.  If more support gets violated this in my opinion we will have so much more growth potential and ability to scale in positions with Yen related pairs.  

The Waves of Bollinger Bands

I have found Bollinger bands to give signals that have clarity.  When price closes above or below a band it often signals further direction or confirmation of the dominant move. 

In this chart we are studying the price action of Apple shares where the date goes back to June 5 of this year where price was trading at the red part of the Bollinger band which we will call the resistance band and it traded down to the purple band which we will call the supportive band.  The green sloping line in the middle is the mean.  The Bulls will look for further action in a positive direction when price breaks above the upper band.  Likewise bears look for continuation of a move when it breaks and closes below the lower purple band. 

 In this case there is a severe drop in early June where the long red candle printed on June 9 it close below the purple supportive band and five trading sessions after, it cut through and closed below the purple supportive band at point A.  For many of the bears interested in shorting they were caught in the middle of the excitement and when price moved higher the next day the signal was invalidated (the underlying trend was still up).  On July 11 the mean price point to be coincided with a preceding rising trend on this daily chart where three candles were in succession [Three Marching Soldiers].  That is three green candles in a row which led to a series of price rises where it did close above the resistance band. 

 The note called "extreme resist point" on July 27, where it did not trade that much higher and it exhibited a classic scenario of when price moves from near the resistance and all th way down to the mean in the same day

At the horizontal blue arrow where it says mean reversion price had the chance to coil and set up for earnings where it jumped into the 158 territory and then began closing above the upper band for all of the days in the series "Close Above Upper Band" The yellow arrow is placed on August 7th, and the obvious tall red candle printed on the 10th signals bearishness, and sets up a Harami formation.

 Included you will find a case for a bearish Harami.  They tend to be like mirror opposites of each other on bullish and bearish sides of the price action.  Of course where I made another note called next mean reversion at 153 that goal can happen in a day but bring your attention back to June 9 where price drifted toward the supportive band and went back to point A.  that is possible within a week because of a shift in how traders are reacting to the news and typical August to October seasonality.

Moving Averages

Technical Analysis Tools

I'm going to be reviewing some ideas that cover different topics in this post.

This very good trader named Krausz brought three time frames to one display screen and called his system the Laws of Multiple Time Frames, these are the rules

1. Every time frame has its own structure
2. The higher the time frames overrule the lower time frames
3. Prices in the lower time frame structure tend to respect the energy points of the higher time frame structure
4. The energy points of support/resistance created by the higher time frame's vibration (prices) can be validated by the action of the lower time periods
5. The trend created by the next time period enables us to determine the tradeable trend
6. What appears to be chaos in one time period can be order in another time period

• The goal of this exercise is to point out an effective way of angling a trendline where it is not too tight and not too lose, so in the first frame see the bottom that occurred in February 2016 and how price does not track it very well. [79 Weeks of rising prices and 48.75% growth] the problem I find in this chart is that the trendline angle from February to April almost acts as but it does guide the velocity in my opinion
  

  
  
  
  
  
   But in the second frame that the that happened after Brexit on 6/27/2016 the angle and momentum embody most of the trend so for technical analysis it is helpful to point out that the trendline should capture many points of touch, where the candlesticks are within close range of the trendline.  These 59 weeks of traded ended in a violation of the trendline in the last two weeks.  This angle of trendline captures most of the trend and has many more points of touch.
  

  
  
  
  
  The third frame more accurately captures just the rise in 2017 that began after the election in late October Early November 2016.   Note that all three time frames and trendline angles begin at the origin of a very strong bullish move with a reversal pattern in this one there was a tall bodied hammer and in the second one there was a bullish engulfing candle in the third one there was a breakout from inside day/ bullish harami
  

  
  • Candlestick Formations and Patterns - I derive my terminology from Steve Nisson for what our traditional practices for Japanese candlestick charting
  
  
  The uptrend from May 23rd to June 8th was completely invalidated by the long red candlestick that was followed by another negative close.  These 12 days of progress were destroyed in one day.  And the key trigger to understanding how this happens is by the candlestick formation the engulfing nature of the price movement.  On the eighth trading session the buyers pulled out.    The point is that one negative trading session can "wipe out" 7-9 as seen in these two cases.  
  
  
  In second white shaded oval the Bears defeated the Bulls and that was on July 27 and on August 10.  The zone accounted for nine days of trading and the first long red candlestick encompass the entire range and 10 trading sessions.  Later on, nearly half the July advance was eliminated in Thursday's trading.  Though all three candlesticks formations were engulfing patterns, the last one on August 10th had some signature of "dark cloud cover".  
  

  
  
  
  Fibonacci
  Its has a similar appearance to the trendline angles I shared before,  this image shows where the 50% retracement is located at the 4930 level which is very close to a bullish breakout.  It is the origin of powerful rally that happened after December 26th of 2016
  

  
  
  
  
  
  Determining Trends from Moving Averages -  2 day time intervals over 5 years.  Lets zoom in on the sell off in early 2016 to now...
  The left end  of the chart is where the massive selling occurred in the early part of 2016 is followed by a doji formation, and then the rally paused at Brexit, and followed through at the yellow arrow which is considered to be called a golden cross.  These moving averages are simple moving averages: green one is the 50 period The blue one is the 225 period.
  

  
  
  
  
  
  In this frame you can see how price respected the 50 period moving average very well and created a bullish reversal pattern and stop at the all time  highs of 5995.75
  
  
  

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The Weekender

EUR/USD

From my last writing about the euro and following its downward moves I did account for a possible reversal where the dollar would get weak, and I was stopped out.  Finding the perfect resist point is not possible but on this chart I made a note for a juncture and on this date it did reverse here at t1.18372, it traded down to S1.  One major flaw in my strategy was not covering near the green arrows where I could have exited by 3/4 or 1/2.  The charts set up for this pair are made for intraday trading if not intraweek.

The resistance zones are still valid and personally I interpret the chart as slightly down but indecisive so I feel that is not good to make these directional judgments when it is stuck between highs and lows.  Extremes are best! 

USD/JPY

There was no reason for me to exit this trade early but I did.  The display on this chart shows a profit of 23.2 pips and it is based on an entry below 109; my stop placement was valid and there is plenty of breathing room where it would not choke off any potential movement in my favor.  There is still time for bullish momentum but I will be more convinced it cleared 109.25.  This one is of a 30 minute time interval 

AUD/JPY

The red box is the profit that I gave up this week and my average entry is highlighted in the horizontal green line where it says average entry and that is based on the buying activity between 82 and 83.  I had some times where I was shorting AUD and also being long of the JPY for protection.  But it was not often enough as the moves were swifter than my thinking and I was caught with a delay in execution.  It is hard to trade during time frames when I'm supposed to be sleeping or exercising.  So I am only in danger if the chart on a different time frame were more troubling like the weekly candlestick or monthly candlestick and there was a full scale financial crisis and the pair were to drop in the fastest way possible, but I also don't pretend to know what the future holds.  There is still plenty of demand and even though this is a daily chart it has a hammer candlestick formation put in for Friday and that is a standalone bullish indicator.  Also the support zone in  the light green rectangle indicates that there were plenty of buyers on that level and the Bears might take a break but the psychology is overall negative.  Next week I will make a theme about hedging with NZD/JPY and a possible return of more Yen strength (which would injure this pair tremendously)

USD/CAD - in defense of 1.26545

This chart is not showing my entries but I decided to point out all of the lower highs where there was plenty of absorption.  The green arrows pointing up show the daily lows and the sequence of buying activity and order flow.  When I asked the question about absorption this week it was a really good buy opportunity but I did not want to keep my average entry so close as I did buy this seven individual times.  And I would like space in between each entry.  If you remember I did cite the 1.27453 level as stiff resistance and it was right on time, the exchange rate fell hard when it tagged that line.  This is a test for the dollar to see if 1.26545 can hold, it is a challenge for the dollar index and at the same time the weakness of the Canadian dollar.  I will be watching crude oil closely too!

NZD/USD - textbook

Sometimes when you are involved in so many positions that causes an execution problem and the reason why I did not get involved in the Green zone there below is because I was having a difficulty with another pair and I did not want to take on more risk.  But one thing is for sure they are selling the rips, and even though this dip was bought it tells me that there will be another chance to buy it again and that if the pattern repeats itself is currently near a sell opportunity on the 1hour to 4 hour time frame.  

DIA

This week showed how powerful the equity selloff can be, this is an eight hour chart and it is a display of the newfound weakness in the Dow Jones 30 and I have found that the index still has plenty of downside as the red candles are becoming more frequent so for every four hours of trading is becoming more obvious that the trendline in red will be followed and that there are some powerful buyers near 21,500, where the yellow shaded oval is placed.  

SPY

The perspective I have here is that the average range of every weekly candle may repeat itself in this fashion and is likely that there are two key levels to watch for 243.73 which is a breach of this weeks strongest support point.  Once that is broken there is support where the market rallied at the end of June and early July and they were a catalyst for the most powerful weeks which happened to be total exhaustion for the bulls, they gave up and are retreating quickly.  If institutions are waiting on the sidelines with cash they are waiting for levels much lower.  The smart money knows that it is better to wait for severe percentage drops to find competitive buying opportunities.  I have found that between 234 and 236 there could be a lot of players involved (green shaded zone)

CBOE S&P 500 Vix Index

The goal was not only met but it was surpassed so the people and control have the task of bringing it higher and as options activity indicates it has the power to go to $21 or higher.  This also sets the count to longer than one week of upward movement in the Vix.  When the Vix gets very high it presents very low prices for stocks, there is a pot of gold at the end of the rainbow 

VXX 

I think the blastoff is in large part due to how intensely price was coiling at the blue arrows, the VXX had a daily range of 0.35 on July 31st! This year was marked by plenty of tighter ranges with this ETN, on the weekly chart I'll point out some of the tightest weekly ranges in recorded history (2010 to 2017)

I have highlighted some phases where the VXX spikes and compared the height of those ranges to extrapolate and determine targets on the "Hard right edge" of the chart and use previous highs as references too...

This is the weekly total range from bottom to crest, for every week for the 26 weeks starting 2/13/2017 to 8/17/2017:

1.64, 1.82, 2.27, 0.71, 1.52, 2.1, 2.22, 1.19, 2.08, 1.16, 1.09, 0.61, 0.75, 2.56, 0.78, 0.73, 1.06, 0.93, 0.47, 1.97, 1.21, 1.41, 0.74, 0.89, 0.34, 3.14

Profits are made from periods of low volatility to high volatility 

I was pleasantly surprised at how I was able to break off a fraction of my shares and sell them to watch it go even higher where I could have sold for more but I think it is because of that backwardation and contango dynamic where the S&P 500 does not need to be down that much to drive it higher that there is an internal force driving price when the Vix Index averages higher in aggregate during the rush periods.  The market drops let's say 5% and the Vicks was 20% this instrument moves at a velocity that is greater than I imagine.  Granted it is difficult to manage risk in such a debilitating timeframe but for me I have found that position sizing is my best choice.  

TVIX

This one I do not plan on treating frequently but it would be interesting to think about the best locations for drops based on how the S&P 500 trades and its own momentum.  Because they have a negative relationship I do not need to scale this trade the same way I would with VXX.  So when the time comes I can show some price points that I think are profitable long entries but I would be a seller at $40 because of the gap that was created.  It trades like VXX but it has a different rhythm to it.  

XIV

Tuning into the the trade timeframe has not been my strength but I normally find myself hedging my risk with this instrument as well.  I hope this is straightforward and demonstrates decent support points.  I am willing to patiently wait this one for as long as needed.  It swings inverse to VXX and frequently flashes excellent levels.