2017 Juggernaut more than most people thought possible, the Top or Not?

The way I would like to organize the data regarding trend is I have a tendency of framing price action [for bullish continuations] in terms of Rally-Consolidation- Rally where it spends time basing inbetween before the next rally

Intra-day high printed at 23,177

I also would favor trading a bearish scenario where price drops quickly, tries to hang on to some gains, rallies back, bases and drops again.

But since most of the spring, summer and fall of this year, the pattern has been very consistent.  So I shaded the "character" of the underlying move.  That is to say that each of the rallies are boxed in with mainly bullish (daily) closing candlesticks and the corrective waves are mostly red and longer bodied bearish closes. 

I won't cite each date from start to finish, but the color-coding should do the trick.  The uptrend here is definitely in tact, so I would react differently in coding a way of trading things in an environment where falling prices yields profits.  That is not the case yet, even though corrections are a natural function of the stock market. 

The Expansive Thread

Focus of a series of videos - this one should be very long, and it has to do with a positive, neutral, and negative market cycle.  How these things affect market price behavior

1. Time and Volume 
2. Direction and Duration (how much time it spends in said direction)
3. The fractal nature of how things change; and the internals of how the buyers dictate the market

That image is one of the DJIA - Dow Jones Industrial Average and it captures a snapshot of the kind of comparison studies we are doing.  It is a visual guide to how price behavior acts during uptrends [its geometry] and how effective downtrends are in their swift actions

-Damian Richardson 

The British Pound Lash back - Daily Chart of GBP/USD

(1) The zone shaded in red is the point on the chart where I was being stopped out and selling short the GBP/USD

(2) The horizontal arrows denote sell short entry filled orders with the two locations at 1.360 and 1.34789

(3) I have averaged with enough size to over-take the levels where I was stopped out in the middle of the British pound rally, or dollar sell off

The horizontal lines above and below price shaded in grey and green are stop losses and exits.  I plan on exiting this trade near 1.32, but with a pyramiding strategy I could see myself add the same amount of size with 40, to 60 points in length.  Meaning if the pair continues trading down I will add to it with the same amount per trade.  This is scaling in, at its best!

Owning Your Mistakes

By the indications I drew on the charts it may have sounded like I was growing more bearish and inferring that the market would collapse and that the trendline would hold and that the target at 21,469 will be met but it turns out that did not come to pass and newer highs are already printed and you can see with the caption that says break it was the break of the all-time highs from August 8

It is not savory to make mistakes like calling the all-time tops but there are cases when a collection of different factors work together like seasonality and lower volume trading to that end those facts shaped some of my opinion going into the end of August of a lower market but is always a good idea to have a positive outlook and reframe the situation as something to learn from rather than be ashamed about it.

On the other hand a sign of strength is and how distribution days have been falling off account and they have been fading away with time when distribution becomes less powerful the market just tends to grind higher and the Bears need a cluster of those distribution days with higher volume to prove that they have a presence and that they are going to be selling at the peaks of every rally (counter-trend rally in this case we are not in a bear-market) also when I do a triple screen analysis I would be interested in checking every time frame to confirm a prices point on the curve or trend and whether it is at the high side or low side of the range.  And these types of conditions make it challenging because there are no other references for previous highs that can hold as resist points

The surge higher has been relentless that even though these are eight hour candles the stock market has yet to open for Monday's trading and it has already gapped higher (these candlesticks are continuous but ETFs and other equity markets have not yet stareted trading)

So it is early to be very bullish or think that the market go to 22,500 because there are a lot of political headlines coming and this week has an important driver which is the Federal Reserve decision, it is in my interest to see the markets down but I would entertain projecting prices at higher levels in spite of other factors working against it like not having a correction and the amount of time the rally has run its course.

Zoom Out then Zoom In

Hi Everyone

This first image is one of the yearly candlestick of the SPY which goes back to 1997.  Here is a description of what happened.  The market rallied for the five years after the technology bubble of 2000-2002, and then topped out in 2007 and had one negative year, the gigantic plunge in 2008 was contained to one year.

• Each year volume declined making it non-confirmatory

The drawing tool retraces the fibonacci levels from the March 2009 lows at 60 to today's high of 250

The 78.6% mark at $208.73 coincides with many of the orders that were filled in the 2015 and 2016 yearly lows and should be attractive again when mean reversion sets in.

Comparing candlestick chart patterns when price consolidates and then breaks out.  The larger view includes a 20 year history of the monthly candlesticks in red and white and the shorter term picture is this year which exhibits congestion that is occurring this week

The 20 year chart of SPY has a declining dotted yellow trendline in which each of the volume bars are respecting the decline very well.  The price and volume relationship has been a powerful indicator re: trend changes but in this market there are an infinite amount of possibilities.

Objectives Met

I thought these images would speak for themselves so I am going to be light on  the commentary today.  But here are three images: the weekly, daily and 4 hour chart in the EUR/USD.

Rough rejection of the dotted green line at 1.20583





Topping wicks proved strong enough to drive it down to 1.18762, and it also broke through the ascending trendline

Display of the most important resist point in the red shaded zone and a possible area of covering and resetting a strategy of buying the dip and selling the rip.  

The Quadruple Screen

Analyzing the technicals for the EUR/USD on 4 Time Frames Today

Weekly 1.20583 and 1.22639

• Resist point at 1.22639 was the "generator" for the sell off in terms of exacerbating the sell-off into the 1.10 and below territory, I would highlight this area as a much more potent target than how 1.20+ has held up so far as resistance for recent weeks
• Important week of 7/21/2012 it was a point of origin of one of the most powerful 2 year rallies in the currency pair.  It also denotes the effect of "former support becoming resistance" 
• The other inference from this chart is 12/27/2014 the first crossover of the dotted green line at 1.20583
• Price is 1679 pips away from the yearly trough

Daily: the break of 1.19284

• Breakaway gap created in April spurred on a long and powerful rally to reach our objective at 1.20+ but in the past 2 weeks there have been minute sell-offs that are shaded in orange (circles)
• The trendline in green captures a majority of the price movement and price has been flirting with a subtle break of it 
• For a true reversal with staying power price needs to consolidate and congest before finding overhead supply that sticks

 4 Hour

• Enhanced definition of psychological hit-points yet still maintains the uptrend
• the two negative days from the daily chart cast an overhead "seller" yet price is making an attempt to come back and try to smash through the over-head box  shaded in red at at 1.20546 and 1.20948

 1 Hour time frames

• More pronounced display of the difficulty of challenging the 1.20
• Appearance of "bounces" in each of the grey shaded supportive areas act as speed bumps in slowing price down when it gets to that location: 1.18445 and 1.18264 and the other two support points below