Sunday, June 29, 2014

FCPO -  So Soon The Party's Over ? - 6/30/2014

Though the market got another push on last Monday when it managed to close above the top band which is usually a good sign for the bull. But price action quickly frizzle out for the remaining of the week and gave back all the gains. I decided to close off my trade on last Thursday when price went below the prior day low as the Stochastic is already in the overbought zone . If you have decided to wait out , the last day to get out of the trade would has been last Friday when price went below the top band.

By last Friday, the market has triggered a  new sell signal as price went below the top band with the Stochastic went below the 80's signal line. I would sell on the coming Monday when if price goes below the signal day low of 2436.

Though the MACD remains positive , the DMI has already turned negative with the D- quickly rising above the 20's signal line. This is telling me that the sellers are rushing back in again. The D+ has fallen to 20's which means the buyers are fast closing off their long positions. I wrote about how unimpressive I was about the MACD's so called "golden cross" as it happened relatively far below the zero signal line. The recent market rebound was not too impressive.

The weekly chart remains friendly with the bear, especially when price went up to test above the bottom band and unable to hold onto the gains. The MACD continues to slide and it is below the zero signal line which is very bearish. The Stochastic may be inside the oversold zone and turned positive, but I need to see it crossing up above the 20's signal line before getting excited about it. The DMI stays negative with the D- continues to decline, this means the sellers are still getting out while the D+ rises means the buyers are back to test the market. But I remain more bearish inclined with this chart. The weekly chart Japanese Candlestick is of no particular significance, but with a long upper shadow that happens at the higher range of a minor recovery, this Candlestick may mean some possible selling ahead.

Both the daily and weekly chart are giving more bearish signals than bullish signals now. I think the technical rebound is over and am expecting another round of selling coming around the corner. But I secretly harbor some faint hopes that I may still see the return of a bull cycle at a not too distant future. Of course I am not saying this simply because I pluck something out of the air. And it is certainly NOT about the climate, war or other crops performances. There are something developing in the longer term charts that warrant my opinion. I would  explore on this in the coming weeks.

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