CPO - Waiting patiently for the big bear -14/9/09

We have all the indicators in agreement with each others:- the MACD has just crossed down its zero signal line; the Stochastic may be below the 20's zone but since the ADX has begun to rise, so I would watch the MACD instead. The 'oversold' Stochastic may mean the market will stay sideway for a short while before another real action is due. Add on more new sell position if market breaks below 2125.

On last Thursday, intra day price action went up and hit your stops at pre-determined lower Bollinger Band plus 5 ticks ,but only on the next day signaled you to re-enter a new sell again. You would NOT have enter any longs contract because all the indicators are still negative. The new stop would now be at 2203. This is another of those "unfortunate" things that can happen to any traders in any markets. As I always emphasize :- Preset your stops !


In the weekly chart, we have both the MACD and Stochastic falling and the MACD may fall through its own zero signal line which is an important confirmation for bearish signal. Price has also closed below the lower Bollinger Band . The weekly ADX has stopped falling and turned flat. But it is still below the 20's signal line which is telling us the market is still lacking a trend. I have drawn a horizontal line to mark out the prior peaks of the recent D+ and D-, so if the D- can take out those prior peaks, then I think the bear is official.

A similar setup is found at many of the other commodities charts (eg. crude), CPO regardless of the "fundamentals" should be following its "cousins" to take a great fall soon.