KCPO - Bulls Losing The battle ? - 11/5/2012



The struggling bulls lost ground when price fell below the top band last Monday.  The signal day only materialized on Tuesday when the Stochastic turned negative. I did not sell until Friday when price finally went below the signal day low of 2379. My initial stop would be the recent high of 2410 plus 2.

The ADX is still falling and it has now gone below 20's. With this, so do not be surprise if price flip and down for a while.

 

 The weekly chart remains more bearish biased as price has now closed below last week's low. the MACD and DMI remain negative with the ADX still rises. The ADX confirms the bearish trend remains intact. The interesting item present here is the Stochastic which remains positive and still rising. This indicator has been forming a bullish divergence so I still would not rule out the possibility of a technical rebound soon. A word of warning here -  divergences are warnings/writing on the wall - something telling us big event that should be coming soon. BUT it does NOT mean they MUST materialize. Like everything in life, nothing is guaranteed. So whenever I see them, I will respect them and take great precaution but it does not I will immediately act on them on my trading. But if the Stochastic divergence fails, it would mean the bears will be monstrous.

For the past 2 weeks, there has been indecisiveness in almost all the major forex  and commodities futures markets.  Even a disaster event like Sandy failed to bring a smile to crude oil bulls. But many of those market seem to be near a pivotal point.  I am watching the USD with increasing interest, I feel it may about to smash many 'experts' in their face for claiming it is going to be worthless.