FCPO - Bull kicks And Mulls- 11/3/2014

 
 

Last Monday saw price went lower than the prior day low and that effectively closed off my earlier buy positions. I placed a tight stop as the previous week's technicals were not too encouraging whereas price was still contained within the bands and DMI was also within the 20/30 lines. But I quickly bought in again on Tuesday again when price went higher than prior day high and above the top band. The MACD continues to improve and move higher. The Stochastic stays positive but now it has entered into the overbought zone, so I would want to watch that one. The DMI is positive with the D+ at 41's. The D- has sunken to 17's. Both of them are at their extremity, so I would not be surprise to see some retracement next. Price has now successfully broken away from its recent fractal high of 2223 and it is ripping away from that level fast. The ADX has begun to rise, so this is confirming a new cycle.

I am placing my stop at below the top band.

 

The weekly chart continues to improve for the bull. Price has now closed above the middle band which is the de facto  20 periods moving average and it has also closed above its recent fractal high. The MACD and Stochastic stay positive and continue to rise. The Stochastic has just crossed above its 50's signal line which many technical traders use as a buy/sell signal point. The DMI may still be negative but the D- continues to fall fast which mean the sellers are closing off their shorts positions and the D+ has just crossed above its 20's signal line. This is something that I have been looking forward to as a solid signal that the buyers are coming in with strength. The ADX is falling again, this is hinting the end of the prior bearish cycle. All these are finally turning the weekly chart over back to the bull.


 

The monthly chart is turning. Price has just closed above the bottom band which is good for the bull. But though both the Stochastic and MACD has been turning around but both of them remain negative. Price would need to stay upward in order to turn these 2 to positive by the coming month. The DMI stays negative but the D- continues to fall downward from the 30's signal line which is telling me that the sellers are leaving. But the D+ stays below the 20's which means the buyers are still not in yet. If the monthly chart can continue to improve, then it would warrant a completely new reading of the whole market.

As I have been saying for the past few weeks, both the longer term time parameter charts have been flashing some subtle hints that they are moving over to the buyers side. So if we can have the market stay around these levels or going higher, then the whole market scenario may demand a new reading which should favor the bull over the bear.