The revenge of the swine

Swine have been getting all the bad raps recently because some idiots pin their name to a nasty flu pandemic even they have little to do with it. As a result, they lost many of their cousins in Egypt when their not too smart government started to cull their population.

And somewhere else in other part of the world, some people who think they are more pious than others may also wanted to make use of this and eliminate the swine population once and all.

Amongst all these bad publicity, Lean Hog futures has been dropping like a rock the past few days. But as soon as WHO clears their name, see how they bounces back with a revenge.



But then if you look at the bigger picture, Lean Hogs futures did not started falling because of the flu, it had actually started falling since July last year. The flu merely brought in more sellers.

Squeeze me a little HARDER baby !!!

I just have to write on crude oil again.

As I last wrote on this commodity in February and April, and today it is still caught in a range. But behold ! The range has been getting tighter. I have marked out its previous range with 2 horizontal lines 1-1 and it is doing its current range within horizontal lines 1-2. I have decided to show you the Bollinger Band in a separate chart panel where you can see how the band has been squeezing tighter and tighter in a clearer visual form.

As text book Bollinger Band squeeze would usually foretell that a monstrous extreme move would soon happen. As the ADX has been residing below its 20 signal line which has been confirming its trendless mode. Please note that this has been carried on for the past 4 months, my experience tells me the longer this has been dragging on, the more extreme would its next moves be.
A similar pattern was with the CPO which consolidated for a year and a half before blowing up from 1,200 went to do 4,500+ .

The Bollinger Band sqeeze and the low vlaued ADX only tell us that an explsoive move is on its way. The bullish divergence (higher troughs with lower lows) found at both the crude oil's daily and weekly chart is telling us a bullish move should be expected.

I have been telling some of my friends on this exciting item and all of them just shook their head in disbelief. They said crude has "no logical reason" to go up, especially in a big way since the whole global economy is currently in a rot as there will be no strong demand. If you want me to tell you a reason, I am sorry I cannot. I certainly am NOT a fundamental 'expert', I can only read charts. Who knows, maybe there will be a major arm conflict coming in Middle East again (so what is new about them?) You know, there is always a possibility that the Israelis jump the Iranians. Or could someone stage a revolution in Venezuela and overthrow the big mouth President but in the process, blowing up their refineries ? Anything could happen these days.

But at the moment I am trembling with excitement as each day passes by just watching this chart. And I think I would soon be getting nose bleeds. Not very unlike watching this

CPO - 4/5/09 market stalling ?

CPO:-

My stop of 2480 was taken out. But on last Friday price again triggered a new buy signal as it closed above the Bollinger band at 2513.

But I would get more cautious as the Stochastic has already crossed down its 80's signal line and the MACD also has crossed down its moving average. But the most worrisome item would be the daily ADX has been above both the D+ and D- which is usually a more reliable overbought signal. And it has also turned flat which may confirming its prior trend may has ended.


But as per last week's reading, CPO's weekly chart remains bullish as its MACD has crossed up its zero signal line which is usually is a more bullish reading. The weekly ADX still rise which is telling us that this trend is still intact. Thus we have here a weekly chart that contradicts the daily chart.

But since the daily chart readings have already turned weaker, I would place my stop at 2530. And I would start looking at the return of the bear if prices go below 2385.

FKLI 4/5/09 - Consolidation ?

The market did a retracement and hit our stops at 971, so we would had taken out our long positions. But we would have gone back and bought at 979 when prices went back up and closed above the Bollinger Band.

The MACD has now tightened up and may just crossed down if price is unable to go further up. The ADX has also go flatten which is telling us the prior trend has stalled, at least for this moment. The Stochastic has also crossed down its 80 signal line. All these are telling us to be cautious.


There is still nothing in the weekly chart to warn us of any impending return of the bear. With prices still stay above the Bollinger Band top and both the MACD and the Stochastic still continue to rise. With the MACD is fast approaching its own zero signal line which is usually a more bullish buy signal.

So at this moment I would keep a stop at 978 just in case the market is doing a retracement or a consolidation. And I will add on more position if it closes above its recent high of 1003.

CPO 27/4/09 - take some cautions

I made a typo error here as the stop should be 2340 instead of 2430. My apology. If you had followed that, then you would got back in when price broke up above its recent high.

On the daily chart, I continue to have a bit of worry as last week. But this time the reason is lightly different because the ADX has started to rise again which is telling us the trend is back in action and taken out my projected high of 2,600. But I get a little worry because the Stochastic has now formed a minor bearish divergence as it is unable to form a higher peak to reflect the higher price. Though as last week, the MACD and the Bollinger Band has not flashed any sell signal, but I would now keep a tighter stop at 2480.


But again the weekly chart seems to contradicting the daily chart's cautious mode as it is getting increasing bullish. Its MACD has crossed up its zero signal line which is usually more bullish. A most wonderful reading would be the weekly ADX has now begun to rise which is telling us a trend may be in formation. So with these 2, I am now starting to watch out for 2830 for its next target.

You say "2,820" ? But the global economies are in a serious recession. Yes, hell what I know these big issues, leave them to the 'experts'. I only read what is in the chart and try to educatedly arrive at a conclusion, If you want some form of fundamental "assurances" for this rally, ok, try this - the crude oil may soon start its big bull ?

FKLI - 27/4/09 - What me worry ?

The market just continued to climb higher contradicting all your experts' preoccupationed bearish thinkings. This is just another fine example of their standard behaviors that when the market warrants cautions and they get euphoria, but when the market is already confirmed in a bullish mode, they turn unnecessarily "prudently cautious". As I said last week that I have no reason to believe that the bull is over as there were no yet signals in the charts.

The daily ADX continues to go higher and now it is at 44 which is confirming the market's strong trend. As long the ADX is at high level and rising, we should keep our eyes on the MACD indicator as it is a trending indicator. Many people have been warning you on an "overbought" situation in this market because they see the Stochastic has gone in to the 80's zone and they think the market may weaken soon. In a strongly trending market, an overbought oscillator indicator can stay "overbought" for weeks or months and price will just reach one new highs after another without any corrections. Of course I think nobody in this world can tell us for sure when that a move will end, but for us technical analyst, we need to see some evidence to warrant such a comment.


Meanwhile the weekly chart met Well Wilder's extreme point trading rule by going higher than the previous week's high, so the weekly chart signal is confirmed . Both the MACD and the Stochastic continue to be positive and rise. In another word, the weekly chart's bull is well supporting the daily one. And I note the weekly MACD is fast approaching its own zero signal line, when crosses, it would present another buy signal and this kind of signal is usually a more powerful kind.

At this moment, I would just place a stop at 971 to protect profit . Other signs I would keep a watch out will be a MACD cross down or the Stochastic crosses down the 80's signal line or the ADX turning flat or start to fall. Otherwise why worry so much about the return of the bear and misses out all the fun ? Since the market has already breached 996, I would look at its next target of 1050's and to con what our politicians always say: "God's willing,", we may even see 1115.

KL Stocks - Dgate, DPS and Gpacket