- WE'RE JUST RANDOM SPECKS OF DUST IN A TORNADO TO THE MARKETS .......
- CHARTISTS MUST PUT ALL BIAS ASIDE AND LET THE CHARTS DO THE TALKING OR WE'LL SEE ONLY WHAT WE WANT TO SEE
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Thursday, 5 July 2012

Looking Toppy Here

SPX closed over the upper daily bollinger band on Friday but has not yet reached my trendline target from Tuesday. That would be at slightly over 1380 this morning. This is a decent probability area to see a reversal and retracement, especially given the NYMO setup I posted on Tuesday:
If that trendline target is hit then that would set up a nice looking rising wedge, with an obvious retracement target in the 1335-40 area (depending on when it was reached). An overshoot of a few points before a reversal downwards would look like a wedge overthrow, and suggest a significant top:
On ES we can see the same possible wedge forming and my ES trendline target today is in the 1378 area. The increasing negative divergence on the 60min RSI is worth a look:
There's a nice looking rising channel on the NDX 60min and the upper trendline there crosses declining resistance from the high in the 2670 area today or tomorrow. Again that is obvious strong resistance within striking distance:
EURUSD has been crumbling overnight and has undercut the late June low. GBPUSD is easier to call here as the RSI divergences on the 60min have been calling short term reversals very well recently. GBPUSD looks like it's close to another swing up. I've noted a possible failed break of declining resistance from the April high on the chart and that's worth watching:
On my main USD chart USD is retesting the IHS neckline again. That is obvious support but I've also noted the possibility of a move down to rising channel support on the chart:
Today's technical takeaways are that ES, SPX and NDX are all close to obvious reversal levels and that a significant retracement may well start today or tomorrow. EURUSD looks very weak this morning which is not supporting equities here.

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