Technicals | Oct 30 2020
Bottom Line 29/10/20
Daily Trend: Down
Weekly Trend: Down
Monthly Trend: Up
Support Levels: 3200 / 2950 – 2800
Resistance Levels: 3589 (all time highs)
Technical Discussion
Reasons to remain longer term bullish:
→ Elliott Wave count continues to have motive bigger picture
→ Support / resistance zone 2950 – 2800 continues to hold strong
→ higher degree Wave-[4] may still require further coiling yet immediately bullish count remains preferred
‘…. since then price has traded down to 3419 with no significant reaction from buyers coming into play just yet. So this means, at least more immediately, that price action is remaining a little weak. So some further testing of strength around the old major support / resistance zone circa 3400 may still be required over the coming days.’
Last [Wednesday] night we were hit with a negative session. The price bar was wide ranging, closing on its lows, and on above average volume. Combined with the session starting off with a gap open south ! Not a great look ! If price shrugs this off tonight [last night] and we reverse immediately from here, then this will keep our preferred wave count on track. With a wave-iii of (iii) of 3 potentially the next stage we will witness which is exceptionally bullish. [Wednesday] night’s clean out move was strong though, so we do need to proceed with an element of caution right here and now.
The move also keeps the door open for our alternate count to play out which is the one we have annotated in red on our chart. This is still looking for the larger (A)-(B)-(C) move to continue evolving which began back in February this year. It still requires further depth though if this is the way the dice rolls. With the support zone circa 2950 – 2800 remaining in focus. Lots going on at the moment with the upcoming U.S elections, combined with Covid-19 concerns. On top of it being reporting season in the U.S. Hold onto your hats as its going to be a very telling next couple of weeks !
Trading Strategy
Our formal recommendation to trade long at 3432 with stops placed at 3305 was exited last night with our stop being hit. It was certainly a negative session as stated with price needing to immediately reverse tonight if our preferred black annotation is to play out. Being secular bullish on U.S markets we will continue to look for opportunities on the long side. Yet for now being back on the sidelines is the only place to be until clarity can return. Especially within the short to medium term time frames.
Re-published with permission of the publisher. www.thechartist.com.au All copyright remains with the publisher. The above views expressed are not by association FNArena's (see our disclaimer).
This report may contain advice that has been prepared by The Chartist Pty Ltd (ABN 40 641 323 051). The Chartist Pty Ltd is a Corporate Authorised Representative (CAR No. 1282007) of Shartru Wealth Management Pty Ltd ABN 46 158 536 871, AFSL 422409. Any advice is considered general advice and has been prepared without taking into account your objectives, financial situation or needs. Because of that, before acting on this advice you should therefore consider the appropriateness of the advice having regard to your situation and your own objectives, financial situation and needs. We recommend you obtain financial, legal and taxation advice before making any financial investment decision. If the advice relates to the acquisition, or possible acquisition, of a product (other than a security e.g. a CFD) then the client should obtain the relevant Product Disclosure Document and consider it before making any decision about whether to acquire the product. Past performance is not a reliable indication of future performance. This material has been prepared based on information believed to be accurate at the time of publication. Subsequent changes in circumstances may occur at any time and may impact the accuracy of the information.
Risk Disclosure Statement
THE RISK OF LOSS IN TRADING SECURITIES AND LEVERAGED INSTRUMENTS I.E. DERIVATIVES, SUCH AS FUTURES, OPTIONS AND CONTRACTS FOR DIFFERENCE CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER YOUR OBJECTIVES, FINANCIAL SITUATION, NEEDS AND ANY OTHER RELEVANT PERSONAL CIRCUMSTANCES TO DETERMINE WHETHER SUCH TRADING IS SUITABLE FOR YOU. THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN OBTAINABLE IN FUTURES, OPTIONS AND CONTRACTS FOR DIFFERENCE TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS. THIS BRIEF STATEMENT CANNOT DISCLOSE ALL OF THE RISKS AND OTHER SIGNIFICANT ASPECTS OF SECURITIES AND DERIVATIVES MARKETS. THEREFORE, YOU SHOULD CONSULT YOUR FINANCIAL ADVISOR OR ACCOUNTANT TO DETERMINE WHETHER TRADING IN SECURITES AND DERIVATIVES PRODUCTS IS APPROPRIATE FOR YOU IN LIGHT OF YOUR FINANCIAL CIRCUMSTANCES.
Technical limitations If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.
Find out why FNArena subscribers like the service so much: "Your Feedback (Thank You)" – Warning this story contains unashamedly positive feedback on the service provided.
FNArena is proud about its track record and past achievements: Ten Years On
