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S&P 500 Visual Trading Update

By:   Moshe Shalom
  • 2010-08-02 12:05:12 GMT
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Current Trading Plan:


Position: OUT
Last (04-01-2010) Closed position @ 1082 (+$0)
Long: --
Short: --
Exit by Stop Loss: --


Technical Indicators Notes:


Last time we said: "The obvious target for the whole down draft is the 1030 area. Meantime, we thought that we will get there more slowly, as in the initial part of the change in investors psychology. The problem is that the USD carry trade speed up things quite a lot!


RSI and MACD broke their respective upward trend line and the RSI-STOC combination is oversold, but in the early stages of a possible protracted period of time there. Price very far from the 20 SMA and should move to close some of the gap before resuming to the downside. Nothing to set our entry level on so staying out. Our position was closed at breakeven and we think that it showed once again how important is to minimize risk as much as possible."


We got very close to the 1030 cited target but then some deep pocket body with the help of short covering performed one of the spectacular about faces that we have ever seen. If this is the beginning of something greater than wave 2 of 3, we should see the index over the very strong resistance near 1100.


The pessimistic scenario is pointing to a reaction at the descending channel upper boundary. In any case, we are biased to the downside and will wait to position accordingly, when choosing the best risk-ratio possible.


Charts Legend:

In Price Window:

Simple Moving Average (20): Green
Bollinger Bands (20,2): Violet
Support & Resistance price areas: Pink and Light Green areas
Trend lines and Channel Boundaries: Blue
Elliott Waves Counts: Black and Blue numbers


In Indicators Part:
RSI (10): Blue, STOC(5,3,3): Green, ATR(5): Blue
MACD (12,26,9): Blue, Signal: Red, Histogram: Green
Indicator trend lines and effects: Magenta


Signals:


Long:  Above the Green line
Short: Below the Red line
Exit position: On crossing the Cyan line
SL in case of triggered level: Dashed Cyan Line


Green Wave Capital LTD (c) INFO@GreenWaveCap.com


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Content Provided by:
Moshe Shalom
CEO Green Wave Capital Inc, [Moshe.Shalom.GWC@Gmail.com] For the last 25, I have been involved in many of the aspects of the Financial Markets, while lately I concentrate on the implementation and education of Technical Analysis trading techniques, for private and coorporate clients.

Disclaimer:
By no means do any part of this analysis recommends, advocates or urges the buying, selling or holding of any financial instrument whatsoever. Trading and Investing involves high levels of risk. The author and his company express personal opinions and will not assume any responsibility whatsoever for the actions of the reader. The author may or may not have positions in Financial Instruments discussed in this newsletter. Future results can be dramatically different from the opinions expressed herein. Past performance does not guarantee future results. The content of this analysis was created with the best known data at the time. The writer and his company are not responsible for the accuracy or completeness of the mentioned data. The writer is not a registered consultant of any kind and so the reader should not see any single part or the whole analysis as an advice for any kind of action in the financial markets.


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