We’ve Hit the Bottom, it Appears

Daily Analysis - 11/04/2018

Markets Slide to a Halt

sp-500-hits-bottom


World markets have effectively brought the slide to a hold. The US benchmark stock index, the Standard & Poors 500 Index has found support at the 2600 level and has tested it  2 or 3 times in the last  2 months and has been unable to sell at a lower price than that. A floor price for now. Because of the deep losses suffered by the market crowd over these last two plus months we will have to put some time spent above this support level to be able to say that the declines are truly behind us. The US closed quite strongly yesterday following on to a mildly positive Eurozone close and was followed by a strong session in Asia. Today Euroland looks less than stellar but is mildly positive.

AUDNZD is a Solid Trade


This pair has been a consistent earner for us since mid-October. We think largely explained by relative weakness in the Aussie as opposed to much relative strength in the Kiwi. Regardless, and it really is regardless because all we do is look at the chart of the pair to understand how to trade. This is a solid trade we hold short positions in which we are confident out until well beyond the next 30 days. We seek to extract our profits today at levels between 1.051 – 1.049 and will protect our position with stop loss orders between 1.055 – 1.057. Should you enter positions intended to be held for longer periods of time, say the end of the week or longer, adjust your stops, both take profit as well as stop loss orders, appropriately. Meaning extend them further above and below those stated here which are geared for short term positioning.

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Silver Rises


This is a technical trade, meaning that we base our thought on the movement in the price charts as there is little of fundamental import affecting the asset. The 20 bar EMA (exponential moving average) has closed above the 50 bar EMA which is generally a bullish indicator, meaning price is likely to continue rising. We see support for this upward movement between 16.450 – 16.465. We have stop loss orders placed between 16.747 – 16.689. {Should you have uncertainties or questions concerning any of these instructions speak to your broker or account manager for clarification. Proper execution is an essential of successful trading and must be mastered as soon as possible.)

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Royal Dutch Shell


This too is a technical trade. We are seeing these movement trades, largely as result of the steep falls from the last two months. As prices in the stock markets stabilise, the relative gains made by some stocks are significantly greater than those made by others. Such is the case with many of the energy forms. RDS is the best example of this class of trade. The 20 Bar EMA has closed above the 50 bar EMA which is a classic technical signal for upward movement. The positions are backed up by stop loss orders between 67.47 – 67.00 and our take profit order sits between 68.73 – 69.04. Note that there are gaps in this sudden uptick and that as a general rule these gaps will close. Meaning that currently the price is above these gaps, they will, come down to below where the gap opens up. Therefore, trade RDS for the short term until either the gaps close or sufficient distance in time is accumulated to forget the gap and trade for the longer term.

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