Saturday, July 23, 2016

The Process of PRICE ACTION ANALYSIS - Expanded Version by MegaTrade101

Insight through the Eyes of Sir Alexander @megatrade101 (Brief excerpt) EXPANDED VERSION

Be able to improvise a structured strategy that will 'Challenge the Status Quo' from traditional trading analysis, unconventional methods in market analysis approach works simply based from actual market experience. Prices are merely a trader's guide,  while the market dictates where the direction would lead to and not the other way around.

At times, certain market conditions provide unconfirmed signals from price action & behavior even before it occurs. This is where trader / strategist  develop a true sense of their trading abilities; best described sometimes as intuition. Others may call it ' instinctive analysis'.


Friday, July 22, 2016

Classic EUPHORIA Market in the Making!

With the DOW & SP500 closing in their respective highs, no one dare to declare that the cautiously steady rise of stock market prices have given some analyst / traders including main street investors at a four (4) way cross road, between uncertainty, indecision, reluctance and anxiety rolled into one. Such prices are indeed at their highs. And not a lot of market participants would want to be set on the high side of the market.

With these current price levels, anxiety has been more prominent market sentiments with 'Volatility Index' (VIX) on its lowest levels at the moment. While momentum gains are reflected correspondingly with the DOW's prices at their highest levels giving a signal of positive breath contrary to some analyst continued call for a major decline. This can only happen after the fact. And the VIX is quite the more favored tool to measure the market' price action, but not enough to necessarily push investors to get in on these high levels and missing out the probability of a continued rally in the making. Or it is already one!

Classic EUPHORIA Market in the Making!

Thursday, July 21, 2016

A Matter of Market Perspective - The Right Way

An Important Observation on Tech Chart Presentation & Analysis

As we came across with this chart, it is extremely noticeable that the diagonal line to project a US DOLLAR resistance level of exhaustion was not properly made. the same goes with the horizontal line that should have been drawn across without any obstruction. A valid line across the bars are used only to identify certain chart patterns that resembles from a valid true signal nothing more than what it is intended for. Yet, point well taken that the trading range has been established.

However, coming from a prominent technician / strategist this should be avoided. With all due respect, these publicly shared analysis carries a degree of misconception on the part of viewers who may also have a clear understanding of the market  Thus the market interpretation maybe considered ineffective to a certain degree of analysis.

NOTE: The name on the chart has been shaded to protect and not to discredit the author. But we just thought that it was deemed necessary for other viewers to be keen on their market analysis & chart lines to derived the RIGHT MARKET INTERPRESENTATION

Compare the above chart with MegaTrade101 Version which also includes the Linear Regression when applied at its current market condition appropriately well within their respective channel direction.


Yes its the 'Fear of Missing-out' on the Rally!

The analogy is similar with the high stakes of a Baccarat game; where the Law of probability after the banker (Central Banks Monetary Policy) wins, is how the (Market Investor / traders ) player's side ends up winning 9 consecutive (trading days) on the DOW JONES setting new highs thereafter.

The first two quarters of 2016 has indeed been a roller coaster ride, at the beginning of the year and followed through the end of the 2nd quarter. These moves were reflected on the price charts on the DOW & SP500 with similar configuration in a few other indices tracking both markets.

Summary Money Flows & What's next?

Wednesday, July 20, 2016

NOT JUST FX, On Equities too!

DOW Follows through @18562 levels

The strong US #NFP / #JOBS figure recently released couple with better-than-expected #EARNING reports have now become the main catalyst for the US stocks & Indices to stay afloat in positive territory. The price action signals starting from holding above the 17000 - 17500 - 18000 - has fueled enough interest for a return to equity trading after the BREXIT vote.

The strong USD holding above the 95.05 - 96.50 - 97.10 currently at simply gives the FED some incentives to continue its intended rate hike for the year. But then again, before this happens will provide stock secular bulls to take this rally further for as long as they could against others in the back-drop that has been calling for a major correction of 15%.

NOTE: That the prices came from a consolidation period, that also signified a widening price range that it has established. Hence a simple approach to combine with Price action analysis, is a disjoint angle of projecting a high is based on the declining trajectory line of the lower band. At certain times, unconventional trading rules works during certain market conditions. Yet, prices did marked above 18500 before it occurred.


FX Market:

With soft opening prices across the board in the FX market, the focus on the Aussie & Kiwi were the exception to the rule as price reactions to data released have pushed both pairs lower. While the USD has held steady all though out the US session.

Meanwhile, the Euro retest below the 1.1000 and with Cable back towards the 1.3100 levels are still heavily bias on negative territory. Both CCY pairs opening slightly higher at the Asia session last Monday were merely a corrective move. As we mentioned that these corrections seen even with stocks are 'Healthy' market signals that such directions are still on course.