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On the 1 hour charts our 4 have pulled back and pausing for a fresh look at the order book to see if they might try a new assault on the recent lows or continue higher for more help/sellers/resistance.

The daily Dow shows what a strong support level this has been in the past and the pin bar bounce would indicate it remains so.

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Meant to add in my last post that the strong support was the point in @elle's post above it, though couldn't say what the badly cropped 3rd chart was all about. 😶

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oops ! Sorry. Price bounced off the Black Friday lows. Last chart is a tick chart showing how useful MAs are

 

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Fib Levels  - Do they work ?     So what next?

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21 hours ago, elle said:

Fib Levels  - Do they work ?     So what next?

Do Fib levels work?  -  yes - I mean no. Like all other technical analysis they work fine except for all the times they don't. Of course you can help the odds by adding some extra non Fibonacci numbers like 50 or 87. Or you could always add another level of probability for confluence, say a coin flip for example, so if in doubt flip a coin whereby heads = yes and tails = no.

It really all comes down to how many others are looking at the same thing as you, will there be enough to turn a prediction into a self fulfilling prophecy?

But there is another way. I like to sail and know that I need to be constantly aware of the ever changing force of the wind. Too much and the boat gets knocked down, too little and you are becalmed, so I make sure I'am always ready for either. I know that change can and will happen at any time so if wind dies down I add more sail, if it picks up I furl some away, simple. Can I predict when these changes are going to occur? - not really, I could take a guess but that's not very efficient.

Certainly it may be advantageous to have an idea when/where there might be an increased chance of change but best just to be ready and react when needed, it's a far more efficient and less stressful way to get to where you are going.

 

 

 

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Guest LiamS

Very well put Casey.

 

A great explanation of a very complex subject!!!

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Dow poised at monthly chart support level so the others will be watching carefully what happens next, minimal movement on Sunday. Dax retesting the Friday close and low on the European open. 

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Big V reversal in the Dow yesterday positions Dow and Dax to challenge the recent highs today while Ftse and Nikkei left looking a bit confused.

1 hour charts;

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On the daily charts and Nikkei sets the pace continuing on the upward leg so looking for Dow to follow and Dax to tackle resistance at 11048. Ftse has got itself up over the 6850 resistance level and will attempt to use as support for a push higher.

ECB rate decision 12:45 and another boring Draghi presser at 1:30.

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China releases negative data which is unusual in itself as China's made up figures are normally at least mildly positive. The admission indy production and retail sales are down substantially shows the trade war is hurting and has had a knock on affect on other indices overnight.

Difficult to say whether the morning session will bring recovery or continuation.

4 hour charts;

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Have been reading some interesting articles of late suggesting there is more to this trade war than meets the eye in that the US is not really looking to redress past misdemeanours but instead is more concerned with future ones.

It's beyond doubt that China steals products, then copies and regurgitates onto the free world market but what about doing the same with corporate ideas.

Block the likes of Amazon and Facebook from operating in China, steal the idea and copy the format and allow the copy to operate as a monopoly in the Chinese market which is big enough to create a mega sized company which then gets listed on the NYSE and then release it onto the world market. 

And repeat this process with every new corporate idea that comes along for the next 20  - 50 years.

Not difficult to imagine why some might be slightly worried by the prospect. 

 

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Starts the week with a strong bounce up Sunday and a challenge to recent short term resistance. The Dax looking for continuation on the European open.

1 hour charts;

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A few points to this post, first a look at the weekly charts, Ftse and Nikkei resting on support while Dax still trying to remain in touch. Dow slips below 24119 and will be looking for some relief from the FOMC rate decision tomorrow, a hike was expected but hikes don't usually happen when stocks are taking a hammering like this.

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Next a look at the Dow COT report and Large speculators still a reasonably healthy net long.

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And finally a chart you don't see very often, a quarterly S&P500. Nice looking bear engulfing to finish the year, interesting times;

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