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Dax & Dow

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Dow tagged it's ATH overnight (= monthly chart resistance level purple) and has since just pulled back slightly, Dax is following. Good news data last week shows the US economy remains strong with mostly good earnings reported as well as emerging markets outlook improving bodes well for Dow, and where the Dow leads others tend to follow.

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Flags formed after a strong day yesterday, support seen at the daily pivot so looking for a break past yesterday's high and an attack on R1.

H1 charts;

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Little change so far, both remain in a bull flag. US non-manu PMI at 3pm 53.5 expected (see PMI chart).

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Still within the bull flag, Dax raced up to tag R1 on the London open while Dow looks at the daily pivot. Looking for a break of the range top and continuation.

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Dax and Dow maintaining the bull flag though Dax pushed up to tag R2 after the check of support following the London open for both Dax and Dow. Now following the US open and another test of support so will be looking for a test of resistance next.

H1 charts;

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Both remain in a bull flag. Interesting lesson here. Why isn't price going higher? Bulls have driven price up but at the moment see no reason to buy the high until there is new stimulus, price drops down to the bottom of the tight flag range, bulls see that as a buy the low opportunity. Not much of a low you say but as far as the bulls are concerned it's as low as they are going to get as things stand. Bulls are clearly in control and it would need real bad news to make them cover and run. You don't need technical analysis to see this, in fact covering the chart in TA is just going to obscure the picture and mislead, or even worse, cover the chart in TA in an attempt to bolster your bias for a move in the opposite direction. TA is just an indicator and market movers will use it or ignore it as they choose, same as any other indicator.

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2 minutes ago, Caseynotes said:

cover the chart in TA in an attempt to bolster your bias for a move in the opposite direction

ūüėĀ

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wtf, I was wondering why my alarms were going mad >

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Michael Hewson 

@mhewson_CMC

China Ministry - China and US have agreed to lift tariffs as deal progresses. Amount of tariff relief in phase 1 depends on content.. Equity futures rising.

7:26am · 7 Nov 2019 · TweetDeck

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Pullback overnight to the new daily pivot, if supported here will be looking for a retest of yesterday's highs. Not much on the calendar today but always the possibility of breaking trade deal news.

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Early push through up to R1 for Dow, Dax follows. Ger econ sentiment today though still negative is expected to show signs of recovery and Trump speaks on the economy at 5pm may impact the markets today.

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A tag on the highs just before London cash close yesterday and then a pullback to mid range. Both below the daily pivot this morning so would expect to see an attempt on the pivot on the London open, success or failure will determine either R1 or S1 as the next target.

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Dax and Dow looking to bounce up off S2 meanwhile more good news as EU industrial production m/m stays positive in spite of forecast to decrease 0.2%.

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Dow starting above the pivot while Dax starts below, usually see Dax fall into line and follow Dow when this happens. On the longer term time frames both are at or near their highs so expecting continuation until PA proves otherwise.

H1 charts;

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Dow has ramped itself up over R1 and looks content to perch there awhile, Dow attempting to follow. Will see on the London open if there truly is support at R1 or if needs to check lower. US retail sales at 1:30 otherwise not much on the calendar but as it's a Friday probably expecting caution rather than a further push to the upside.

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Dow just tagged it's all time high again just for the sheer fun of it and just to show it can. Been a disappointing week for 'the crowd', every morning hoping for the market to roll over and every evening having to choke on yet another ATH. But just as well really as someone has to provide the other side of the market. 

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I did some spring cleaning and I have three timeframes for the S&P500, Nikkei225 and Dax on my main monitor. It is partly because of this.

https://www.dailyfx.com/forex/education/trading_tips/post_of_the_day/2011/03/31/How_Many_Candles_Should_be_Viewed_on_a_Chart.html

Well this is what the Nikkei225 looks like with a yearly R1 pivot where the daily R1 pivot is and the Flash Manufacturing PMI in at 48.6.

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Dax attempted to break higher on the London open off the weekly pivot point but Dow stayed behind and looks content to wait for the US open.

H1 charts; 

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Dow drops down to check support after yesterday's highs and finds it at the daily pivot level, Dax follows. Dow looking to bounce.

H1 charts;

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In an uptrend the initial play at the start of the day is more often than not for a check to see where support is, Dax thinks Dow has found it at 28050 and has started back up to find resistance. We need to keep an eye on Dow to make sure this is the case while watching Dax head back to the daily pivot.

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5 minutes ago, dmedin said:

Zut alors ūü•≥

what happened? did i miss something

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@Caseynotes No I was just enthusiastic about the bounce off support.  There was a fairly big drop on the hourly chart last night.  :D

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3 minutes ago, dmedin said:

@Caseynotes No I was just enthusiastic about the bounce off support.  There was a fairly big drop on the hourly chart last night.  :D

yes, on news re; China, the pattern of late has been for Dow to find support in London session before girding it's loins for a march onward in the US session but can't really expect too much today¬†ūü•≥

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Caseynotes , you may be right about the news, but the drop started at 8 am Tokyo time.

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15 hours ago, AndrewS said:

Caseynotes , you may be right about the news, but the drop started at 8 am Tokyo time.

that's right @AndrewS, it wasn't Trump signing the bill that made to markets react it was the high level of vitriolic response from the Chinese and threats issued by a number of high ranking officials. They are convinced it's a Trump ploy to introduce new leverage into the trade talks but the bill was in fact introduced by the democrats and was actually a ploy to embarrass Trump. The Chinese don't understand 2 party politics.  

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