For the Week of October 15, 2012
The Trade Spotlight advisory service applies the GBE trading methodology (buying or selling commodity contracts based on breakouts of chart formations and technical indicators) to identify one to two trade setups per week.
Highlighting This Week’s Potential Breakouts:
December 2012 Canadian Dollar
The December 2012 Canadian Dollar has formed a 1-2-3 Top Formation. The twelve month contract high was made on September 14 at 1.0359, this set up the number one point of the formation. The market pulled back to 1.0099 (10/03/12) setting up the number two point of the formation. The market turned around trading as high as 1.0256 (10/05/12) stopping short of the contract high by roughly 40%. This is the number three point of the formation. In addition, there is a upward sloping trend line with touches at 0.9620 (6/28/12), 0.9745 (7/25/12), and 1.0099 (10/03/12). A close below the trend line and a break of the number two point of 1.0099 would trigger a short entry. A close below the lower trend line would also be a close below the 50 day Moving Average. The MACD and Stochastic indicator crossed over to sell signals already. The Trend Seeker (a US Chart Company tool) is currently Down.
December 2012 30 Year Treasury Bond
The December 2012 30 Year Treasury Bond contract is trading along a downward sloping trend line. There are touches at 151’29 (9/04/12), 154’17 (7/25/12), and 150’06 (10/03/12). A close above the trend line would trigger a buy entry. It appears the market will need to settle currently at 149’18 or higher to close above that trend line. The Trend Seeker is currently Down but the ranking is Weakest. Perhaps it will take a break above the high of 151’29 (9/04/12) for the Trend Seeker to flip, providing the upside confirmation. The upside target could be the twelve month high of 154’17 (7/25/12). A close above that high would trigger another entry to the upside based on the Hi-Lo Breakout Formation. The MACD and Stochastic indicator crossed over to bullish signals already.
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