For the Week of September 29, 2014
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:
The December 2014 Mini Dow contract has created a solid support level near a 50-day Moving Average (16827). The contact tested this level on 9/15/14 by making a low at 16839 before rallying to a new twelve-month contract high at 17279 (9/19/14). As the contract once again approaches this support level, watching for an opportunity to get short. A break of recent support may pressure prices lower. The support level goes back to June and July with a series of highs and lows. A downside target is the low of 16143 (8/08/14). MACD, a trend indicator, is bearish above of the baseline. The Trend Seeker (a U.S. Chart Company tool to help identify a market trend) is Up. For trade confirmation, the Trend Seeker must be Down. Perhaps a close below the support level or the 20-day Moving Average crossing over the 50-day Moving Average will cause the change. Momentum is bearish as the Stochastic indicator is headed downward above the “over sold” level.
The December 2014 British Pound contract is setting up a long entry opportunity if the price trades through recent highs. Using the 1.6404 (9/23/14) high as the breakout price. The 9/19/14 high of 1.6515 is being discredited as this high was made on news of Scotland remaining part of the United Kingdom. This high actually sets up a short-term target. The next target would be a previous support level near 165.50 where the contract traded near the end of August. The Trend Seeker (a U.S. Chart Company tool to help identify a market trend) is Down. For trade confirmation, the Trend Seeker will have to be Up. The MACD, a trend indicator is bullish below the baseline. Stochatics, a Momentum indicator, is flat. The 20-day Exponential and 50-day Moving Averages are pointed down as well. It may be awhile for this trade opportunity to setup meeting the criteria but its one to keep on the watch list.
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