What did I say last week? I expect with all indicators oversold and the hourly chart making an up move, an intermediate up correction now. And yes this is what we got in this 4-day trading week.
Tuesday was very volatile and ended with a doji with a higher closing price than Friday before. All indicators were turning up from low oversold levels. So, I decided to open a new manual long position the next day if the up trend would be confirmed. I opened a new long position in the first hour of trading at 1034. On Thursday there was also a confirmation from the SATS2 expert. So, also here I opened a new long position, now at 1070.2.
Price and all indicators are moving up. I expect a further up move, in first instance probably to the level of the 200-day average around 1110.
I am using a slightly faster SATS2 now on the daily chart. This will give some more entry and exit points, but the advantage is that it will also be faster at the main turning points. With SATS2 we will only trade long signals and we will not trade if it is obvious that we are looking at a "false" SATS2 signal.
Elliott wave count:
Looking at the Elliott count, we may be finishing correction wave [2], now followed by a long term wave [3] up. This looks like a very optimistic long term view, most probably to good to be true! Another possibility is that the index finished a medium term correction wave (A) down and we expect next the medium term correction wave (B) up. Next followed by the wave (C) down, with an index remaining between 950-900 for the construction of the correction wave [2] at a lower point. However, since a single impulse wave ({1} to {5}) is normally not the end of a correction wave, there is a third possibility: we completed a long term correction wave [B] up and the index started are long term down move for correction wave [C]. This would be the worst case scenario with an index target below 650.
Pitchfork:
The index moves to the upper side of the pitchfork. This will be a first resistance level.
Fibonacci:
Price will in first instance probably retrace to the 50% level which is close to the 50-day average.
Support/Resistance:
There is support at 1040 and 1010. There is resistance at 1105 and 1130.
Indicators:
All indicators turned and are moving up.
SVE_ARSI (14 periods) indicator:
Moving up.
Slow Stochastic:
Moving up.
SVE_RSI_Swing:
Moving up.
SVAPO:
Moving up.
Volume:
Rising in the up move.
SVE_BB%b_HA (18 periods):
Moving up.
SVE_Inv_Fish_Stoch:
Up reversal confirmed.
SATS2 Expert:
The SATS2 expert turned green, there is a new open long position. We also have a new manual long position. These trades are shown at the end of the page.
Hourly chart:
Sylvain Vervoort http://stocata.org/
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