Spy of the week.
This week we continued with the somewhat chaotic moves of the market. The direction was clearly up, but almost all of the previous week’s trading days were very volatile, and closed very close to the day’s open. This behavior frustrated a lot of traders as they got into trades just to find the market’s direction going against them all week long…
Straight line connects opening and closing price, 5 days in a row:
Although the direction is up, Laguerre filter starts to show signs of taking a more decisive position, and finally heads lower in a clear way. This is the first time since October last year that we had Laguerre pointing lower. This is giving us a sigh of a temporary weakness of the buyers in the market. Let’s wait and see at what level the buyers will fight back…
Next major support level is situated in the 153.00 area
As for apple (AAPL), things still look very nice for short sellers, price below the declining Laguerre Filter with high red volume regarding green volume. Putting on the Darvas Box into play, we can see the price flirting with the 385.10 level, indicating a short position from there.
Fundamentally speaking apple is in bad shape regarding its biggest rival Samsung. This is already reflected by the recent downtrend of AAPL, but a break under 385.10 could signal a bigger, longer downtrend:
Metals smashed by investors
As we are stepping out the second quarter of the year into the third, investors are apparently quite determined about their position in Gold and Silver. As better than expected economic numbers of the FED made their way to the market, investors continue to dump Gold and Silver, a classic reaction to sign of an economic recovery.
Laguerre Filter continues to act as the gauge of the market, pointing down for the last 8 months.
Declines with high red volume also confirm the bearish sentiment:
Dollar gaining some ground.
After a month of a weak dollar, we can see a clear rebound, not only on the major pairs reflected by the $DXY (Dollar Index) but also on the more exotic ones.
When the FED says/hints he will reduce the Dollar printing, it obviously sends a buying signal to investors saying “Hey, US dollar is now getting scarce, you better catch them while they are cheap…”
On the USDJPY we saw a nice rebound from the Laguerre Filter, looking good for the weekly intermediate term.
EURUSD is still very close to the weekly downtrending slope, waiting for the right moment to break through. Laguerre is getting flat sending a neutral position signal.
If you remember our comments for the AUDUSD a few posts ago, we were a little worried about the breaking of the important 1.00000 level, with Laguerre Filter starting to point lower. Indeed, this was a major bearish sentiment and the Australian Dollar didn’t get any stronger like its fellow currencies, but continued to show weakness:
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