September Dow Jones - Dow Jones futures are trying to break the five-day losing streak, after chain stores from Costco Wholesale Corp. to Gap Inc. reported sales above projections. However, the market is finding it hard to break above the 20-day SMA resistance and is currently trading well off the daily high. If any rebound is going to happen, it will most likely begin on Friday's projected reversal date. The Dow Jones futures are trading lower into the swing trade date, setting up a potential bullish reversal.
September Japanese yen -Long from 1.0710 - Last price @ 1.0807 - Overnight, the Yen reached a high of 1.0877, just short of the 1.0900 target objective, but above the prior day's high of 1.0858. Since Thursday was a projected reversal swing day, this is a set-up for a possible consolidation or short-term pullback before the Yen can resume the upward trend into a major reversal swing day in late September. Hold the long position, raise the stop loss to 1.0775 and keep the target objective at 1.0900.
September Dollar Index - Long from 78.52 - Last price @ 78.53 - China has begun its move away from the dollar. It was reported that China has bought $50 billion in special IMF notes that it has in the past said could replace the dollar as the world's reserve currency. Chinese Prime Minister Wen Jibao has been saying for months that he is worried about China's huge investments in the United States, and China's central bank has said it would be good if the U.S. dollar was no longer the world's main reserve currency. The dollar is currently trading 10 higher. Exit the long position at the market.
September Canadian dollar - Short from 91.55 - last price @ 9054 - The bearish TR pattern (a swing trade strategy that signals a major trend shift) was confirmed on August 28. Since I have already closed the first short position for a slight gain, I used a retest of the 20-day SMA for the second sell entry. Hold the short position and move the stop loss to 91.75. The market is set to trade lower into the September 7 reversal date, with a target objective of 89.00.
December Hogs - Long from 47.62 - Last price @ 47.70 -Hog futures climbed to a four-week high, as wholesale ham prices rebounded, raising speculation that U.S. pork exports may increase. Hold the long position and move the stop loss to 4625.
November Soybeans - Short from $9.79 - last price @ $ 9.41 ½ - Soybeans traded below the prior swing low ($9.40 ½ on August 19th), but were unable to close below it. The cycle is still bearish into the September 9 reversal date. Hold the short position and lower the stop profit to $9.65, while keeping the target objective at $8.50.
9/3/09 - 9:56 am MST - Wednesday morning, I posted a chart of Dec. Gold, showing the projected reversal date and said Gold was ready to break out to the upside with an initial target objective of $993.60. Gold was trading at $967.30 at the time. It is one day later and Dec. Gold has reached a high of $994.60...$27.30 higher. That is what I call a breakout! Gold could continue to trade up to the upward sloping reaction line, but I would expect to see some consolidation at this level.
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Reversal Dates for the week of August 31- September 4, 2009.
Monday - Soybeans
Wednesday - Cattle, Soy meal, Crude oil, Heating oil, Silver
Thursday - British pound, Japanese yen
Friday -Wheat, Bean oil, Dow Jones, Cocoa
- Due to the volatility of the markets all trade suggestions are subject to change, at anytime during market hours, without notice.
*(TERMS YOU NEED TO KNOW)
(SAL=- Sloping Action Line) --(SRL =Sloping Reaction Line) --(RD = Reversal Date) -- (L= Long) --- (S= Short) -- (TC = Today's closing price)
Swing trading and Reversal dates
Every good trading signal needs three key elements to be considered a successful swing-trading signal. Time, Price and Pattern. When these three come together, great things can happen. If you can improve your timing or price entry, it can enhance any trading method. That is what the Reversal Dates can do for you. They will identify when the market should react, and at what price level the market needs to be for this to happen. They will even tell you what the market has to do to confirm the trade. The first thing I do is, identify Time.
The Reversal Date Indicator consists of three parts. The first is Time. This is identified by the projected Reversal date and will indicate which markets are ready to react and when the reaction should occur. The most common misconception about the Reversal dates is the idea that the market must reverse on every signal date, which is not true. Instead, The Reversal Date itself helps to identify the market's reaction. A high percentage of the time, the market will reverse the current trend, but not always. A smaller percentage of the time, the market will form a continuation pattern, indicating the market will likely continue in the same direction as the prevailing trend. Often this will occur during a consolidation or after a very small correction.
Once the Reversal date has been identified, the next thing to do is monitor the price. If the market is making a new high/low, or if it is trading inside a buy/sell window, then the second component of a trade signal is in place. You now have Time and Price working together. For most traders, that will be enough, but the Reversal Date Indicator takes it one step further.
After extensive research into price patterns, I have identified specific price patterns, which occur during reversal timing. These patterns can be used to confirm the market reversals or market continuations. When, and only when, these three components are all working together, will there be a swing trade signal generated.
For more information on our Reversal Date Indicator, or should you have a specific market question, please call us at 1-800-521-0705
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