|The rally of the past two weeks has brought the market up to test the underside of the trend line formed from the 2009 low. The bearish cross of the 18 and 40 week moving averages indicates that the trend is down at this time frame. Any move below last week's lows would confirm the down trend, in my view. Keep an eye on whether or not the hourly chart down trend channel that I posted yesterday continues to contain prices. If (if!) it does, the bearish view will gain stature.|
Sunday, 10 July 2011
www.avidchartist.com is primarily a diary of some of the charts that I use in my trading. Why create a public diary of my charts? I think it will help keep me focussed on trading only the clearest trends and patterns.
I use charts to identify tradeable edges. I try to resist using them to forecast future market action. I don't think anyone has discovered a reliable model for forecasting financial markets, either via chart analysis or fundamental analysis.
As a trader I take entry signals from the hourly candlestick charts. I prefer to take signals on the hourly chart which align with the trend on the daily chart. Even better if the daily chart trend is aligned with the weekly chart trend.
I will most frequently post about the S&P 500, ASX 200, EUR/USD, AUD/USD, GBP/USD, Gold, and Silver, as these are the markets that I most often trade. Also I take an interest in the Chinese, Indian, Japanese and UK markets. I like to review all the above markets at least once each week, but most days I will only post about the markets that I am actively trading or watching. From time to time I will post about other markets which catch my eye.
There is a lot more to trading than just charts. Trader psychology, position sizing, and money management are far more important to successful trading than the ability to identify trends or trade entry triggers. Each of my favourite trading books offer much insight in to these topics, and I will touch on them sometimes also.
Lastly, a little about myself, the author. I live in Australia, and have traded for my own account for over a decade. I hope that this website will be of some interest and value. Please leave comments, or email to let me know your thoughts, or to ask any questions you may have.
I have seen several stories in the Australian media recently about the Aussie dollar being at record highs against the British Pound. The AUD/GBP is not a pair that I have traded, but the contrarian in me thought it would be worth looking at the chart, to see if the proliferation of media stories is indicating a top.
I can see a Cup and Handle continuation pattern on the chart that has broken out to the upside, indicating that the bullish run by the AUD against the GBP likely has further to go. The pattern has a target of 0.70, derived by adding the height of the cup, to the breakout price. The cup is approximately 0.04 in height, and the breakout price was around 0.66.