20090530 - EURPLN, CHFPLN

The EURPLN has broken trendline and made higher high:



The CHFPLN chart looks alike:


Last market actions negate the symmetrical triangle formation (this post).

Both currencies generated the daily buy signals, but the weekly downtrend remains intact.

We should observe the market closely in the next week, especially if the last weekly higher highs (4.60 for EURPLN, 3.05 for CHFPLN) are broken - in that case we should consider possible trend reversal.

The polish Monetary Policy Council, cut the mandatory reserve rate to 3% from 3.5% (here).

Sources:
[http://online.wsj.com/article/BT-CO-20090527-709610.html]

20090529

There was quite volatile session today. The WIG Index fell -0.45%:



We still have to wait unless the market leave the 29000-30700 area. The oscillators divergences are bearish, declining volume suggest general indecision among traders.

The US market finished more optimistic (here) and that can be a clue for the next week.

I'm going for short holidays, therefore don't expect updates for the most part of next week.

Sources:
[http://www.marketwatch.com/story/us-stocks-slightly-higher-in-choppy-trade-materials-up]

20090528

The WIG Index lost -1.08%:



Impasse situation, area 29000-30700 holds and nothing new can be said. The lower lows on oscillators are well visible and that is not encouraging sign.

Interesting interview with the founder of the Vanguard Group - Jack Bogle (here).

Sources:
[http://www.marketwatch.com/story/vanguards-bogle-time-is-on-your-side]

20090527

The WIG Index gained +1.93% today:



Today's rally is impressive, nevertheless the general situation has not changed. The WIG Index remains between 29000 and 30700; we have to wait until it breaks out of this area.

There is comparison S&P500 Index performance against active management (here). As per S&P500 Index methodology - few interesting facts about its math (here)

Some analysis of current US market (here).

Sources:
[http://www2.standardandpoors.com/spf/pdf/index/SPIVA_Report_Year-End_2008.pdf]
[http://seekingalpha.com/article/139758-the-s-p-500-five-things-you-probably-don-t-know]
[http://seekingalpha.com/article/139675-strong-buying-pressure-a-quick-look]

20090526

There was quite volatile session today:



The WIG Index has made lower low on daily chart, however it's still in error margin. Nothing new can be said; there are some negative signs: negative divergences in both oscillators and the volume is decreasing.

Still, the best approach now is to wait for further market actions and hoping our stop-loss orders won't be triggered. Picking the bottom is quite risky now.

There is strong rally in US market today (here or here).

Sources:
[http://www.marketwatch.com/story/us-stocks-rally-on-consumer-confidence]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aiJ_X115pjKM]

20090525

The WIG Index fell -0.69%:



For several sessions, the WIG Index is moving in the ca.29000-30700 area.
We can note some bearish divergences on both oscillators and volume is decreasing, but nothing certain can be said right now.

The uptrend is still intact, therefore the odds favor the north direction. Nevertheless, in my opinion we should act carefully and it's the best to wait for further market actions.

Quite interesting article why we should always protect our capital from Investopedia (here). Obvious, but sometimes surprising facts.

Sources:
[http://investopedia.com/articles/02/022002.asp]

20090523 - EURPLN, CHFPLN

The situation in EURPLN is still unclear:



The CHFPLN looks alike:



We might drawing the symmetrical triangle formation, however the currency market is hard and formations are unreliable there. The downtrend favors continuation of fall, but we don't have a sell signal yet.

Sources:
[http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns:symmetrical_triangle]

20090518

The WIG Index gained +1.59%:



We are still above 29000, but below last high. We have to simply wait for proper market action, as for now not much new can be said.

S&P500 closed with +3.04% gain (quite small volume), It might be a clue for tomorrow's session.

Few interesting articles over the weekend:

• Quite long, but good review of global situation - nevertheless noteworthy (here).


• Comparison of current market with 1930 bear market (here).


• Few views on current economical situation (here).


• Another indicator-based view on US market (here).


• DJIA's solunar model (here).

I'm going for small holidays. Therefore, there rather won't be any updates to the end of this week.

Sources:
[http://seekingalpha.com/article/137999-current-recession-is-tracking-the-1930s-bear-market]
[http://seekingalpha.com/article/138067-opposing-views-of-economic-imperatives]
[http://seekingalpha.com/article/138197-sectors-indicate-correction-not-reversal]
[http://carolan.org/2009/05/12/wind-shift/]
[http://seekingalpha.com/article/138118-global-markets-in-review-pros-and-cons-of-a-pullback]

20090516 - EURPLN, CHFPLN

The EURPLN has not made new lower low:



The CHFPLN chart looks similar:



We have rather expected both currencies to generate weekly sell signals over the last couple of days, but it did not happen. Nevertheless, currencies still remain in downtrend.

20090515

The WIG Index closed the gaps from 4th May and yesterday, eventually gaining +0.39%:



Technically speaking, nothing suggest a deep correction as of today: volume is decreasing on fall, both oscillators are above their latests' lows. However, we have made quite a gain from last low and the market seems to be unsure of future direction.

US market has lost significantly over a last couple of days (here or here):



The US market might be some clue, however we are not making any prophecies here. We have to simply wait for proper market actions and remember the current uptrend has not been negated yet.

General Motor is preparing for probable bankruptcy filing by June 1 (here).

Sources:
[http://www.marketwatch.com/story/us-stock-futures-lean-higher-before-data-wave]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=a8ohmbRCnrLY]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aFuILYrqujRs]

20090514

The WIG Index fall -0.62%:



We did not manage to close the gap from 4th May fully. There are no new signals from the market: oscillators are still doing fine, the volume is descending on drop.

The level of 29000 seems to be important support. As per our ideal setup (this post: well, not so perfect anymore as the market did not reach 31500 in last swing), the market should rebounce from this area and make higher high. However, that's just a guessing game and there is no reliable way to forecast that.

As per weekly uptrend we should hold to our long positions until the market tells us otherwise.

20090513

Quite volatile session today. After high open the WIG Index fall -2.21%:



The market might want to close the gap from 4th May, but today's situation is hard to interpret. Both oscillators are fine, the volume increased, however the WIG Index has been continuously losing all day.
Nevertheless, the weekly uptrend is still intact.

News portals are explaining today's drop as renewing economy concerns after earnings data (here or here).

US housing April's data is not so encouraging (here).

Sources:
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aVX0.kLKOFjI]
[http://www.marketwatch.com/story/us-stocks-lower-on-economic-concerns-djia-roughly-down-200]
[http://www.marketwatch.com/story/us-foreclosures-reach-record-rate-in-april]

20090512

The WIG Index gain +2.37%:



The gain has been made with moderate volume (nevertheless, higher that yesterday). There is nothing suggesting weekly trend reversal.
We are still waiting for proper market action, hoping that our position won't be closed prematurely on stop-loss orders.

Holder portal suggest, that polish mutual funds are reducing their exposure to shares:



US market recorded quite volatile session today (here).

European Union will follow US example of stress-testing by September (here or here).

Sources:
[http://www.marketwatch.com/story/us-stocks-end-off-lows-ahead-of-retail-sales]
[http://www.reuters.com/article/euRegulatoryNews/idUSLC2575120090512]
[http://www.bloomberg.com/apps/news?pid=20601068&sid=avlvfVcq401Q]

20090511

The WIG Index fell -0.79%:



Descending volume does not confirm the drop. Also both oscillators are rather encouraging.
Forecasting the market is a guessing game; however, the uptrend favors long positions now. We should use this correction to extend positions, nevertheless place defense orders in case we are wrong.

Sound Advice announced new supercycle starting (here). Nevertheless, mind there are also less optimistic views (here).

Sources:
[http://www.marketwatch.com/news/story/New-supercycle-may-starting/story.aspx?guid={FD3EE9DD-23CE-422F-9B71-0D7F91343703}]
[http://seekingalpha.com/article/136863-where-is-the-economy-headed-four-bearish-views]

20090509 - EURPLN, CHFPLN

Over last couple of days, the EURPLN has been quite near weekly low:



Situation on CHFPLN chart is alike:



The daily sell signal has been generated on both currencies. The weekly low has not been broken yet.

European Central Bank decided to cut interest rates to 1% (here).

Sources:
[http://www.taipeitimes.com/News/worldbiz/archives/2009/05/09/2003443121]

20090508

The WIG Index stayed neutral (-0.8%):



Last few days the WIG Index has been struggling around level of 30000. The current setup visually suggest correction, nevertheless there are no technical signs for any drop and we are still above the open gap from 4th of May.

Descending volume show indecision in the market, but the weekly uptrend is intact. Therefore as per trend we should buy into it. We are not able to forecast the future direction of the market, thus always place a stop loss order and use proper money management - even in case of dramatic drop we should have our capital preserved.

US financial institutions stress tests' results are available here. Results show, that several banks need to raise more capital to cope with current circumstances (here or here).

Bloomberg has tested few technical analysis strategies based on oscillators over S&P500 index. Results are quite interesting (here).

Sources:
[http://www.federalreserve.gov/newsevents/press/bcreg/20090507a.htm]
[http://www.huffingtonpost.com/2009/05/07/stress-test-results-banks_n_198797.html]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aSrwXWx4jGQw]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aM76hi1IDeOo]

20090507

The WIG Index fell -0.56%:



The higher high has been made and weekly buy signal has been generated. The target from symmetrical triangle seem to be realized (usually this pattern give about 80-90% of projected swing size).
Few on-line analysts are expecting a correction now, however there are no technical signs of even short-term reversal yet; we have to simply wait for proper market actions.
The significant drop at the end of session is confusing, nevertheless the weekly trend is still intact.

China warns the Federal Reserve to pump more cash into the financial system (here).

Few words about Warren Buffett (here) from the end of 2008. Currently Berkshire Hathaway Inc. is trading much lower (here or here).

Sources:
[http://www.thedisciplinedinvestor.com/blog/2008/10/02/warren-buffett-genius-or-thief/]
[http://www.marketwatch.com/news/story/China-central-bank-says-Fed/story.aspx?guid={2B1DC06C-6E35-4C7F-8291-8C3D3CB7283E}]

20090506

The WIG Index gained +0.37%:



General situation has not changed and not much new can be said. The overall trend is upward and we should buy into the trend. Both oscillators and high volume seem to confirm the north direction.

US bank stress tests seem to have quite good results (here or here).

Sources:
[http://www.marketwatch.com/news/story/Tests-show-some-bank-capital/story.aspx?guid={79FA759F-F5A3-4111-8CE8-611E73B2529B}]
[http://www.bloomberg.com/apps/news?pid=20601087&sid=aMrqninDRIIw]

20090505

The WIG Index fell -0,80%:



The market rallied for two weeks and correction will be natural.
We are not able to give any reliable forecast now and we just have to wait for meaningful market actions. Nevertheless, current uptrend seems to be strong and any retracement might be good place for entering positions (always with stop-loss orders).

Let's also take a look at global situation:



Current rally is the biggest in this bear market (almost +50% from the bottom).
Of course, the drop might continue, thus buy-and-hold strategy is not a good choice in current economy situation. Nevertheless, we should be able to earn some profits now.

Here is quite interesting article about bear markets' rallies during Great Depression, which can be a good reference point to our situation.

Sources:
[http://seekingalpha.com/article/135331-don-t-be-fooled-we-ve-been-here-before]
[http://en.wikipedia.org/wiki/Great_Depression]
[http://www.investopedia.com/terms/b/buyandhold.asp]

20090504

The WIG Index rallied +3.44% today:



The weekly buy signal was generated. Increased volume and breakout in CCI seem to confirm upward direction. It also seems the main trend has been reversed, however we would like to wait few more days to see if the WIG Index remains above 29000 and it's not bear trap.

There are two patterns we might want to consider:

• The symmetrical triangle pattern (as per chart) gives us target price ca.31500.


• The inverse-head-and-shoulders pattern has been drawn on the chart, with target price ca.38000.

The preferable scenario will be rally to ca. 31500, then retracement to 29000 and rally above last high. That will be perfect scenario; nevertheless, we have to work with what we see, not what we want to see.

Some thoughts about current economic situation in general (here).

Quite interesting article on banks (part 1 and part 2).

Here are few ideas for the big question if we are still in bear market?

There is a very interesting entry in Airelon's blog about trading in general. Make sure to watch video.

Sources:
[http://seekingalpha.com/article/134546-do-you-believe-banks-are-recovering-part-1]
[http://seekingalpha.com/article/134549-do-you-believe-banks-are-recovering-part-2]
[http://www.trystero.pl/archives/3028 (via Google Language Tools]
[http://seekingalpha.com/article/134586-monitoring-the-economy]
[http://investorandtrader.blogspot.com/2009/05/find-your-bias-for-entrances-video.html]
[http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns:head_and_shoulders_b]
[http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns:symmetrical_triangle]

20090502 - EURPLN, CHFPLN

The EURPLN is still in a weekly downtrend:



The CHFPLN looks alike:



Both currencies remain in a weekly downtrend. Latest rallies seem to be reversed already (subjective opinion), but there is no technical confirmation yet and currencies like to make surprises.

The European Central Bank is expected to cut interest rates again in May (here or here).

Sources:
[http://www.forbes.com/feeds/ap/2009/05/01/ap6366628.html]
[http://www.independent.ie/business/irish/tighter-bank-standards-put-pace-of-lending-growth-at-15year-low-1725679.html]

20090430

The WIG Index rallied +2.63%:



The pennant/symmetrical triangle formation (yesterday's post) has been drawn on chart with target price ca.31000.

The weekly buy signal has been generated as the level of 28650 has been broken. However, we are just below the important level of 29000 and it's risky to open positions right now. We shall wait until this level is broken and confirmed later (preferably with rebounce and increasing volume) - capital preservation is a priority and we don't have to rush.

Not much else can be said - next few sessions might decide market's future direction.

Tomorrow there is no session.