20080804

The medium-term uptrend on the WIG Index has been slightly broken, but it's still in 3% margin. The Jan low acts as strong resistance; support is on ca. 40900 (gap from 29 Jul):



The WIG20 Index has similar situation:



In next few weeks we shall be able to see how the strong the major trend still is. We shall not be trying to guess where trend begins or ends; instead, we should only invest when the trend continues.

More on US economy - we know the rising unemployment, but it also seems the average hourly earnings are getting down. For few nice charts check here. Data360 provided us with more detailed statistics here - just focus on last 2 or 3 years, but also remember that CPI math has been altered several times since. The real average hourly earnings are often referred as consumer spending leading indicator (try to get Ahead of The Curve, J.H. Ellis explains it in human readable form).

Also, if someone is interested in Fibonacci, a nice introduction by A.Farley can be found here.

Sources:
[http://seekingalpha.com/article/88746-slack-labor-market-in-pictures]
[http://www.amazon.com/Ahead-Curve-Commonsense-Forecasting-Business/dp/1591396913/ref=sr_11_1?ie=UTF8&qid=1217839398&sr=11-1]
[http://www.traderslog.com/fibonacci-tricks.htm]

20080801

ast session changed really nothing in big picture. WIG bounced from Jan low, nevertheless it's still uptrend. Probably the first few sessions in this week will show a medium-term market sentiment:



WIG20 is more bullish, just under the long term trendline:



Those trendlines are strong. I don't expect indexes to just cross those quickly. Theoretically, both indexes are in good to enter short-sell positions. Nevertheless, last two weeks have showed the market strength, therefore I would not risk money on that.

It seems that US economy is still having bad time. The weekly unemployment initial claims level spiked to 448k, an increase of 44k from previous weeks' revised figure of 404k. Full report can be found here. I would also mark something else - many US companies employ also a number of people in branches abroad and the weakening dollar does not help to reduce the foreign staff cost.

Sources:
[http://ows.doleta.gov/press/2008/073108.asp]
[http://seekingalpha.com/article/88542-analyzing-economic-data-the-employment-report]
[http://seekingalpha.com/article/88479-the-market-as-a-house-of-cards]

20080731

The WIG Index is touching the trendline from May, however I won't even try to forecast what will happen tomorrow. I have to admit I'm still bear, but very confused one right now:



If this is major trend reversal there will be many occasions and lot of time to join the uptrend, after it's truly confirmed. I like my money and I also remember the term: Bear Trap. Therefore I wait at least for Fibo 61.8% (which is not so far away anyway). Another strategy is Dow Jones approach, when we wait for correction and see if the next wave can take its high. Let's also take a look a monthly candlestick chart:



The WIG20 Index is looking even more impressive, however it's touching long-term (since the highest top in 2007) resistance. If this line is crossed and holds for at least couple of sessions, it will be very strong buy signal:



As for interesting stuff:
Federal Reserve is extending the emergency loans and also enables commercial banks to bid for cash loans that lasts 84 days (instead of standard 28 days). For more information please read here.
I don't have idea how to interpret that - nevertheless, nobody can tell, that FED is out of ammunition.

Sources:
[http://www.iht.com/articles/2008/07/30/business/30extend.php]
[http://online.wsj.com/article/SB121742140378196767.html?mod=djemITPE]
[http://www.investopedia.com/terms/b/beartrap.asp]