CNBC REPORT
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LET?S FIRST LOOK AT THE FTSE 100 INDEX
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Two weeks ago we identified the 12th-day down as the last day to hold the up trend.˜ We identified the move down as only going to ª of the entire move up since April, indicating a small retracement and thus an indication of a strong trend still in force.˜ This would indicate at the very least a test of the high and at best a resumption of the trend. Last week the index had rallied three days and I indicated the index needed to move above the third day to validate the forecast.˜ That did occur and now the index is down one day followed by an inside day.˜ The price did drop below the three day high from last week and is a small sign of weakness within the trend.˜ But we could anticipate some congestion as it approaches the ?obvious? previous high.˜ If it can leave a one bar counter trend behind by moving higher it would again indicate the trend is healthy and a ª extension should be a reasonable objective.˜ Or better said it should be able to move above the August high as much as it moved below the August high.
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LET?S TAKE A LOOK AT THE S&P 500
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There is some contrast between these two daily trends.˜ You can see how the daily US trend has been a bit stronger by holding the previous highs within the trend as the last move down in the FTSE went through that support level.˜ This is pretty minor stuff but it is worth noting.˜ The index is now up to the obvious resistance of the old high with a clear 5-wave structure.˜ I would anticipate some congestion near the old high as that is ?obvious? resistance.˜ That congestion can represent a great buying or selling opportunity.˜ But we must wait until the pattern is complete.˜ How markets behave at the ?obvious? is very important and can be very helpful and profitable if it continues or reverses trend.˜ Remember the normal counter trend is one to four days so the index should not exceed 4 days down otherwise it will have exceeded the normal counter trend for a trend up and would therefore either be trending down or still within a consolidation.˜ I forecast this would be a very powerful move up, this week should confirm or deny that probability.
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CRUDE OIL
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Last week we looked and crude oil and determined it was within a time window that could bring in a high, but we also had two other windows.˜ We could also see a weak move up from the last low and I indicated unless the index could show a daily price low on top of the high of August 30 there would be a fast move down, which has occurred. The index has matched the previous July decline in points but not in time as that move was 8 days down and this has been 6 days down.˜ This move down could be part of a larger sideways consolidation or it could represent the start of a trend down.˜ I won?t know which until I see the first rally.˜ The market is down to the ?OBVIOUS? support of the July high and the previous low.˜ So a rally from this location would be normal.˜ The strength of the rally will indicate the strength or weakness and even the possible change in the direction of the trend.˜ If it is one or two days and a new low is hit the next day.˜ Then the top to this oil market may be at hand.˜ We may get some confirmation this week?so next week we may have an answer.˜˜˜
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CNBC ASIA
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LET?S LOOK AT THE HANG SENG DAILY CHART
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Remember, the index found a low on the 8th day down above the support level that was critical for the up trend.˜ The high was an exhaustion style of trend and the correction left an Island base as a low, as you can see in the chart.˜ The index moved up past the 4th day of rally (which I explained last week as very important) and exhausted the short-term move on the sixth day up.˜ That sixth created a wide range day that opened outside of the previous days range and fell deeply into the move up.˜ The Index is now testing the bottom of that spike and is very important.˜ If it cannot move below the low of that spike within four days it throws the odds in favor of the next move being to the upside.˜ A move below the spike low (other than a marginal) would have negative ramifications especially following an exhaustion move up into the August high.˜ This is now the third day down. The next two days are very, very important.˜ Personally I believe the index will hold the spike and turn and rally but at this point that is a guess until the next day or two are worked through.˜˜˜˜˜˜
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NOW LET?S LOOK AT THE AUSTRALIAN ASX 200 INDEX
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Two weeks ago I said the index was going to stop trending up and would go into a consolidation pattern of some sort.˜ This has occurred and last week the index rallied two days towards the high and was turned back.˜ I believe this sideways pattern needs to expand; the range is a bit too small. There is still an upside objective yet to be met so I believe this will churn for a while, then make a final burst up to end the bull campaign.˜ But that may take a few months of congestion before that occurs. I?m still looking for 4614 in the ASX 200 INDEX.˜ That price is very close but I believe it may take a while.
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CRUDE OIL
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We haven?t looked at crude oil charts for a while and we?ll take a close look next week. The market is at a critical point in both price and time and we could get a confirmation of a change in trend by next Monday.˜ This has been a classic blow off style of trend in crude oil.˜ Once this corrects more in price and time that the previous large correction, we can assume the trend has changed.˜ Some of the contracts have come down to the ?obvious support? of a previous low.˜ IF the rally is weak and a new low is hit, the possibility will exist for a change in trend.˜ We?ll possibly know or have some confirmation by next Monday.˜˜˜˜
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Disclaimer: All the reports and content in the entire McLaren Report web site (including this report) are for educational purposes only and do not constitute trading advice nor an invitation to buy or sell securities. The views are the personal views of the author. Before acting on any of the ideas expressed, the reader should seek professional advice to determine the suitability in view of his or her personal circumstances.
