Friday, September 28, 2012

Corn futures (/ZC) leap higher from price channel support

Corn futures (/ZC) have rocketed up 5.6% today, up exactly $40 per contract and presumably triggering the exchange's circuit breaker, as there have been no trades or price change for approximately the last three hours.

The bullish movement began at approximately the area of support from a 21-month price channel. (The channel is colored grey below.) Further support was provided by the "round number" $700 level, which price action almost reached.

/ZC. Nov 2010 to present. Daily candles.

Tuesday, September 25, 2012

Mon, Sept 24: /GC, /SI, GOOG

Markets closed slightly lower today (Monday, Sept 24). The S&P500 was off by 0.2 percent, while the NASDAQ underperformed due to a 1.3% dip in Apple shares, that index's highest-weighted component.

Precious metals are hinting at consolidation or perhaps even bearish moves after their heady advance of the last month, fueled by QE3. The gold futures contract (/GC) today closely hugged the lower support line of its 1-month price channel, usually a precursor of a shortly forthcoming violation.

/GC. Aug 20 to present. Hourly candles.

Meanwhile, the silver futures contract (/SI) has already today violated its 1-month price channel. An extension of the lower support line of the channel currently stands at about $34.9; thus a throwback to this channel support line, if it should occur in the next ten or twenty hours, may encounter resistance near the $35 level. ('Throwbacks' were discussed in this blog's Aug 28 post, for those wanting a refresh.)

/SI. Aug 20 to present. Hourly candles.
Perhaps the most notable price action today among widely tracked large caps belonged to Google (GOOG). Today's 2.1 percent rally brought the security to over $120 above its 200-day simple moving average, a level of bullish sentiment not seen in 20 months. Moreover, today's close places GOOG just a hair above the resistance of a price channel stretching back to January 2010. The channel is not robustly defined, however -- for instance, the upper resistance line has been untested since its inception, and the slope of the channel could be adjusted upward to fully enclose the lows of July 2010. As such, the trader should discount the channel's bearish implications, at least temporarily.

GOOG. Sept 2008 to present. Daily candles.

Thursday, September 6, 2012

Green Mountain (GMCR) surpasses key resistance

Shares of Green Mountain Coffee Roasters Inc (GMCR) are rallying strongly in today's (Thurs, Sept 6) exceptionally bullish overall market.

Catalyzing the broad market, in brief, is an announcement of new monetary easing by the European Central Bank; as of midday, S&P 500 futures are ahead by just under 2 percent.

The story in GMCR is not its rally per-se; rather, the stock has surpassed the resistance line of a key price channel on the hourly candles chart, which may fuel further price appreciation. The channel is robustly defined, connecting all major local maxima and minima since March, and was discussed by this blog on Aug 21. A line of the same slope also models support and resistance for a handful of candles from early May through late July. The last two weeks of price consolidation have, furthermore, occurred just below this channel resistance, giving the line further validity as a support / resistance model.

GMCR. Dec 19, 2011 to present. Hourly candles.
As long as price action stays above this channel (above approximately $24.5), the outlook for GMCR appears bullish. The next significant test for bulls will be the August high at $26.69.

GMCR. Aug 8 to present. 5-minute candles.

Wed, Sept 5: BIDU, CELG, LIFE

Baidu Inc (BIDU) shares exhibited noteworthy price action on Sept 5. On the 5-minute candles chart, the security is seen reacting away from 20-day price channel resistance on Tuesday, Sept 4, and subsequently falling further on the 5th, albeit remaining somewhat above a double-low at approximately $110.15. Shares of the Chinese search engine were recently covered on these pages, as the stock was sharply selling off on August 23rd.

BIDU. Aug 16 to present. 5-minute candles.
Celgene Corp (CELG) showed a break of channel support from the hourly-candles perspective. The violated channel is fairly robustly defined and stretches back by approximately three months. That said, price action is at its 200-hour simple moving average, rather than below, so the chance of continuing price consolidation is relatively high.

CELG. May 25 to present. Hourly candles.
Life Technologies (LIFE) appears to be breaking through 3-year channel resistance, albeit doing so in both slow motion and on low volume. These latter characteristics of the advance increase the odds of the analysis being predicated on a mis-drawn channel, which is quite possible as the current channel is of only a moderately sound fit.

LIFE. Sept 2009 to present. Daily candles.