TIP - The weekly TIP chart shows a parabolic rally stalled. Although it looks as if it can go for at least another 4 weeks, the daily chart shows otherwise. The daily chart shows that TIP has stalled and has retraced. The candlestick pattern and indicators are somewhat conflicting, and it remains to be seen if this stall is a continuation or a reversal. Breaking the recent low registered this week would complete the price action reversal.
JNK – The JNK weekly continued its rally and is expected to stall as the weekly is overbought on dropping volumes. The daily chart has by mid-week to reverse IF it is to reverse. Indicators are overbought and bearish divergence is almost completed.
DBB / /HG - The weekly copper chart no longer looks bullish but overbought. The daily chart has stalled and consolidation broke down the first trendline support. Indicators are pointing to a bearish week ahead for copper.
According to the above leading indicators, we are in for a likely volatile and consolidative week ahead – again! With a possibility of a start to a major downside. Yes, this week may be very bullish as the beginning of the month is usually so, but the S&P looks to burst up or down in the coming weeks after registering consolidation on low volume for many days. The /ES is full of dojis stacked together… this is a pre-cursor to a major movement, and I am looking for a significant correction at some point soon.
The MadScientist - 1 November 2010
Note: Any material posted here is of my sole opinion, and my opinion may differ from others. It is definitely NOT a solicitation to do anything else as a consequence of reading this material. The material presented here is intended for educational purposes only.