The decision on the liquidity injection by the world’s most important central banks led to some beautiful price fireworks in the markets that we have under consideration. The concerted action is placing cheaper money at the disposal of the global banking and financial systems. With this signal the stock markets and the precious metals their respective Christmas rally wed had expected or they ended their several week consolidation phase expecting that a considerable part of the cheaper money will flow into the financial markets.
On Friday, with the new US jobless claims the prevailing euphoria seems to have been decelerated for the moment. But nevertheless, at least until the end of the year the markets are going to rise. So we traders must aim now to enter long into the market at any counter trend reaction increasing the investment rate.
By last week‘s price rise, in many of the GUNNER24 Up Setups the previously existing turn signals were confirmed, and a considerable number of buy signals and some relatively riskless long entry levels on daily and weekly basis were sifted out. Today, I’d like to present you 5 of them together with the possible buy targets.
Weekly buy signal in the NASDAQ-100:
As early as next week the buy entry might be triggered. Every weekly close above 2370 will be bought by us with target 2520. On weekly basis, since the July highs the index has been swinging to and fro between the 4th double arc and the clearly identifiable support Gann Angle. Since the issue of 10/09 we’ve been reckoning with new highs within 2-4 months in this index. In case the 2370 are broken next(!) week at any rate the NASDAQ-100 will end the year above the previous year-high (2438.44). Until spring 2012 the last top within an important weekly chart pattern shall have formed: A so-called Broadening Top (aka megaphone) here you may read up everything on that chart pattern. I think the markets (and the world) won’t be able to dive into a possible recession – brutally and finally – before this Megaphone Top (blue A) in the NASDAQ-100 will have been formed.
Technically the 5th double arc should be able to force the market down to its knees. This actually mighty resistance of the 5th double arc combined with one of the potentially most powerful reversal chart pattern MIGHT trigger the definite starting signal for the system crash that is supposed anyplace.
But until then we are still looking forward to some beautiful liquidity driven long signals on daily basis – for instance in the Dow Jones and the S&P 500:
As early as in the GUNNER24 Forecasts of 11/20 I worked out a possible "riskless" long entry on daily basis in the light of the actually valid daily 12 Candle GUNNER24 Down Setup. But that one wasn’t triggered because the important 1*2 Gann Angle support was fallen below by the candle of 11/23. With the rebound from the important 1*1 Gann Angle support (red/green oval) in the daily 9 Candle GUNNER24 Up above the index achieved to get back to the long term visible resistance of the first double arc. For the third time the first double arc provided visible resistance. Red circles!
Now the Dow is going to consolidate 2-3 more days, I suppose. A long entry is to be carried out as follows: A) Every daily close above 12115 next week will activate definitely the 12735 target and either B) the long entry in case of a retracement will be possible until down to the new support Gann Angle at 11780 – target likewise 12735. In both cases SL will be the 11385. It should also be understood that the October highs at 12284 will have to be broken at first, and there we’ll have to reckon with a counter reaction, even though a "relatively moderate" one. It would take a daily close below the 1*1 to deactivate the 2nd double arc as a middle term target on daily basis!
On Friday the index reached its week high at a natural GUNNER24 resistance diagonal (above in the setup anchored with the red X). The Friday spike candle is a new indication for a "stronger" resistance that makes us suppose that an overall 2-3 day reaction to this resistance diagonal will be due. The best long entry (best because of the least risk) is at the support Gann Angle at 1218. From there the market is expected to run up until the lower line of the first double arc at 1252. Then a reaction downwards will happen – the precise down target might be at 1230 – and from there shortly before Christmas, the market should definitely break upwards through the first double arc. A second long position will make sense then, of course! Main target is the 1325.
The „relatively high" level of this main target must signify that the banking sector shall develop above average. At the main target a very violent turn downwards is to be expected. Only in case of a daily close below the 1*1Gann Angle this scenario will be negated.
As forecast in the last issue, gold and silver did end their several week consolidation, being again on their way to the 1790 and 35.30, respectively. Here come the actual weekly up setups, originating from the September lows:
Gold formed an 8 week up impulse that consolidated until the 50% mark. This retracement is normal, further allowing that at least the first double arc on weekly basis will be reached rapidly. Double top or all-time high – both will be possible at short term (until the end of January/beginning of February). Since, according to the rule 18.4, last week also a reversal candle at a Gann Angle formed (Complete GUNNER24 Trading and Forecasting Course) we may speculate on long without hesistation.
That’s why next week we’ll buy back a possible test to the Gann Angle support at 1725. It’s a buy on daily basis. First target will be the Blue Arc at 1790. Main target will be 1940. SL will be a daily close below the 50% initial impulse retracement (1667).
A tangible weekly buy signal at a weekly close is emerging above the first square. Overcoming the 1801 is a strong buy signal, for in that case the target is forcibly(!) the first double arc. In case of a weekly close above 1801 we’ll go long with another tranche – on weekly basis as well - with target 1940.
Silver buy signal:
Silver is only forming a five week up impulse. The consolidation also lasted 5 candles (end oft he consolidation is the low of the actual week candle). But like gold the nasty little brother retraced its ascent by a 50%. And like in the case of gold the actual upwards trend at the Blue Arc (35.30) in the weekly setup above is expected to provide considerable resistance first. Here again we would use a weekly close above the upper first square limit for the composition of a weekly long position.
A „slight" weekly buy signal has arisen with the actual week candle – a so-called reversal candle. Like in the weekly gold setup rule 18.4 is valid (Complete GUNNER24 Trading and Forecasting Course). On daily basis we’ll go into the market at 32.15 – at the weekly support Gann Angle. A daily close above 33$ would provide the final starting sign for the 35.30. SL for all the longs on daily basis are the 31$. The main target for this forecast is lying at 38.50.
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