The markets were advancing nicely at the start of trading. The
Japanese Nikkei advanced 113 points after unemployment claims in the US
came in better than expected. The Australian S&P/ASX was also
advancing 63 points or a little over 1.4 percent. More than half of the
stocks held on the Nikkei 225 were advancing. The technology sector was
showing strong gains as Pioneer Corp jumped 8.41 percent, Cannon Inc
climbed 2.99 percent, and Toshiba was gaining 2.79 percent.
The Reserve Bank of Australia has released their monetary policy
statement in which they state that the economy will expand three times
the pace in which it forecasted back in August. The bank expects gross
domestic product to rise 1.75 percent this year and on to 3.25 percent
in 2010.
Trade Plan of the Day: TheLFB Trade Plan is Usd/Jpy,
one of the six that are available to members on the major pairs each
day, plus four Jpy based cross pairs, S&P futures, oil, gold, and
the dollar index.
S&P Technical View: TheLFB Member Charts
Daily chart trend: Long. Main price points: 1080-1100. Looking for: Wave 5 or C top
The price structure on the daily chart is showing two valid
scenarios. On the left side of the chart below, it shows an impulse
structure with five waves up from the 665 lows to the current highs. If
this is the case, the wave 4 discussed on the weekly chart, below, will
be rejected, since the fourth wave is a corrective wave, which means it
cannot be sub-divided by a five wave move. However, in this scenario, a
three wave push lower into a corrective blue wave 2, with a targets
somewhere around 950 area is expected.
On the right side of the chart, we have a different picture, with a
wave count that with a zig-zag correction, which is valid for a wave 4
scenario. In this case lower blue wave 5 will follow.
Overall, the current price structure signals for a coming turning
point with at least three wave push lower over the coming weeks, since
the market is trading around the top of wave 5 or wave C leg.
The MSCI Asia Pacific Index has lost 0.64 points or 0.55 percent during the session.
Overnight, the Japanese Nikkei advanced 113.46
points (1.17%) to 9,830.90. The Australian S&P/Asx was advanced
63.70 points (1.41%) to 4,571.70.
Crude oil was recently trading at $79.82 per
barrel, higher by $0.20. The commodity has traded within a fairly tight
range during the previous day.
