Daily Form June 15, 2009

Detecting Profitable Patterns For Active Traders
Trade successfully without having to be right about the underlying market direction
MONDAY JUNE 15, 2009       05:36 ET

Present on many charts there is a template pattern which is typified by the one below i.e. a very steep slope through the lows since early March and a top to the pattern which extends back to the early 2009 high.

The sideways drift which has been in place since the latter part of May continues across most of the broad indices, including the S&P 500 and the DJIA.

The one index which I found through scanning the charts which is giving some evidence that it may be breaking down from this relatively uniform pattern is for the KBW Insurance Index (KIX).

There is some evidence that asset allocators are moving back into the US dollar during the last few sessions and, as discussed here last week, the euro currency seems to be unable to sustain itself above the $1.40 level.

In European trading on Monday morning the currency is heading back towards the $1.38 level at which there is chart support/resistance and also the 50 day EMA. I shall be watching this level closely during today’s trading in North America as a failure at this level would point towards a more bullish outlook in the intermediate term for the US dollar.

The Brazilian Bovespa Index (BVSP) reveals a pullback channel while it is attempting to revisit the most recent high achieved at the end of May.

This is also taking place within the context of a clearly evident negative MACD divergence.


The patterns identified below should be considered as indicative of eventual price direction in forthcoming trading sessions. None of these setups should be seen as specifically opportune for the current trading session.
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EEM  iShares MSCI Emerging Markets Index  

EEM, the sector fund which tracks the MSCI Emerging Markets Index, is drifting upwards but there are some divergences which echo those seen on the chart for the Brazilian Bovespa index reviewed above.

DD  E.I. DuPont de Nemours  

Dupont (DD) is revealing a bearish flag formation.