Inter-market Technical Analysis using algorithmic pattern detection
MONDAY MARCH 22, 2010 06:34 ET
Exactly as anticipated here last week, the high beta stocks were in the vanguard of the retreat during Friday’s session. I would suggest that the Russell 2000 may need to revisit the 660 zone - which is where the 20 day EMA is to be found - in coming sessions.
The chart for AUD/USD is unfolding in a manner which suggests that two key levels of support - annotated on the chart - need to be tested. If neither of these holds then the evidence would strongly suggest that an intermediate term top appears to be in place.
Here are my comments from Friday’s commentary:
On the hourly chart, Germany’s DAX is looking like it is running out of steam as it attempts to move above the current top of the range which is virtually at the January high.
In particular, I would also point to the manner in which the Bollinger bands have tightened, as well as the RSI is showing divergences, and this suggests a breakaway move is imminent. We could well see a substantial move in this index in European trading this afternoon when the US markets open for business.
As can be seen on the 60 minute chart recorded during European trading on Monday, the base of the cloud has been penetrated and going to the next major time frame - the 240 minute chart - the next line of support occurs in the region of 5800.
The ETF focus for today is on the oil services sector fund, OIH, which has suffered two days of selling on reasonably substantial volume. As can be seen the base of the pink cloud provided an intraday support area in Friday’s trading and this may assist rebound efforts in the near term, but the dynamics are suggesting that this fund is range trading but with a more pronounced downward bias emerging.
TRADE OPPORTUNITIES/SETUPS FOR MONDAY MARCH 22, 2010
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.
For a more comprehensive listing of price formations detected by our pattern recognition algorithms please visit TradeWithForm
DSX Diana Shipping Inc.
Amongst the numerous daily patterns which are now available to premium subscribers here , several of the shipping companies registered negative technical patterns from an Ichimoku perspective. The chart for Diana Shipping (DSX) is one which has dropped below the cloud and Kijun Sen value in Friday's session, and also violated a short term trend line through the low from early February. Further deterioration towards $13.75 is my expectation.
OSG Overseas Shipholding Group Inc.
Overseas Shipholding (OSG) resembles the pattern seen for DSX with a more obvious violation of the uptrend since the early February low. I would be looking at the short side on a rebound to the $44 level.
SEA Claymore-Delta Global Shipping
The exchange traded fund, SEA, allows one to take a sector approach to global shipping companies, and I would be targeting the area indicated on the chart - to be achieved during the next few sessions.