Archive for January, 2009

73% ACCURACY on Romania!!!

Though prices have failed to bounce from OCTOBER 2008 lows, the respective calendar lows continue to stand firm on BETFI. The bottom formation is now nearly 3 months old and even if there is another impending leg down, we continue to see current levels as a classical multi month lows than otherwise.

It’s keeping up this unequivocal view, we present to you the annual issue of WAVES.ROM accuracy report. We at Orpheus remain in the endeavor of measuring probabilities. But what has assisted us more than probabilities are the rules. Our readers are well aware of the our ‘TOP IS HERE’ comments on BETFI at 90,000. The slide was repeated for more than 20 days repeating the ‘TOP’ word before the current 90% collapse happened. Rules remain more important then perception, as human psychology remains flawed and error prone. Whether, it’s the need for news, which invariably comes late or it’s the need for blaming it on global markets, loss aversion, or the uncertainty bias, till we follow rules and a system, trading or investing will continue to cause us more pain than gain.

Nathaniel Hawthorne, a famous American novelist once said, “From principles is derived probability, but truth or certainty is obtained only from facts.” And the fact is that we have delivered accuracy with ‘stupid patterns’, as a conventionalist immortalized the study of patterns once. This is the second year in a row we have crossed 70% accuracy for BETFI. This means 70% of the time we were on the right side of the intermediate trend.

If we have to detail out something that we did get wrong, it was the extent of collapse. Classical Elliott points out to a 90% collapse in CYCLE II waves. We ignored this and starting looking at the bottom too early at 61.8% and 78.6% collapse. What kept us on the trend still was our flexibility to accept that price supports were not coming in and bounce backs were weak, and that we were wrong in anticipating a REVERSAL too early.

WAVES.ROM studies intermediate and minor BETFI trends. In 2008 we made 18 intermediate and 21 minor trend forecasts. We have measured accuracy on the intermediate forecasts, always keeping in mind the levels along with the trends. It’s the levels that show how accurate we are. The market’s total actual absolute move was 297% and we have captured 217%. The largest actual move on BETFI was 78%. The average actual move was 29% and we captured 19%. The 73% accuracy for WAVES.ROM is also similar to what we delivered on INDIA (WAVES.INDIA 74%).

Enjoy the latest WAVES.ROM ACCURACY REPORT 2008.

ORPHEUS ROMANIA RESEARCH

WAVES.ROM is a perspective product published on TUESDAY’S and THURSDAY’S. The report highlights Romanian Stock Market top three Equity Indices viz. the top ten blue chip BET Index (.BETI), BET Composite (.BETC), the Financial Index BETFI (.BETFI) and the local currency RON (EURRON=, RON=). The products covers the top ten BET component stocks. (ROMP.BX, SNPP.BX, BATR.BX, BRDX.BX, TSEL.BX, ATBE.BX, BRKU.BX, BIOF.BX, IMPT.BX, TUBU.BX) and all the components of BETFI Financial Index(SIF2.BX, SIF5.BX, SIF3.BX, SIF1.BX, SIF4.BX) are covered in the report. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers. WAVES.ROM, CHANNELS.BVB and CHANNELS.RASDAQ are bundled together as PERSPECTIVE products. Unlike WAVES which focuses more on blue chips, CHANNELS covers all the BVB and RASDAQ stocks.

REUTERS COVERAGE .BETFI, TUBU.BX, TSEL.BX, SNPP.BX, SIF5.BX, SIF4.BX, SIF3.BX, SIF2.BX, SIF1.BX, ROMP.BX, IMPT.BX, BRKU.BX, BRDX.BX, BIOF.BX, BATR.BX, ATBE.BX

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Platinum and Copper

We carried Platinum bottoming view starting Nov 2008 from near 800 levels. We expected prices to hold primary supports. Prices not only held respective levels, but also have pushed 37% higher from 2 Nov lows at 732. And if the momentum signals are to be interpreted correctly, prices could push higher till 1,100 before anything.

A similar MINOR and Intermediate positive scenario exists in Copper. We have RSI momentum over reactivity and overlapping price formations which validate our positive case.

About GOLD. Prices have moved back near psychological 900 levels. Though the form looks impulsive, a clear five up, we are not convinced of an intermediate reversal on GOLD yet. A best case above 900 suggests 940. But first we will wait for a clear break at 900. We will need more than the current ongoing price formation to start looking at the larger up move on Gold till 3000. Even the Gold Spot and Futures in India look topping despite reaching historical highs.

Silver continues to push up as anticipated. Above 11.10 we are looking at 12.57.

Enjoy the latest WAVES.GOLD

WAVES.GOLD is a perspective product published on Monday and Wednesday. The report highlights GOLD and other precious and base metals. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

REUTERS RICS: XAU=, XAG=, XPT=, CU-NYC, .SPGSIZ, SPGSIA, .NSTL

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OIL READY TO REVERSE

The December low we highlighted in WAVES.OIL continues to hold. The price movement was clock work. A 1 up, followed by 2 wave down and now the 3 wave up. (ANTICIPATED and HAPPENED – SLIDE 2). The price structure illustrated on the right is the ongoing 3 up leg, which seems ready to push back up to 50 and higher.

50 is a psychological level and a push back up to 50 is no short of an intermediate reversal in OIL prices. A move up on OIL could push OIL up in higher territory near 70. This should be good news for OIL equity and commodity bulls.

We have other conventional patterns validating our case. There are many potential Head and Shoulder and potential double bottom, which suggest a turn around. The Primary RSI momentum support at RSI 40 on BRT, XLE and CVX also confirm the positive view. We have also illustrated the WTM momentum, which is emerging out of oversold territory.

The only drag in the OIL complex seems to be equity related to commodity. Stock like Reliance (Indian Energy Major) have still overlapping formations, which don’t look too encouraging for a sustained turn around yet.

Enjoy the latest WAVES.OIL

ORPHEUS GLOBAL RESEARCH

WAVES.OIL is a perspective product published once a week. The report covers BRENT, WTM, XLE (Energy SPDR), top energy stocks, Natural Gas and related FUTURES. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTERS RICS: BRT-, WTM-, .XLE , CVX.N, XOM.N, IPNG, NG-P-CAL

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REVISITING MICROSOFT

This is what we said in our 13 OCT 2008 WAVES.GLOBAL update.

“The last few trading weeks has pushed the MICROSOFT over the edge back to Dec 2000 low. Technology is an early economic sector and should underperform most sectors, barring financials and discretionary, which are part of the same early economic cycle sector. We will not be surprised if the stock actually tanks down below psychological 20 to near 14 levels. This is classic A-B-C circle corrective down, whose time seems to have come. Now if Microsoft cracks, most technology sector would see selling pressure. This is why OCT low might need more than a few trading sessions to hit some significant base. And we will not be surprised if OCT low actually stretches till the last week of OCT and maybe further.”

What happened. Prices are now at 17 and nearing our targets (ILLUSTRATED). And the NEWS as usual is catching up. “MICROSFT firing 5000 employees” is all over the news.

About INDICES overall. All of NIKKEI, DOW, DAX, SENSEX, S&P are nearing previous lows (OCT-NOV 2008) and we continue to look at a potential reversal based on our inverted cases we have been highlighting the last two issues.

Enjoy the latest WAVES.GLOBAL

REUTERS RICS: .BVSP, .IRTS, .FCHI, .GDAXI, .GSPC, .DJI, .N225, .SSEC, C.N, JPM.N, BAC.N, AXP.N, AIG.N, DIS.N, HD.N, GM.N, VZ.N, T.N, INTC.OQ, MSFT.OQ, HPQ.N, IBM.N, UTX.N, CAT.N, GE.N, MMM.N, BA.N, KO.N, MCD.N, WMT.N, DD.N, PFE.N, MRK.N, CVX.N, XOM.N, PG.N, JNJ.N, AA.N

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The True Trendline - II

We illustrated the DOW true trendline last time. Both prices and momentum turned against us since then. We have carried a detailed review on the GLOBAL INDICES in this issue regarding our PREFERRED positive view that has held on since NOV lows on DOW and OCT lows on the other global and emerging market indices. Before we come to the fractals and cycles, we relooked at the TRUE TRENDLINE where we left it. Unlike DOW, DAX and SENSEX are still showcasing valid reversal signals with Intermediate RSI turning back from true trendline. This suggests that the TRUE TRENDLINE conventionalism might still be a valid observation. We also have the NIKKEI Intermediate RSI in the over reactive mode suggesting that after the worst performance in 40 years NIKKEI might not have a bad 2009 after all.

Coming to CYCLES and FRACTALS, the KITCHEN CYCLE low beyond Q1-Q2 2009 will make it larger than average. Moreover, the Juglar which started in 1998 is already more than a decade old. This means that CYCLE lows are behind us and prices should find intermediate bottoms soon enough. Above this BEAR markets are rarely linear five wave structures and not always 5-3-5 structures. We are expecting complex combinations (w-x-y) in this secular bear market. We have illustrated a detailed count on the DAX with such a preferred corrective combination.On the intermediate and minor time frame a 4 wave bounce can still not be ruled out before S&P heads lower. China and Nikkei are still above key supports and pushing higher. IRTS Moscow has reached primary 4 circle supports and is supporting an intermediate Key Reversal bar. India and Brazil are still looking for intermediate supports.

Overall we would still give it another week before negating our positive expectations and switching to bear mode.

Enjoy the latest WAVES.GLOBAL

WAVES.GLOBAL - WAVES.GLB is a perspective product published on Monday. The report highlights top GLOBAL indices and emerging market indices viz. Dow Jones Industrial (.DJI), S&P 500 (.GSPC), German DAX (.GDAXI), Russian IRTS (.IRTS), Shanghai Composite (.SSEC), Nikkei 225 (.N225), Brazil BOVESPA (.BVSP), Indian Sensex (.BSESN). The product covers all the DOW 30 stocks. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers and market trends.

REUTERS RICS: .BVSP, .IRTS, .FCHI, .GDAXI, .GSPC, .DJI, .N225, .SSEC, C.N, JPM.N, BAC.N, AXP.N, AIG.N, DIS.N, HD.N, GM.N, VZ.N, T.N, INTC.OQ, MSFT.OQ, HPQ.N, IBM.N, UTX.N, CAT.N, GE.N, MMM.N, BA.N, KO.N, MCD.N, WMT.N, DD.N, PFE.N, MRK.N, CVX.N, XOM.N, PG.N, JNJ.N, AA.N

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THE FUTURE OF RUPEE

WAVES.FOREX introduces the rupee futures today. The recently introduced emerging market currency futures, should see a wide interest, as emerging markets get back into the news. We continue to bet on the FUTURE of RUPEE. The current formation looks like a corrective to us, which should resolve lower at least on the minor time frame. Our PREFERRED view still considers a multi month topping view on most emerging market pairs that we track here, specially EURRON and Indian Rupee.

EURRON also remains at a key juncture as spot prices retest previous highs. EURRON FUTURES however have breached previous highs. This is despite the DAILY KEY REVERSAL bar. We are still looking down on EURRON back to 4.25 levels, a weekly closing above 4.37 will challenge our PREFERRED negative view and force us to look at 4.7 before anything. This at this stage is a low probability scenario.

Market topping is always tricky and catching a top isn’t easy. Top is full of spikes and confusion. A retest of previous high and confusion around current levels do indicate that we are forming a sizeable top. Above this we have historic negative sentiment surrounding the asset class.

Other pairs that we track like EURO DOLLAR continues to head lower. A push below 1.3 pushes the pair back into negative territory validating our intermediate view that it is not yet over for DOLLAR strengthening (THE DOLLAR TRIANGLE). Member’s who study our work on bottoming GOLD will also be able to appreciate intermarket relationships working in favor of an impending leg of DOLLAR strengthening. The report also carries ANTICIPATED and HAPPENED cases on JAPANESE YEN, RON DOLLAR, BRITISH POUND and EURCHF.

Enjoy the latest WAVES.FOREX.

[bold]WAVES.FOREX[/bold] is a perspective product published five days a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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The CNXIT Kitchin

The average 3.3 year KITCHIN cycle defines cyclicality in the economic cycle, assets, stocks and indices. The reason Kitchin assumes more significance in capital markets has also to do with its periodicity. At 3.3 years, most of us who were around in 2000 have witnessed nearly two KITCHIN CYCLES. Only investors who have been in the market since 1998, (if they have survived the ongoing financial crisis) might have the opportunity to live a JUGLAR, a 9-12 year cycle. The Juglar should finish sometime in 2011-2012. We are cycle blind, as a short KITCHIN cycle also seems too large for our investment horizon.

Even from a trading perspective, researchers have highlighted the need to capture larger trades and trends. Brian J. Millard in his book CHANNELS and CYCLES talks about an optimum trading interval as a key to minimizing losers and maximizing winners. As the number of trades made in one year rises, the probability of making a losing trade increases. The ideal trading time back tested by the author is around 2 months, which incidentally is a third of six months, a key periodicity linked with the KITCHIN. We have illustrated the KITCHIN here on CNXIT in continuation of our last week’s article on TECH REVERSAL. The periodicity highlighted are the 6 month cycles, which suggest a reversal on the Index till MAY – JUN 2009. This is in sync with the ENDING DIAGONAL reversal Elliott fractal we highlighted last week.

We have been bearish on TECH for over two years now. And this is what we said in our INDIA OUTLOOK 2007 two years back in JAN 2007. “Technology: Despite the noise that Infosys and Indian Tech gets abroad, the sector has underperformed every other sector in 2006. The underperformance should continue. Technology is a Middle expansion sector and does not do well in late expansion sectors (current). We still believe the technology sector prices should correct sizeably from current levels. We will not be surprised if Technology gives a negative return for 2007.” Now we are betting on a turn here. The illustrated TABLE also suggests a move up in ranks in performance over 6 months, 3 months and 1 month for CNXIT. The index has moved up despite all negative news and a sector leader going bust. A classic proof of relative outperformance. We also have the candle penetration pattern at the primary base.

The latest issue of WAVES.INDIA also carries ANTICIPATED and HAPPENED cases on TISCO, BSEOIL, BSE Health Care, BSE Power and BSEBANK. We continue to look at a turn around on metals and are still looking for more clarity on PREFERRED and ALTERNATE view on NIFTY and SENSEX.

Enjoy the latest WAVES.INDIA

ORPHEUS INDIA RESEARCH

WAVES.IND. is a perspective product published on Monday and Wednesday. The report highlights Indian Stock Market top sectoral Indices and Sensex (BSE 30) viz. BSEOIL, BSESC (Small Cap), BSEMC (Mid Cap), BSEHC (BSE Health Care), BSEPHARMA (Pharmaceuticals), BSECG (Capital Goods), BSEBANK (Banking), CNXIT (Technology), BSEFMCG (FMCG), BSEAUTO (Auto) etc.. The product also covers all the 30 Sensex components. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

Reuters RICS. STOCKS. MAHM.BO, MRTI.BO, LART.BO, TAMO.BO, ACC.BO, ABUJ.BO, GRAS.BO, HDBK.BO, ICBK.BO, SBI.BO, HALC.BO, RLEN.BO, BHEL.BO, HLL.BO, NTPC.BO, SATY.BO, TCS.BO, INFY.BO, WIPR.BO, BJAT.BO, ONGC.BO, RELI.BO, RANB.BO, CIPL.BO, DLF.BO, TISC.BO, ITC.BO, BRTI.BO, RLCM.BO

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The Tech Reversal

The scale really changes when you compare the 1 million people inhabited Cluj County with the 23 million strong Mumbai, but even then a drunkard stopping at the church gate on his way back home is a sight full of inspiration. We have religion, economics, emotion, alcohol, mathematics, patterns and cyclicality.

Humans just like the drunkard take solace by blaming uncertainty on randomness. We wrote about randomness on prior occasion in ‘The Taleb conundrum’. This time we are taking it a step ahead by discussing the TECHOLOGY sector index, which seems to have gone out of favor, as randomness of global markets and news of poor corporate governance emerge.

John F. Ehlers in MESA and Trading Market Cycles discussed how the random walk of a drunkard has a pattern about it, if you consider the random variable as momentum and not the direction which the alcoholic takes. Unlike direction which can be up or down for a price, the time variable instead just moves forward. The random motion of the market hence has a pattern, a fractal, a cycle created by the market as it responds to physical phenomena.

This is why just by picking one end one can create the complete structure. This is why looking at emerging market cues for gauging the direction on DOW works. Underperformers can be studied to understand the direction of performers. Moreover, since performance itself is cyclical, even a blue chip underperforms another sector or stock when the performance cycle turns against it. This is why pairs like LONG CNXIT vs. SHORT NIFTY are not strange strategies. The leading sector of yester years has seen the cycle of love turning against it and the cycles suggests that hate has reached an extreme and the TECH outperformance might be near.

I remember a reader asking us early 2007 “How can Infy become half? What about the earnings?” There were a host of other questions asked to us challenging the ridiculous forecast. One of the Orpheus fresher was recently asked about his work and after expressing surprise at how fractals and cycles can be used to predict, another question asked was “What if you go wrong?” We humans have a fancy about many things. We are loss averse and scared to go wrong. This is the same like asking how a market leader can go bust. Well! there are some questions this generation will not ask again. Maybe the next generation will ask the same question again. But that’s a long time.

Unlike all the activity on NIFTY and other indices, the CNXIT has been stagnating. The formation looks like an ending diagonal to us. A five legged overlapping structure, which is generally seen in final exhausting price structure just before a reversal. What this means is that TECH might be ready for a reversal. This is not a small reversal and could see prices push at least 30% from current levels. This is no mean task considering market is concerned about IT jobs and crisis.

This positive view looks tough to digest when you look at NIFTY, which has slid back to previous lows and is nearing OCT 2008 lows. This is where we move from market patterns to market cycles. The average 3.3 year KITCHIN cycle defines cyclicality in the economic cycle, assets, stocks and indices. The reason Kitchin assumes more significance in capital markets has also to do with its periodicity. At 3.3 years, most of us who were around in 2000 have witnessed nearly two KITCHIN CYCLES. Only investors who have been in the market since 1998, (if they have survived the ongoing financial crisis) might have the opportunity to live three Kitchin cycles also knows as a JUGLAR, a 9-12 year cycle. The current Juglar should finish sometime in 2011-2012. We are cycle blind, as a short KITCHIN cycle seems too large for our investment horizon. The KITCHIN cycle on CNXIT has turned up and should see the first leg up extending till May-Jun 2009 followed by a correction and extending gains till end of the year. This is in sync with the reversal formations we mentioned earlier.

We have been bearish on TECH for over two years now. And this is what we said in our INDIA OUTLOOK 2007 two years back in JAN 2007. “Technology: Despite the noise that Infosys and Indian Tech gets abroad, the sector has underperformed every other sector in 2006. The underperformance should continue. Some sectors take over market leadership at some points in the economic cycle and other sectors underperform in the same points (sector rotation). We still believe the technology sector prices should correct sizably from current levels. We will not be surprised if Technology gives a negative return for 2007.”

Now we are betting on a turn here. CNXIT has also shown a move up in ranks in performance over periods of 6 months, 3 months and 1 month. It has come from a negative of -38.16% over 6 months to a positive move of 3.47% over the last month. The index has moved up despite all negative news and a sector leader going bust, a classic proof of relative outperformance.

Apart from the fact that there is a lot of negative sentiment extremities linked with the sector, the CNXIT has been falling for more than 24 months. Even from an annual cycle perspective, a bounce is due. We should also keep in mind that a sector index is different from a company, a company can go bust, but a sector failure is more in the mind than real. Because as individuals we may perish but as a group we innovate, survive and thrive. To assume a sector failure from current levels is like assuming that the drunkard would never reach home, but then he surprises.

Enjoy the latest WAVES.INDIA

ORPHEUS INDIA RESEARCH

WAVES.IND. is a perspective product published on Monday and Wednesday. The report highlights Indian Stock Market top sectoral Indices and Sensex (BSE 30) viz. BSEOIL, BSESC (Small Cap), BSEMC (Mid Cap), BSEHC (BSE Health Care), BSEPHARMA (Pharmaceuticals), BSECG (Capital Goods), BSEBANK (Banking), CNXIT (Technology), BSEFMCG (FMCG), BSEAUTO (Auto) etc.. The product also covers all the 30 Sensex components. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

Reuters RICS. STOCKS. MAHM.BO, MRTI.BO, LART.BO, TAMO.BO, ACC.BO, ABUJ.BO, GRAS.BO, HDBK.BO, ICBK.BO, SBI.BO, HALC.BO, RLEN.BO, BHEL.BO, HLL.BO, NTPC.BO, SATY.BO, TCS.BO, INFY.BO, WIPR.BO, BJAT.BO, ONGC.BO, RELI.BO, RANB.BO, CIPL.BO, DLF.BO, TISC.BO, ITC.BO, BRTI.BO, RLCM.BO

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GOLD, RUPEE N STEEL

The last time we covered steel was 3 months back on 22 OCT 2008 in ‘What Happened to Steel?’. It was then we talked about the connection of steel with silver. This is what we said.

“A rise on silver against gold could help industrial metals like steel. Based on intermarket pairs, we suggest a bottoming on silver and on steel. And the Oct 2008 low in equities should see some interest in steel stocks. As a rising stock market helps steel prices more than gold. Silver prices have also reached all time historical oversold zones of a decade”.

From 4 Dec when we gave the Long Silver - Short Gold update, Silver has outperformed gold by 7%. This in barely 40 days translates to a 54% annualized spot return. Even steel stock prices e.g. TISCO bottomed five days after our 22 Oct call on bottoming steel. The prices are still above respective lows. Equity is known to outperform it’s underlying commodity and this is one reason we will not be surprised if TISCO takes the lead up (SLIDE 1, 2). The illustrated formation is the inverted TISCO price. The formation seems ready for a reversal. Overreactive momentum also confirms our view of an impending turn around.

Other base metals like Aluminum and related equity majors are also in news. ALCOA’s bad results are all over. But the current prices after all the negative news are still above ALCOA’s price from 24 Dec when we said ‘Alcoa is a screaming BUY’ (SLIDE 5). One should remember, it’s easy screaming SELL after prices collapse 88% from the top. This is also similar to the Zinc story, which the world might consider over. We have illustrated ZINC momentum, which is challenging and leading a breakout (SLIDE 11).

About GOLD…The ‘UP BUT TOPPING’ recommendation panned out as expected. We have carried out the Anticipated and Happened scenarios (SLIDE 6,7). A break below 800 should start the anticipated negativity for GOLD back to 700 and potentially down till 560. The Indian spot (SLIDE 9) also failed back from near historical highs. And what may look like an expanding diagonal on INDIAN gold futures is nothing but falling international gold prices denominated in the Indian Rupee creating the illusion that Indian Gold prices behave differently than international gold (SLIDE 8). The last bout of strengthening on Dollar also might push gold back into our anticipated Q1 2009 lows.

Enjoy the latest WAVES.GOLD

WAVES.GOLD is a perspective product published on Monday and Wednesday. The report highlights GOLD and other precious and base metals. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

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The TRUE Trendline

We have passed nearly two months and an end of the year since our 20 NOV 2008 write up on SELLING THE TROUGH. We agree that move has been choppy and the DOW has not really made much progress, but one thing is clear, you wouldn’t have got much richer selling at DOW 7,550.

The illustrated chart is the DOW with it’s oscillator. While the prices are stagnation the indicator has impulsed up from extreme oversold. The oscillator has moved above 40 and is ready to break true trendline resistance. Momentum is known to lead prices. And if this break here is the trigger for a intermediate (multi week) move up, get ready.

Emerging market indices continue to be positive. Brazil has pushed back into SEP 2008 gaps, Nikkei is up 20% from Oct lows. SSEC Shanghai is in a C/3 up and Indian Sensex and BSE Metals are coming out of Intermediate CYCLE lows.

We still don’t have a sell signal. And even if we had, we won’t stand up against a true trendline impending break.

Enjoy the latest WAVES.GLOBAL

WAVES.GLOBAL - WAVES.GLB is a perspective product published on Monday. The report highlights top GLOBAL indices and emerging market indices viz. Dow Jones Industrial (.DJI), S&P 500 (.GSPC), German DAX (.GDAXI), Russian IRTS (.IRTS), Shanghai Composite (.SSEC), Nikkei 225 (.N225), Brazil BOVESPA (.BVSP), Indian Sensex (.BSESN). The product covers all the DOW 30 stocks. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers and market trends.

REUTERS RICS: .BVSP, .IRTS, .FCHI, .GDAXI, .GSPC, .DJI, .N225, .SSEC, C.N, JPM.N, BAC.N, AXP.N, AIG.N, DIS.N, HD.N, GM.N, VZ.N, T.N, INTC.OQ, MSFT.OQ, HPQ.N, IBM.N, UTX.N, CAT.N, GE.N, MMM.N, BA.N, KO.N, MCD.N, WMT.N, DD.N, PFE.N, MRK.N, CVX.N, XOM.N, PG.N, JNJ.N, AA.N

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