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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: tyc:> who wrote (98659)	11/12/2007 12:17:05 PM
From: pocotrader	Read Replies (1) \| Respond to of 312311

Fellow on BNN said the Cnd, Aus and Nz dollars went down because of carry trade wind ups. poco

To: tyc:> who wrote (98659)	11/12/2007 12:44:12 PM
From: Canuck Dave	Read Replies (1) \| Respond to of 312311

Just online. Figured today would be "whacking day". And it is. Dollar was overbought. Actually, lots of stuff were overbought. I think the loonie may retreat for a while longer. The Cdn dollar trend is pretty strong. Going to take a lot longer pull back to break it. Determining a trend change is aided if you have volume figures, i.e. did it hit a major resistance or just some intermediate blip and profit taking within a major underlying trend. Lacking volume data, it's a lot trickier. I guess at this point, it depends on your time frame. Short term, probably the wrong time to get out of the loonie now. Long term, Canadian economy is in much better shape than US. So... I think the overall trend is still in place unless the government deliberately starts to weaken the currency, but we've entered a consolidation phase. Dollar is going to bounce around the $1.00-$1.10 level for a while. Might take a year or more for the trend to reassert. CD

To: tyc:> who wrote (98659)	1/12/2008 11:58:38 AM
From: Mario :-)	Read Replies (3) \| Respond to of 312311

<< How would you decide whether a new trend has been established, please ? >> In a nutshell, watch for a trend line break, confirmed with lower low (for a down trend) or higher high (for a uptrend) More detailed: I rather use weekly chart. While a little slower, it has less noise. Generally, you are looking at few things: For changing trend from Up to Down - was there topping pattern or some divergences? (not that is necessary but helps as first red flag) :) - price couldn't make new high - price breaks trend line - price makes new low - confirmation of trend change. At this point you can draw new (declining) trend line connecting last two tops (second is lower)... But it's not as easy as I described, because many times you get consolidation period - range bound and there is no clear trend. Well maybe sideway trend <vbg> OK, lets use chart: It is not important what happened first, no new high, or breaking trend line. As you can see from the chart, we got lower high and we got breaking trend line. Now all we need is new low for confirmation and we are close. New low will probably close candle below red 40 week moving average (40 week = 200 days). Many will see this as additional bearish sign. You can also see there was consolidation period from June 07 to Sept 07 at around 95. This may give support, maybe bounce point... Lets look at another chart, Crude Oil: Look at middle 2006: We got new high, so no sign of trend change there. (but indicators were diverging) But then we got trend line break. Next, we got lower low in September, that's did it! Next high was way lower in December. Now you have lower low and you can place new (declining) trend line. (red on the chart) This trend line was violated start of Feb 07 and change of trend was confirmed with higher high in April 07 Now we got all set for new trend change: 1 - topping pattern (double top and negative divergences with indicators - first red flag 2 - we are at breaking trend line 3 - if trend line gets violated final confirmation would be close below 85 - to take out last low. Of course, new high would change everything :-) While charts give as higher probability as of what may happen, market will have final word... Btw, did I mention fake break outs? <vbg>