Asia-Pacific Markets Charting Asia with Daryl Guppy

More

  Tuesday, 3 May 2016 | 10:10 PM ET

Charts show gold going to $1,340 and fast. Here's the signs to watch for

Posted ByDaryl Guppy

There are three key features to look out for in this breakout in the gold price, which also happens to confirm our analysis back in February.

The first and most important feature on this chart is the breakout from the fan trend line pattern.

The second feature is the breakout confirmation from the Guppy Multiple Moving Average (GMMA) relationships; the long-term group has compressed and turned decisively upwards.

The third feature is the way price has remained above the critical resistance level near $1,200, using it instead as support point.

Gold is a proxy for the entire commodity complex and we see this behavior reflected in oil and silver charts.

The upside target for gold is now the historical resistance level near $1,340. This is the short-term target and the fan trend line breakout behavior suggests it could be hit quickly.

»Read more
  Monday, 25 Apr 2016 | 10:38 PM ET

Here's how to trade the Dow's ranges

Posted ByDaryl Guppy
Dow Jones sign
Scott Mlyn | CNBC

The Dow Jones industrial average offers rally-and-retreat trading opportunities between 16,000 points and 18,290, chart analysis shows.

Between March and May 2015 the DOW hit resistance near 18,290, developing a shallow rounding top pattern before plummeting in August.

The retreat then reached the rounding top pattern target near 16,000 and stabilized in this area, before a rally in October reached 18,000. It then retreated again, retesting the support level near 16,000.

This rally-and-retreat behavior has created a broad trading band between 16,000 and 18,290, which in turn sets up three different development scenarios for the Dow.

»Read more
  Wednesday, 20 Apr 2016 | 12:56 AM ET

Oil above $38 a rally, not a trend change

Posted ByDaryl Guppy
An oil pump jack in Russia
Sergei Karpukhin | Reuters
An oil pump jack in Russia

The OPEC meeting confirmed that the era of cheap oil has not come to an end.

Chart analysis of the Nymex oil chart in March suggested the rise in the oil price from $28 was a rally and not a trend change. The strong rally gain was a gift to traders but it was not enough to revitalize the oil industry because the rally faced significant resistance barriers.

However, oil is establishing a pattern of longer-term trend reversal with price oscillation around the $38 level. Price activity at this level will be the most significant factor in oil behavior in the next few weeks. If the price remains near to the $38 level, the longer-term outlook for oil is bullish.

If price falls below $38, the next support level is near $28.

»Read more
  Monday, 11 Apr 2016 | 10:58 PM ET

Chart: Strong chance of a rally in Chinese stocks

Posted ByDaryl Guppy
62616957
Dan Kitwood | Getty Images

The Shanghai Index has developed a strong breakout above the resistance level near 3000 with a upside target near 3400. The short-term group of averages in the Guppy Multiple Moving Average (GMMA) indicator has moved above the upper edge of the long-term GMMA.

This is bullish. A strong uptrend breakout is signaled when the lower edge of the short-term GMMA moves above the upper edge of the long-term GMMA.

The long-term GMMA degree of compression has shrunk to 39 index points compared with 69 index points last week. This shows investors are increasingly more confident about the sustainability of the new uptrend. This increasing rate of compression in the long-term GMMA means a strong rally has more chance to develop because investors are more confident and they will also participate in the rally. This combination of factors helps to accelerate the trend change.

The classic GMMA pattern of bullish test and re-test behavior is often associated with the change from a downtrend to a new uptrend. There are four parts in this Shanghai Index pattern .

»Read more
  Monday, 4 Apr 2016 | 11:34 PM ET

Chart: Don't expect a euro-yen rally

Posted ByDaryl Guppy
An image of Euro banknotes being counted. The central bank policies have hit bank profitability in both regions and German banks have been vocal in criticizing Mario Draghi, ECB president, accusing him of punishing savers and undermining their business models.
Leonhard Foeger | Reuters
An image of Euro banknotes being counted. The central bank policies have hit bank profitability in both regions and German banks have been vocal in criticizing Mario Draghi, ECB president, accusing him of punishing savers and undermining their business models.

The euro-yen pair looks set to continue its steady downtrend, with only a small likelihood of a rally and a longer-term target near 120.

The pair is using the long-term downtrend line as a support level. Rally rebounds face well-established resistance levels created by a legacy of trading bands.

The euro-yen moves between these trading bands, using them alternatively as support and resistance levels; the 127 level is a key support level and is now acting as a resistance level, which the pair is currently testing.

A breakout above the 127 level is a low probability, but if it does develop, then the upside target is near 132.

»Read more
  Monday, 28 Mar 2016 | 9:43 PM ET

Chart: Copper in slow recovery

Posted ByDaryl Guppy
Copper wire. The commodity was trading at five-year lows Wednesday.
Muriel de Seze | Photodisc | Getty Images
Copper wire. The commodity was trading at five-year lows Wednesday.

The health of the price of copper, shown here in cents per pound on the weekly chart, is a guide to the health of the world economy. The weekly copper chart suggests world economic health is beginning to improve but it's too early for a celebration.

The price of copper has a long history of testing, and then retreating away from the upper edge of the long-term group of moving averages in the Guppy Multiple Moving Average (GMMA) indicator.

So what is different this time with the price testing the upper edge of the long-term GMMA?

The first difference is that the long-term downside target price for copper has been achieved. The dominant feature on the chart was the equilateral triangle pattern. The downtrend trend line in the pattern started in September 2011. The uptrend line started October 2011. The height of the pattern is measured at the base. This value is then projected downwards from where price moved below the uptrend line in March 2013.

This gives a downside target of 250 cents and this target was achieved and exceeded. The 250 cents level is now a significant resistance level. A close above this level is very bullish.

The second and most important difference is the behavior of the long-term group of averages on the weekly chart. The long term GMMA became widely separated in December 2015. The recent price rally from 195 cents to 230 cents has caused a significant compression in the long-term GMMA.

The degree of separation remains wide, but the compression behavior is quite strong. This suggests a significant change in the way investors are thinking about future economic growth and the future price of copper

»Read more

About Charting Asia

  • Daryl Guppy is an independent technical analyst who appears frequently on CNBC Asia. He runs training, analysis and resource workshops for retail and professional financial market traders involved in stocks, CFDs, warrants, derivatives, futures and commodities in China, Malaysia, Singapore and Australia. He has his own trading company, guppytraders.com.

 

  • Daryl Guppy is an independent technical analyst who appears frequently on CNBC Asia.