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. He is a special consultant to AxiCorp.
Drawing accurate trend lines lies at the heart of chart analysis. It looks easy but accurate trend line placement is more difficult than it appears at first glance. Accurate trend line placement, based on well-defined rules is the foundation of more complex analysis techniques. It is also the foundation of stop loss and risk management
The long-term fundamental factors like talk of a technical default in the U.S., a weakening Dow index and insipid economy, which have contributed to US dollar weakness, have not disappeared, so long-term downward pressure remains.
The Nasdaq China Index is moving towards the upper edge of the historical trading band near 190. This is a well-defined support level. Aggressive traders will look for a rebound development from this level.
The Euro/Dollar is at a significant point with the potential to prove the placement of trend line B and thus signal a continuation of the up trend. Failure of support at trend line B signals a change in the trend and a move towards $1.29.
An earlier call on the dollar has not been realized so it is time to take a fresh look at the charts on the greenback, Daryl Guppy says.
The charts show that euro-yen enters a variation of a double-bottom pattern used to set a new long-term upside target.
Why does the Shanghai market rise and fall so rapidly?