Tradable Patterns

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Arabica Coffee (KC)’s Weekly/Daily/4hr/Hourly Signals Align

Today’s session will be relatively subdued with the US/Canada Labour Day holiday trading hours in effect for select CME markets.

  • CME 2014 Holiday Trading Hours

  • Arabica Coffee (ICE KC Dec14) Weekly/Daily/4hr/Hourly/30min/5min

    KC was closed yesterday so today’s notes are a repeat of yesterday’s. KC is in the late stages of completing its pennant as seen in the 4hr chart. The hourly chart provides a view of a wedge pattern within the pennant. Zooming out into the daily chart, you can see that KC’s in the middle of an upward sloping channel. The weekly, daily and 4hr and hourly RSI, Stochastics and MACD mostly point higher now, providing a high probability long setup. I am eyeing long entry in the 1.99-2.00 range.

    Arabica Coffee (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Silver (CME SI Dec14) Weekly/Daily/4hr/Hourly/30min/5min

    SI has inched lower from yesterday, but continues looking well positioned for a follow through on last week’s rally attempts. I continue to be long at 19.68, and am targeting the 19.9-20 range for a rally ahead of Friday’s non-farm payrolls (NFP). Whether SI succeeds in rallying above my entry price by Friday’s NFP, I will likely close the position just ahead of the release to lower risk.

    Silver (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Wheat (CME ZW Sep14) Weekly/Daily/4hr/Hourly/30min/5min

    ZW has re-opened in today’s Asian session after a day off yesterday due to the US Labour Day. Is is under a bit of pressure on the 4hr and hourly RSI, Stochastics and MACD, and sits in the middle of a channel as seen in the daily chart, making it a tricky long play today.

    Wheat (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Corn (CME ZC Dec14) Weekly/Daily/4hr/Hourly/30min/5min

    Although ZC successfully tested a triple bottom pattern (on the 4hr chart), it remains vulnerable to downside as seen by the daily and 4hr Stochastics and MACD pointing down. Any break below this triple bottom support will likely send ZC to its August low. Downside beyond the August low though should be fairly limited considering how the weekly MACD is about to make a positive crossover.

    Corn (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    VIX (CFE VIX Sep14) Weekly/Daily/4hr/Hourly/30min/5min

    The VIX’s weekly and daily RSI, Stochastics and MACD continue coiling for a pending rally. The 4hr and hourly RSI, Stochastics and MACD however, point slightly lower. I am long at 14 and now looking to exit the VIX before Friday’s NFP. I was initially expecting a rally opportunity to above 14 before Friday, but with many US/Canadian traders still on break from Labour Day, the action might not come until post NFP Friday.

    VIX (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Nasdaq100 (CME NQ Sep14) Weekly/Daily/4hr/Hourly/30min/5min

    The NQ’s trading near the top of a slightly rising channel as seen in my 4hr chart, while the daily Dojis and flattening MACD green line increasingly serve as a warning to those who are still going long at this point. I continue holding my short at 4059.90, but will likely exit the short ahead of NFP Friday, with the intention to re-enter the short assuming it becomes clear the market wants to go lower post NFP.

    Nasdaq100 (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    S&P500 (CME ES Sep14) Weekly/Daily/4hr/Hourly/30min/5min

    The ES is in the middle of a channel as seen in my 4hr chart, and should be fairly limited in further upside given the toppish daily Stochastics and looming negative crossover on the daily MACD. As with my VIX and NQ positions, I am now updating my plan to exit my ES short (initiated at 1990.46) ahead of Friday’s NFP.

    S&P500 (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Netflix (NFLX) Weekly/Daily/4hr/Hourly/30min/5min

    NFLX was closed yesterday so today’s notes are a repeat of yesterday’s. NFLX continues looking vulnerable to downside as it remains close to where it broke beneath the uptrend support line shown in the 4hr chart. Note how the daily MACD is now close to a negative crossover, at which point it would form a lower high versus its high in July.

    Netflix (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Cotton (ICE CT Dec14) Weekly/Daily/4hr/Hourly/30min/5min

    CT re-opened today after yesterday’s ICE US Labour Day holiday. In the Asian session, it now appears that its late Friday rally resumption attempt was premature. The daily and 4hr RSI, Stochastics and MACD mostly point lower. In the daily chart, CT appears vulnerable to a break beneath an ascending triangle support line. CT is following in ZW’s footsteps of rallying hard off of a strongly oversold weekly chart, and will likely also require a month or so of consolidation of those gains (similar to that which we’re currently still seeing with ZW).

    Cotton (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    BUXL (Eurex GBX Sep14) Weekly/Daily/4hr/Hourly/30min/5min

    The GBX is almost at its all-time April 2012 high. After yesterday’s slight pullback, its weekly MACD histogram stopped rising and began falling for the first time in the current histogram rally. A few more drops in the weekly MACD histogram should begin to level off the weekly MACD lines and coincide with the weekly RSI and Stochastics rolling over. I’m targeting this rolling over and the short opportunity to emerge in the next two weeks.

    Buxl (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Gold (CME GC Dec14) Weekly/Daily/4hr/Hourly/30min/5min

    As expected, GC broke beneath its channel support (as seen in the 4hr chart), and appears to want to head lower as seen by its failure to reach the top of the channel in the daily chart, and by the daily RSI and Stochastics which both point lower. We are beginning to see SI outperform GC, which I expect to gather steam in the next few months.

    Gold (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Tesla (TSLA) Weekly/Daily/4hr/Hourly/30min/5min

    TSLA was closed yesterday so today’s notes are a repeat of yesterday’s. TSLA continues being a bit further off than NFLX in putting in a double top. Its daily and 4hr RSI, Stochastics and NACD are mostly tiring, which should continue to caution potential longs. I’ll need to see the daily RSI and Stochastics turning down (and preferably the weekly RSI, Stochastics and MACD flattening) before I consider shorting TSLA.

    Tesla (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Natural Gas (CME NG Oct14) Weekly/Daily/4hr/Hourly/30min/5min

    Channel resistance as seen in the daily chart has held, with NG seeing profittaking on last week’s rally. The daily and 4hr RSI, Stochastics and MACD are mostly rolling over.

    Natural Gas (Wkly/Dly/4hr/Hrly/30min/5min) Charts

    Note the daily reshuffling of the charts. As mentioned, they’re ordered by how favourable the risk:reward of the trade idea appears based on my analysis for each day.

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