Here are the charts of Dubai Financial Market Index as well as Kuwait Stock Market Index. I prepared the analysis of Dubai Markets before the news as you can see from the date on top. Both charts are posted here just to illustrate the usefulness of elliott wave analysis of stock markets even if one is considering an emerging market such as Kuwait. Enjoy!
The 50-point down move that happened from 88.48 to 87.97 is hardly a consolation when considering the 279 point move that followed. I hope you moved your stop to break even as advised, but even if you had not done that, your loss should have been no more than 20-25 points. In case you had not placed your stop at the recommended level, you have learned a valuable lesson from Friday’s move. That lesson is no one can be sure of the future. We can assign probabilities for a certain move happening, but one should ALWAYS take precautions in case the market does something differently. My personal experience over the years is when I get stopped, the move will usually go spectacularly in the opposite direction. This is actually a good thing, because (a) it keeps me in the direction of the trend for longer than most others and (b) when I get stopped, it is much easier to make back the loss because of the distance the opposite move will travel. Finally, if you are trading regularly based on my ideas, you should be very strict about my recommended stops, because those stops are often placed just above market pivot points. Good luck and speak to you tomorrow. Ramki
Has USDYEN bottomed?
Morgan Stanley has just issued a research note saying there are several reasons why they think the USD/YEN has already bottomed. They are recommending to buy the currency pair with a stop at 84.50 and they think we will see 101 over the next 12 months.
I think we will probably get much better levels to buy than the current 87.85 level. In most markets, we should look for at least two tests of the bottom before the bears give up. Thus, I urge investors to be cautious. In the short term, ie in the next 12 hours, if we get a move in the USD/YEN to 88.40 plus area, we should actually consider selling the currency. A close stop will be at 88.65, which you can lower to break even once you see a 50 point move in your favor. There is additional resistance at 88.90, but let us see what happens between 88.35 and 88.60 first.
Hello folks!
Just to let you know that I am back in office, and still catching up with a lot of pending stuff. A lot of things have happened in the financial markets during my absense, especially in the last few days. Naturally, we will have to look at every market, and its related charts afresh. This we will do, although gradually. For today, I have read an interesting report from Morgan Stanley about USD/YEN, and hence that will be the first instrument we will deal with.
Talk to you later. (To those who posted comments, my thanks and aplogies for the delayed response).
Regards
Ramki
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