Hawkeye Volume shows the low interest rate party is over

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Hawkeye Volume shows the low interest rate party is over

The party is unwinding on low interest rates so get ready for inflation. Who knows when, but it’s in the pipeline — it’s just a matter of time, so lock in these low rates asap.

On the daily chart

The cyan arrow shows a double bottom (yellow Hawkeye pivot dots on the price) which indicates the market is oversold, so a rally here offers a great opportunity to get short.

bonds daily

On the weekly chart

Downtrend on declining volume again showing a small rally will occur here.

Markets don’t go down on low volume, they either go into congestion or it is the start of accumulation for an up-move.

US Treasury Bonds

On the monthly chart

This is telling the story, after a rally lasting from 2008 the party is over. Look at the red down arrow. All Hawkeye indicators are short:  red monthly selling volume, red trend dot down and solid red Heatmap showing all trends are to the short side.

US Treasury Bonds

The Hawkeye Perspective

Brace yourself; low interest rates are over. It will take some months to come to an end. Any rally to the upside is a great opportunity to get short. But protect you and your family; this could be a huge trade so immerse yourself and study Hawkeye Volume — the only non-lagged indicator.

How to trade Google stock with little risk.

Less than three months after it hit $800, Google ($GOOG) topped $900, and is now on the brink of becoming the first tech stock to hit $1,000 a share. And with a slew of product launches in the works, the company’s reputation is getting a boost as well. Though we’re not ready for the risk of getting behind the wheel of their driverless car, we’ve got some low risk trades to reveal.

Trade of the Week
Google stock was extremely profitable when trading the shorter (daily) timeframe, only in the direction of the long term (monthly/weekly) – and with little downside risk.

Hawkeye has been long since October 2010! As you can see by the cyan arrow on the monthly chart.

The Hawkeye tools have shown a low risk long on GOOG since October 2010!
The Hawkeye tools have shown a low risk long on GOOG since October 2010!

The Hawkeye Perspective
Only take longs on your chosen faster timeframe (daily or weekly) when the price goes against the monthly then returns in the same price direction.

The cyan arrows on both the weekly and daily charts indicate when to enter with a minimum amount of risk.

Want to learn more while you watch Hawkeye live in action? Sign up for our FREE Live Training Room. What have you got to lose?

Don’t fall for the Apple hype… yet.

If you’re fueled by high expectations of Apple stock, Hawkeye is here to deflate the Apple-hype balloon.

While the iPhone maker has seldom reported negative figures in a decade, this week, Apple revealed typical congestion and a pause in downtrend.

For there to be a new weekly uptrend, the stock would have to break above $466. Refer to the following chart for the continued discussion:

$AAPL monthy chart shows narrow bars on low volume - an indication of accumulation.
$AAPL monthy chart shows narrow bars on low volume – an indication of accumulation.

Point 1
On this particular day, the daily shows declining volume which translates to stopping volume in the existing weekly and monthly downtrend.

Also, the daily trend dot is rolling over showing lack of momentum.

Point 2
The weekly trend does not show advancing volume, therefore negating a probable uptrend.

Point 3
The monthly chart shows narrow bars on low volume; this normally indicates accumulation which will manifest on the faster timeframes as it develops.

In conclusion, there is too much risk to take a new long till increased buying volume occurs on the weekly chart.

Wait for a low risk entry when the daily and weekly indicate a new uptrend or short when the daily resumes in the direction of the weekly and monthly trend, both low-risk entries.

Three smart ways to exit a trade.

Do you stay with your profitable trades as long as possible hoping for the trend to continue to make your profits even larger? Do you tense up when you have to exit a profitable trade?

Here are three exit strategies to help you exit your trades with ease:

  1. Stops (waiting till the Hawkeye stop is touched or crash barrier breached)
  2. Levels ATR (average true range)
  3. Grabba (for fixed profit targets)

Where to exit is more important than where to enter, but the majority of traders in my experience don’t pay enough attention to exits as they should. Hawkeye Traders has not only developed precise entry methods, but also unique and well defined exit strategies.

AAPL weekly Chart with ATR Levels
Chart 1: $AAPL weekly chart showing ATR Levels management rules.

Using the Hawkeye Levels ATR on weekly stocks are phenomenal. Here are the indicator settings used for Chart 1: set the look back period to 14 and the ATR profit and stop factor to 1.5. The rules are that once the bar has closed above (if long) or below (if short) any level, the exit is a close, NOT TOUCH, of the previous level, or a touch of 2 levels back. This covers sudden reversals, so as Chart 1 illustrates, there was no time following a close below any level where there was a corresponding close above the previous level or a touch of 2 levels back. But now at the point labeled “1”, we have price trying to close above level 5, after closing below level 6… if at the end of this week it does close above level 5, the exit would have taken 5 ATR out of the market.

$AAPL weekly chart 2
Chart 2: $AAPL weekly chart showing Levels ATR management rules.

In Chart 2, I show a “losing” trade… but it demonstrates 2 methods to exit.  The first exit method you can see at the point labeled “1”, where there is a close under the zero line (the entry point) after previously closing above level 1. The second exit method is the Hawkeye stop… you could have exited the trade when price closed below the “+” mark 2 bars back from point 1. But please note it was nearly a scratch trade… the Hawkeye methodology protected you at either exit point you could have selected.

Intraday $ES tick chart
Chart 3: Intraday $ES tick chart showing Hawkeye Levels ATR management.

For intraday $ES trading (Chart 3), I set my Levels ATR to a period of 14 and a profit/stop factor of 1.25. See how this enabled you to take 3 ATRs from this move, as it closed above level 4, then closed below level 3, as shown at the point labeled “1” Chart 3.

$ES intraday tick chart with Hawkeye Grabba
Chart 4: $ES intraday tick chart using the Hawkeye Grabba trade management rules.

Using the Hawkeye Grabba allows you to set the levels at fixed price points. For example, say you want levels at every 1 point on the $ES (Chart 4)… so the Grabba settings are 4 ticks ($ES moves in .25 so 4 = 1 full point), and I set the stop multiplier to 1.25 (exactly the same rules as Levels ATR). To exit, follow the same exit rules described for the Levels ATR, or exit at predetermined profit levels as your trading plan dictates. Like the Levels ATR, the Grabba graphically shows you profit targets and exit levels for your specific exit strategy.

While there is no perfect exit strategy, the Hawkeye Method enables you to exit in strength and reduce the risk that the trade will turn against you if you are in a winning position.

Catch the bigger part of the trend with the Hawkeye Levels ATR, or the Hawkeye Grabba!

Duke energy continues in bearish tone on daily chart

day trading stock chart for Duke Energy using hawkeye indicators
Duke Energy – daily chart using Hawkeye

Duke energy shares continued to move lower on Friday, closing the US trading session at $64.78, and adding further pressure to the move lower. The sell off in the stock was given additional momentum following the news that one of Duke Energies subsidiary companies in Florida, Progress Energy Florida, has recently filed requests to reduce customer bills which if approved would see the average household utility bill fall by approximately 6% from the first billing cycle in the new year.

From a technical perspective, Hawkeye delivered an early entry signal to the short side, with a conservative trend Roadkill signal on the 21st August with the stock trading at $66.87, as it finally broke below a short term area of price congestion. Since then both the volume on the daily chart and the 3 day chart have remained firmly bearish, although it is important to note that the daily volumes are light. However this could merely be reflecting the summer period, and a general lack of volumes in all markets, as with the US labor day now ahead we can expect to see a return to more normal volumes as traders return from their summer holidays.

With a red Heatmap and red trend in both timeframes, the stock now looks set to break lower, and indeed on Friday Hawkeye delivered a further confirming signal with a volume Roadkill re-entry signal, suggesting that the current bearish trend has some way to go. The key level now is defined by the Hawkeye pivot in the $64 region, and if this is breached, then we can expect to see this stock move lower to test the $62 – $63 level in due course.

If you would like to see Hawkeye in action, simply click the link below to join one of our Free Live Training Rooms where we trade using the full suite of tools and indicators across all the markets.

Apple stock fails to rise following victory over Samsung

Apple on the daily chart
Apple ($APPL) – daily chart using Hawkeye

Apple’s recent patent victory over Samsung appears to have little impact on its share price, which hit a high of $680 on Monday before ending the week lower at $665.24.

This temporary pullback was signaled on the daily chart with two Hawkeye isolated pivot highs, the first on Monday and the second on Wednesday with the share price moving lower as a result. Despite this, however, the overall picture for Apple remains bullish with the chart displaying a bright green Heatmap and a green Trend on the daily and three day chart.

However, it is important to note that over the last two weeks we have seen volume on the daily chart declining and, in addition, this has also appeared as no demand volume, i.e. white, perhaps giving us an early warning signal of a potential reversal for the stock. Indeed on Friday, on the daily chart, we also saw selling volume appearing for the first time since early August adding further weight to this view. This pullback may be only temporary in the longer term bullish trend, but once again Hawkeye is giving an early warning signal of a possible reversal for the stock in due course.

If you would like to see Hawkeye in action, simply click the link below to join one of our Free Live Training Rooms where we trade using the full suite of tools and indicators across all the markets.

Citigroup shares continue to grind higher

daily stock chart for citigroup on the us stock markets
Citigroup ( $C ) – daily stock chart

Despite the recent bullish momentum in equity markets in general, Citigroup shares have remained relatively flat over the last few weeks, and closed Friday’s US trading session at $29.71 having traded in a narrow range for much of the day. The price is now consolidating into a pennant formation on the daily chart, with the Hawkeye pivots once again defining the congestion area, with both pivot highs and pivot lows in much the same way as in early August, which duly saw the stock break out from a narrow trading range.

Despite the flattening of the Hawkeye trend dots on the daily chart, the three day trend continues to remain firmly bullish supported by strongly bullish volume, and a bright green Heatmap, all suggesting a breakout to the upside is imminent. The price action in the current area is also significant with a series of higher lows over the last few days, suggesting that we should see the stock break higher in due course. With the strong platform of support in the $28 price area, this should provide a springboard for a move higher for the stock in due course with a test of the resistance in the $32.50 region now looking likely as volumes increase following the end of the summer holiday period.

If you would like to see Hawkeye in action, simply click the link below to join one of our Free Live Training Rooms where we trade using the full suite of tools and indicators across all the markets.

 

This Week’s Market Forecast – Risk On Returns!

Last week was the worst Thanksgiving week on Wall Street since 1941. Traders and investors reeled from the problems in Europe, as well as the collapse of the US budget deficit talks. The S&P 500 fell almost 5% on the week, closing just below the key 1160 level. The Dow was also down almost 5% over the week, and the Nasdaq was down by 5.1%.

The selloff really took place following the disastrous German bond auction which saw demand for the 10 year Bund at its lowest since the euro was created. Investors rushed to safety but redefined safety to exclude Bunds, moving instead into US Treasuries, UK Gilts, and Nordic Bonds.

With investors shunning German Bunds, the euro duly collapsed, particularly against the US dollar as the EURUSD tested the 1.32 level before moving back higher. As one commentator has said, this now appears to be the “apocalypse” trade – if German bonds cannot attract investors, and are no longer considered a safe haven, surely it’s now all over for the euro?

As always, nothing is quite as it seems and this may be a hasty conclusion – at least for this week!! The German 10 year bond auction may have gone badly but short dated German debt, known as Bubills, have never been in such high demand even with yields turning negative. In other words, if investors are willing to PAY to lend to the German government, it is hardly a sign of deep fear about Germany or even the euro.

Germany is not under threat – yet – but traders and investors are increasingly trading the euro and Germany together. Since September, the value of the euro against the US dollar has moved almost inversely to German credit default swaps. For those of you who may not know, a credit default swap is a measure of how likely a country is to default on its debt. In other words, traders and investors now care far more about whether they will get their money back than how much they can earn. This also makes them super-sensitive to any hint of danger which leads to much greater market volatility.

The start to this week’s trading has seen the market determined to shake off last week’s doom and gloom by seizing on record Black Friday retail sales and reports that French officials are pushing for a deal on Eurozone fiscal union. This has helped to reverse some of last week’s heavy losses with the US markets having their best days so far in November, with the S&P moving almost 3% higher, while on Monday all the DOW 30 stocks ended higher too.

It remains to be seen whether this swing higher will be maintained, not least because the $VIX – although managed to close lower on Monday – which is positive for equities, is still above 30. If the $VIX does manage to breakdown and move back towards the mid-20s then we could see a rally moving forward into December.

What is also interesting is that according to the latest CFTC data, net euro shorts have also fallen to 85k from last week’s 100k plus. In other words, we could be seeing a short term bounce higher for markets and even the start of a “Santa Claus” rally.

However, with this week’s fundamental news focusing on employment with the non-farm payroll (NFP) release, due on Friday, traders and investors need to take care. The first big number traders (and investors) should watch is the ADP release on Wednesday, a precursor to the NFP. Over a few months this once reliable release, which is based on payroll figures, has become a little less accurate in forecasting the NFP data two days later. Previously, it had always given traders a “heads up” on the Friday data but recently has become increasingly inaccurate in these volatile markets.

Wednesday’s forecast is for a number at 131k, up slightly from last month’s 110k. This is followed by Canadian GDP which is forecast to come in flat at 0.3%.

Thursday’s big number comes from China with the PMI, which is forecast to show a decline from last month’s 50.4 down to 49.8. So expect to see this reflected overnight in the Asian trading session should this number come in wildly at the odds with the forecast.

Thursday sees the unemployment figures in the US, which are forecast to come in flat but we also have the ISM data – an equivalent of the Chinese PMI. Traders and investors watch the ISM as it is considered a leading indicator of the economy because it is based on a large survey of purchasing managers of major companies. Any number above 50 indicates an economy that is expanding and below 50 suggests an economy that is contracting – so this is a very important number.

The week ends, of course, with the general razzamatazz of the NFP – a release which will affect all markets. The forecast is for an increase from 80k last time to 119k this time. This release always causes markets to over-react and traders should wait for any volatility to die down before entering any trade.

Hawkeye users can, of course, trade these markets with confidence because Hawkeye has been designed:

  1. To give traders the edge needed to succeed, as it gets them onto the right side of the market time and time again.
  2. To help traders control their emotions by giving them the confidence to stay in.
  3. To help traders control their risk by giving them clear signals of when to stay in and when to get out, thereby protecting your equity.

All of these things are vital in difficult and turbulent markets such as these! But how is Hawkeye able to do this?

Because Hawkeye has been created to exploit the power of the only leading indicator that traders and investors need, which is VOLUME. This is the foundation stone of Hawkeye on which all the indicators are built. So regardless of whether you are a day trader, position trader, swing trader, scalper, or any other kind of trader, VOLUME should lie at the heart of your trading.

As an example of why volume is such a powerful indicator, Nigel was discussing the gold price in Friday’s trading room. As many of you know, gold has recently had a significant pullback with many questioning whether the recent bull run has now ended for the precious metal.

Indeed in last week’s trading room, the monthly chart was showing some significant resistance as the volume has started to change from green to white (or neutral). In addition, the Hawkeye Heatmap on the weekly chart is also turning dark red – all signals suggesting we can expect to see a further pullback for gold. The daily chart also confirms this view with the short term trend now also turning red, selling volume clearly evident over the last week and any break and hold below the $1600 per ounce level could see a further decline for the metal in due course.

If you would like to see Hawkeye in action and how we use these tools ourselves, then simply sign up for one of the FREE Live Training Rooms! Become the trader you deserve to be!

Nigel Hawkes’ training room covers the commodity markets, where he explains his latest trades and how to select low risk, high probability trades before moving onto the day trader’s favorite instrument – the e-mini. Here you will be able to see the genius that is Hawkeye as Nigel uses the Hawkeye GearBox and GearChanger, two unique indicators to Hawkeye, which ensure we trade at the right speed and in harmony with the market.

To register for our Free Live Training Room each Thursday, Register Here! Forex begins at 8:00am, and Futures/Equities begins at 9:30am, Eastern US time.

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