Commodity ETFs uncertain ahead of presidential election

INTERMEDIATE TERM SIGNALS & MARKET ANALYSIS

CurrencyShares Euro Trust (FXE):
10/19/2012 Closing Price: 129.32
INTERMEDIATE TERM (I.T.) SIGNAL
:
Intermediate Term Trend is bullish.
Current Position: LONG @ 128.87 on 10/08/12. STOP @ 127.72
Upcoming Break-Even Price: 132.20; Cover 10,000 (20%)
Current Upside Targets = 132.20
Projected Weekly Range: 1.75
Trading 50,000 Shares; COVERED 10,000 (20%) @ 130.30
I.T. ANALYSIS:

  • FXE total trade profits since 07/25/2012 equal $457,800 or 0.92%.
  • Initial trade risk was $71,000 or .14%. Current trade risk is $31,700. Current trade profits are $32,300 or .06%.
  • FXE seeks to track the movement of the Euro currency.
  • The most recent trade entry risked only $71,000 or 0.14% of our core position on 50,000 shares. This risk has been further reduced by covering 10,000 shares at our break-even price of 130.30. If this week trades higher and closes above its midrange, the new exit price will be at our entry price, guaranteeing a profitable trade. Last week gap higher opened on Tuesday and Wednesday, making new monthly highs, and then sold off on Thursday and Friday. Price action was bullish and slightly divergent by closing seventeen cents below the weekly midrange. We stand by our upside price target of 132.20 and believe it should be achieved within three weeks.

IShares MSCI Emerging Markets Index (EEM):
10/19/2012 Closing Price: 41.50
INTERMEDIATE TERM (I.T.) SIGNAL:

Intermediate Term Trend is bullish.
Current Position: FLAT
Current Upside Target = 48.19 – 49.23
Projected Weekly Range: 0.92
Trading 135,000 Shares
I.T. ANALYSIS:

  • EEM total trade losses since 07/25/2012 equal $7,560 or 0.02%.
  • EEM seeks to replicate the performance of the MSCI Emerging Markets Index by investing in the underlying international securities.
  • Last week rallied strong early in the week, only to fall back down and close near the weekly low. Price action was bullish divergent, with much higher weekly trading yet still closing below the midrange. EEM has been very choppy the previous five weeks, reversing directions for the fifth week in a row, sending mixed signals for upcoming trading. Still within the very bullish weekly range ending 09/14/12, EEM has completely failed to move in a clear direction. The indecisiveness of the emerging markets remains the primary reason for maintaining our flat position.

SPDR S&P 500 (SPY):
10/19/2012 Closing Price: 143.39
INTERMEDIATE TERM (I.T.) SIGNAL
:
Intermediate Term Trend is bullish.
Current Position: FLAT
Current Upside Targets: 154.21 – 159.39
Projected Weekly Range: 3.46
Trading 39,000 Shares
I.T. ANALYSIS:

  • SPY total trade profits since 07/25/2012 equal $71,799 or 0.14%.
  • SPY seeks to track the movement of the S&P 500 Index.
  • Although the previous week’s price action indicated last week’s trading would be definitively lower, the indecisiveness of equity markets has maintained the sideways trend. Price action was bullish divergent, rallying strong on Monday, Tuesday and Wednesday, then plummeting on Friday. Thursday formed an OVB to Wednesday’s trading range, violating the high then correcting down below its low. This formation indicates the direction of the following bar’s trading, in this case, Friday’s bearish sell-off. Price action and weekly closing strength indicates trading should be lower this week, yet investor uncertainty leads us believing the nondirectional trading will continue. Over the last ten weeks, ETF analysis and trading has resulted in $1,646,989 (3.29%) in total profits, $1,213,399 of which is closed and locked-in.
About the Author
Jim Parrish, Kris Hicks and Robert Calhoun

Parrish Hicks Capital Research is a trading and technical analysis firm that specializes in Energy and Metal commodity futures. The two founders, Jim Parrish and Kris Hicks, have a combined 38 years’ experience in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October. They also called the all-time high day for Gold on September 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012.  Their trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. Their expertise is focused on 16 commodities plus the comparable ETF markets. You can reach them at Jim@ParrishHicks.com and Kris@ParrishHicks.com or at www.ParrishHicks.com.

IMPORTANT DISCLOSURE

Transactions in ETF (Exchange Traded Funds) carry a high degree of risk. This material is not intended as an offer or solicitation for the purchase of any financial instrument. The data and these comments are provided for information purposes only and may or may not be intended to be used for specific trading strategies. ETF trading is risky and Parrish Hicks Capital Research assumes no liability for the use of any information contained herein. Any examples are strictly hypothetical and no representation is being made that any person will or is likely to achieve profits or losses similar to those examples. ETF strategies mentioned herein may not be suitable for all investors. The opinions and recommendations herein do not take into account individual client circumstances, objectives or needs and are not intended as recommendations of a particular ETF or ETF strategies to a particular client. The recipient of this report must make his own independent decisions regarding any ETF instrument to a particular client.

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