Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

Gold Showing EMA Compression with Targets

Sat, Feb 9, 1:42 PM ET, by Corey Rosenbloom

I’m a big fan of so-called “EMA Compression” patterns because they often set-up breakout opportunities from clear reference levels.

Let’s take a look at the Daily Chart “EMA Compression” pattern in gold and what levels are important in the near future.

The main idea here is to recognize the price compression or consolidation between the falling 50d EMA (which has held as resistance since December) and the flat 200 day SMA.

The current falling 50 day EMA rests at $1,680 while the flat 200d SMA resides at $1,665 (Friday’s low).

I also drew a rising blue short-term trendline intersecting the $1,665 area above (another short-term falling trendline also intersects $1,680).

In terms of structure, due to a series of lower lows/lower highs and a bearish EMA structure, price remains in a short-term downtrend established since November 2012.

However, it’s often best from a trading standpoint to treat potential future breakouts from a neutral perspective instead of trying to predict which direction price will break.

Breakout trades profit from a quick “feedback loop” or rush of activity driven in part by one side of the market being caught off-guard and thus rushing to exit their (now) losing positions.

For a short period of time, both sides of the market are “doing the same thing” for very different reasons (in the case of an upside breakout, buyers would be putting on new positions while sellers may be taking off old positions at a loss – buying to cover).

The hourly chart provides a more detailed look at the short-term levels and potential future targets on a breakout:

Again we see the blue compressing trendlines forming a “triangle” pattern from $1,665 to $1,680.

A breakthrough beyond one of these levels could lead to a quick impulse toward the prior inflection high at $1,700 or $1,640 (levels for intraday traders to target).

Beyond that, a firm breakthrough above $1,700 would trigger a short-term trend reversal as price creates a higher high after a higher low and would trade above the daily EMAs.

A continuation of the move above $1,700 could target the $1,750/$1,760 prior swing high from November.

On the other hand, a ’surprise’ breakdown under $1,640 could set up a sudden play toward the $1,600 prior support from August.

Take these levels and potential outcomes into your trade planning and analysis.

For educational reference, here is my prior post on “EMA Compression” that occurred in AAPL (you can view the outcome now).

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade

Corey's new book The Complete Trading Course (Wiley Finance) is now available!

blog.afraidtotrade.com


SDI Glossary: "Breakout" Definition
SDI Glossary: "price" Definition
SDI Glossary: "Finance" Definition
This Article's Word Cloud:   Beyond   Compression   Corey   November   Trade   above   afraidtotrade   also   analysis   blue   break   breakout   breakthrough   could   established   falling   flat   forming   from   future   here   high   higher   intersects   levels   look   lower   market   often   pattern   positions   potential   price   prior   quick   reference   resides   short   since   structure   target   term   that   these   toward   trade   trendline   which   while   would

| More

Short Sale Swing Candidate Lesson for Exelon EXC
Wed, Apr 23, 4:41 PM ET, by Corey Rosenbloom

For those aggressive traders who enjoy fading strength – or calling potential turning points in ...

April 23 Sector Breadth and Intraday Trading Update
Wed, Apr 23, 1:31 PM ET, by Corey Rosenbloom

With today’s Flat Range Day in motion so far, let’s take a look at our ...

Video: John vs The Machines (Carter Takes on HFT)
Tue, Apr 22, 3:11 PM ET, by Corey Rosenbloom

John Carter’s at it again with an entertaining yet educational new video about the world ...

April 22 Breakout Trend Day Breadth Update and Stock Scan
Tue, Apr 22, 1:11 PM ET, by Corey Rosenbloom

With price breaking through resistance and defying divergences, let’s take a look at Sector Breadth ...

Are We Really Repeating this SP500 Pattern Again?
Tue, Apr 22, 10:11 AM ET, by Corey Rosenbloom

Could we be caught in the Twilight Zone again and doomed to repeat the same ...

April 21 Range Reference and Market Internals Update for SP500
Mon, Apr 21, 1:41 PM ET, by Corey Rosenbloom

What message are the Big Three Market Internals sending us as we challenge an upper ...

Planning an April Pivot Trade for Biogen BIIB
Mon, Apr 21, 11:51 AM ET, by Corey Rosenbloom

Biogen (BIIB) is setting up an inflection or “Pivot Trade” that we can study as ...

April 17th Utilities Collapse Intraday Breadth Update and Stock Scan
Thu, Apr 17, 1:31 PM ET, by Corey Rosenbloom

What a difference a day makes! In yesterday’s mid-day update, I highlighted a broader bullish ...

Utilities and Stocks Breaking to New 52 Week Highs
Wed, Apr 16, 7:11 PM ET, by Corey Rosenbloom

Sometimes the simplest things are effective for finding candidates to trade on a short-term or ...

April 16 Bullish Sector Breadth and Trending Stocks
Wed, Apr 16, 2:21 PM ET, by Corey Rosenbloom

We finally have broad bullish sector breadth for today’s bullish bounce session. Let’s take a ...

The Correction As Seen in the ETP Landscape
Tue, Apr 15, 3:11 PM ET, by Bill Luby

Since stocks bottomed in March 2009, I have periodically been publishing an SPX pullback table ...

Tax Day Bearish Sector Breadth and Stock Scan
Tue, Apr 15, 2:11 PM ET, by Corey Rosenbloom

April 15th brings a lunar eclipse (blood moon) and “tax day.” Putting those things behind ...

Seven New 52 Week Highs and One New Low for April 14
Mon, Apr 14, 2:21 PM ET, by Corey Rosenbloom

Following-up on this morning’s intraday Breadth and Trending Stock Scan update, let’s take a quick ...

Bullish Sector Breadth with Caution and Trending Stock Scan for April 14
Mon, Apr 14, 1:21 PM ET, by Corey Rosenbloom

While the broader US Stock Market rallies sharply off an inflection low today, the Sector ...

April 11 Breakdown Sector Breadth and Trending Update
Fri, Apr 11, 1:41 PM ET, by Corey Rosenbloom

With the broader market breaking a key support level this morning, let’s take a quick ...

Essential April Fibonacci Retracement Levels for Dow NASDAQ and SPX
Fri, Apr 11, 12:41 PM ET, by Corey Rosenbloom

With the US Equity Markets correcting lower against recent highs, let’s take a moment to ...

April 10 Another Collapsing Breadth and Downtrending Stock Update
Thu, Apr 10, 1:31 PM ET, by Corey Rosenbloom

We’re seeing another sharp rotation of money flow out of stocks as seen by price ...

Gaps and Traps with Breaks and Fakes for ISRG
Wed, Apr 9, 3:51 PM ET, by Corey Rosenbloom

Intuitive Surgical (ISRG) is the weakest performing stock today (largest percentage loser) in the S&P ...

Tricks and Traps with Breaks and Fakes for ISRG
Wed, Apr 9, 3:31 PM ET, by Corey Rosenbloom

Intuitive Surgical (ISRG) is the weakest performing stock today (largest percentage loser) in the S&P ...

Bounce Continues for April 9 Sector Breadth and Trending Stock Update
Wed, Apr 9, 1:31 PM ET, by Corey Rosenbloom

Well that was a relief! Price continued to rally up off the key support level ...

April 8 Reversal Sector Breadth and Trending Stock Scan
Tue, Apr 8, 1:21 PM ET, by Corey Rosenbloom

With a sudden reversal off expected support in the S&P 500, let’s dig a little ...

Traps Trendlines and Current Reference Levels for US Equity Futures
Tue, Apr 8, 11:31 AM ET, by Corey Rosenbloom

After a Bull Trap outcome sent equity prices back to the lower support boundary, let’s ...

Study Lesson on Lengthy Market Internal Divergences and Snapbacks
Mon, Apr 7, 2:41 PM ET, by Corey Rosenbloom

Students of Market Internals know that Friday’s and Monday’s sharp downside reversal in the US ...

April 7 Collapsing Sector Breadth and Intraday Trending Stocks Scan
Mon, Apr 7, 1:31 PM ET, by Corey Rosenbloom

At the halfway point of an extended sell-off in the Stock Market, what message does ...

April 4th Reversal Day Breadth and Trending Stocks
Fri, Apr 4, 1:41 PM ET, by Corey Rosenbloom

What a day this has been so far! Let’s get right to our intraday Sector ...

Quick Charting April Market Internals at the Highs
Wed, Apr 2, 3:21 PM ET, by Corey Rosenbloom

While the S&P 500 is breaking again to all-time highs in today’s session, let’s peek ...

April 2 Midday Stock Market Breadth and Trend Update
Wed, Apr 2, 2:11 PM ET, by Corey Rosenbloom

With the trading day more than halfway complete, let’s take a look at the top ...

April Pullback Retracement Play in Facebook FB
Tue, Apr 1, 3:11 PM ET, by Corey Rosenbloom

Facebook (FB) shares face a major “make or break” support challenge at a key opportunity ...

March 31 Intraday Sector Breadth and Trending Stock Scan
Mon, Mar 31, 1:21 PM ET, by Corey Rosenbloom

What does “Sector Breadth” reveal about today’s session (and which sector should we be avoiding ...

Quick SP500 Trend and Range Surfing Update
Mon, Mar 31, 1:11 PM ET, by Corey Rosenbloom

As we end March and the first quarter 2014, let’s take a quick look at ...

CBOE RMC 2014: A Retrospective
Mon, Mar 31, 8:11 AM ET, by Bill Luby

Earlier this month, I had the pleasure of attending the CBOE Risk Management Conference (RMC) ...

The Turnaround in Emerging Markets and VXEEM
Sun, Mar 30, 8:11 AM ET, by Bill Luby

While I have a long way to go before I become the next Manny Mota, ...

Three Aggressive Reversal Plays from Consecutive Down Days
Fri, Mar 28, 3:51 PM ET, by Corey Rosenbloom

As we end the week, let’s look at three stocks that top the “Most Consecutive ...

Key Support Pivot Forming in Amazon AMZN
Thu, Mar 27, 3:41 PM ET, by Corey Rosenbloom

Amazon.com (AMZN) shares hit a confluence support target today, as I highlighted originally in the ...

Key Inflection Planning Level for SP500 Topping Pattern
Thu, Mar 27, 3:11 PM ET, by Corey Rosenbloom

The S&P 500 continues to play out the “Repeat Topping Pattern” scenario I mentioned to ...

Intraday Sector Breadth and Trending Stock Update for March 26
Wed, Mar 26, 2:11 PM ET, by Corey Rosenbloom

With a strong mid-day downside reversal, let’s update our current Sector Breadth Chart (the message ...

Focusing on Key Support and an Open Air Pocket for Netflix NFLX
Tue, Mar 25, 1:11 PM ET, by Corey Rosenbloom

A quick glance at the Daily Chart of Netflix (NFLX) shows a critical support-test happening ...

Simple Repeating Top Pattern in the SP500
Mon, Mar 24, 12:41 PM ET, by Corey Rosenbloom

Is the market topping or is this just another in a string of smaller “repeat ...

Bearish Signals from the Sector Performance Grid in March
Mon, Mar 24, 10:51 AM ET, by Corey Rosenbloom

With the S&P 500 tipping to a weak all-time high Friday, what does the Sector ...

March 21 Intraday Sector Breadth and Trending Stocks
Fri, Mar 21, 1:51 PM ET, by Corey Rosenbloom

What is Sector Breadth revealing about the health of today’s rally, and which stocks are ...

March 20 Intraday Sector Breadth and Trending Stocks
Fri, Mar 21, 1:31 PM ET, by Corey Rosenbloom

What is Sector Breadth revealing about the health of today’s rally, and which stocks are ...

Exploring a Hidden Resistance Level in Amazon AMZN
Fri, Mar 21, 1:11 PM ET, by Corey Rosenbloom

On the surface, Amazon (AMZN) shares triggered a mini-Bull Trap on a break through daily ...

The New Options Trading Secrets Free Video
Thu, Mar 20, 6:11 PM ET, by Corey Rosenbloom

If you’re new to options trading, it can be helpful to learn as many strategies ...

March 20 Sector Breadth and Intraday Trending Stock Scan
Thu, Mar 20, 1:51 PM ET, by Corey Rosenbloom

Which stocks are “Trend Day” Candidates and what is Sector Breadth revealing about today’s session? ...

Setting Up a Bollinger Band Squeeze and Triangle Play in Apple AAPL
Thu, Mar 20, 1:11 PM ET, by Corey Rosenbloom

While most traders have gone cold on Apple (AAPL) – understandably so – it may ...

March 19 Fed Day Trending Stocks and Breadth Update
Wed, Mar 19, 1:41 PM ET, by Corey Rosenbloom

On today’s special “Fed Day” session, which stocks are the strongest intraday trenders (there are ...

Head and Shoulders Reversal Trade Planning for Celgene CELG
Tue, Mar 18, 12:31 PM ET, by Corey Rosenbloom

Despite a strong uptrend, Celgene (CELG) shares face a critical challenge at a make-or-break(down) support ...

A Lesson and Swing Trade Planning from Caterpillar CAT
Mon, Mar 17, 2:11 PM ET, by Corey Rosenbloom

I’ve been covering the price breakout and impulsive trend move up for Caterpillar (CAT) shares. ...

March 17 Intraday Trading Stocks and Breadth Grid Update
Mon, Mar 17, 1:11 PM ET, by Corey Rosenbloom

As we trade through St. Patrick’s Day, which stocks top the list of intraday uptrenders ...

Strength and Breakouts in Sleeper Utilities XLU
Fri, Mar 14, 2:21 PM ET, by Corey Rosenbloom

We don’t see Utility Stocks gain as much media coverage or trader attention as high-flying ...

  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

Gold Showing EMA Compression with Targets | Self Directed Investor | Copyright © 2008 - 2014, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of over 1000 individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.