Monday, March 16, 2009

Weekly Report on ER - Mar 16th to 20th '09

This report adds to the ES report below, to which ER (TF) is largely correlated.

ER reached Fib target in the low 390s and has little energy left here as well although it may try and reach stall level just short of 400 or even the strong resistance level on 406. ER has recently been lagging ES a bit, and both symbols should try and settle on their respective targets, hence we could see creep a little higher still before retracing. It would however make sense to see ER gather strength later on near 375.

Same "early recovery" mode on MTFS here indicates some likely instability while comforting a turnaround even if it is bumpy. After all ER reached the 346 Fib target to then bounce to Fib retracement level on low 390s. As bars are blue (like on the 60mins chart) we have to assume that ER will try and aim higher before retracing, and here again, 375 would be a good support for a change in trend later on.

This chart tones down any undue optimism here again. We need time to dissipate the accumulated selling pressure and we also need to see a strong support level level holding, otherwise ER will resume its course to 312. or even lower.

We shall assume a change in trend is slowly taking place, so the same recommendation is valid to either wait a little longer to pick a good entry level. Obviously shorter term players would be long already with stops a little lower than recent lows as mentioned in previous reports (2 weeks ago already). More conservative investors are likely to first wait for 500 (salient Fib/MM level) to be passed and tested for support.

( posted 7:50 UK )