F&I Weekend Update
A side-note: The Slow Stochastic (39, 1) setting I use on the Market Quilts is based on a trading system called The 'Last' Stochastic. Although I don't use this trading system, I do use these numbers because they tend to smooth out the whipsaws.
Although AGG has managed to gain back some ground, I'm not yet ready to advocate placing money in Bonds. For one thing, the G-Fund is paying out 3.5% and that's a pretty good way to play it safe. Still there are some things (short-term) to be optimistic about for our fallen friend AGG.
On AGG's hourly chart I've outlined a potential ascending triangle with a 104ish price objective, this should play out by Mon/Tue if it's going to work. It would be hard to play this under IFT's rules and you can see the red circle shows this could be an area of resistance hard to push through. But, if 104 holds, then we should push up to 105. We'll just have to see.
You can see on the Bond's market Quilt many of the charts have left their embedded downside conditions. However, all of these signals are weak and I wouldn't trust them until the pass through the 50 level.
On the the I-Fund. A couple of nights ago I noticed a Bull Flag on the Dollar and a Bear flag on the Euro. The next morning I was listening to Youtube on the way to work when Oscar pointed out the same thing. I happen to think these flags are "long in the tooth" if they don't play out this week, then it's just side-ways action. Still, I've outlined a price target of 79.40 which could meet resistance from the 2 swing highs in August.
Oscar
The Currencies Quilt is still weak, so if you're wanting to play the I-Fund, you should know the Dollar is still strong. Also, some azzhat in Japan Naoto Kan, Japan's newly appointed finance minister, abruptly reversed his predecessor's currency strategy immediately on taking office yesterday, with his call for a weaker yen provoking an immediate sell-off in global markets.
Side note: On the 1 Month, 3 Month, & yearly charts, Oil is outperforming the Dollar, S&P 500, Gold, & Silver.
Still, there is some "hope." If you recall there are times when a declining dollar has an inverse friend in rising Oil & Gold. Right now this relationship is somewhat frayed, but with rising oil perhaps this dysfunctional couple will get back together?
The overseas quilt gained some strength and even our EFA managed to close above 80.
Thanks for your time, for updates in the Triad please see my account talk thread... Jason
