Weekly Analysis - WE 2 July 2010

Weekly Analysis WE 25 Jun 10

Looks like 'risk-on' again this week. Budget in UK may shape Stirling but rumours it will be bid on the austerity measures.

Short Dow Jones

Looks like a good set-up short - the dow sank on the closing session (that the pro's own!) and there is evidence on the xxxyen pairs that tomorrow will be negative for stocks. (Edit - this order never triggered and shows the strength in being patient and not trying for tighter entries into hammers etc on lower TFs. Always leave your entry a few pips above/below the candle!)

Long set-up on USDCAD

Possible long set up -123 with a hammer at a HL. Obama's comments on oil could hurt the CAD

Desire?

I'm also thinking of a position in Desire Petroleum. They have their second drill site quite near RockHoppers site and I feel they were unfairly punished when their first well came up dry. We now know that oil exists in the Northern Basin so this could be a good chance to pick up some shares in Desire while prices are depressed. I'm also locking away £1000 in BP as they have been smashed by the news and whilst they may still go down a little more I believe most of the news is now in the price. They are still a huge company and even if they do scrap the dividend thru political pressure - they will be back into super profits next year! Load up while they are cheap, (Edit: but only on supportive bullish price action on the weekly chart I forgot to say!!)

Falklands exposure via FOGL.LSE

Well, with a much bigger license area than Rockhopper (that has gone up 500% since striking oil in the north a few weeks back) Falkland Islands Oil and Gas (FOGL) has the chance of also becoming a 'ten-bagger' share. The company is due to report at the end of June on the first drilling at Toroa - I've had a love hate relationship with this share for many years but it could be make-or-break in early July.

Weekly Analysis WE 11 Jun 10

Quite a lot of neutral this week as some of the hammers on some pairs are still in play (ie lows not violated) I try and colour as per the swing in play and the controlling candle. For instance a hammer will mean a grey week until it's high is taken out positively meaning a new swing low has been put into place. Some weeks this can be confusing but I try and stick with the major trend in play. Forex trending looks so simple in hindsight - why am I still not short Euro after that great weekly shooting star and lower high?? Psychology - the stuff that separates winners and losers - ignore it at your trading peril!