AUDUSD (Australian Dollar / U.S. Dollar) at 1.0570 Bearish Divergence on the Weekly Chart Points Lower (SELL)

AUDUSD formed a bearish divergence from 02 May/27 Jul weekly highs ahead of the the decline to test the 28-month long-term rising trendline from Mar 2009 low. While the deteriorating MACD and RSI on the weekly chart continue to point lower, scope remains for further weakness towards 1.0360 (Support 1) near the long-term trendline then the key 0.9925 support (Support 2) for a potential retest. A breakdown below there would open 0.9533 (Support 3) near the 50% retracement of the 0.8062 (25 May 2010 low)/1.1085 (27 Jul 2011 high) 14-month upswing. It would take strength back above 1.0764 (01 Sept high, Resistance 1) to stabilize the market. An upside break there would re-open the significant 1.1085/1.1016 resistance zone (Resistance 2/3).

Trading Indication:

Short-term (Intraday):

Sell at 1.0630 or higher

Target at 0.9925 and lower; Stop loss at 1.0765 (1.9%)

Long-term: Possibly buy lower

S&P 500 cash index (SPX) at 1173.97 POTENTIALLY FORMING A BEAR FLAG PATTERN (SELL)

SPX extended the 19-day consolidation (since 09 Aug YTD low) to form a potential bear flag. The recent advance stalled at 1230.71 (31 Aug) near the rising channel resistance (from 09/22 Aug lows/15 Aug high). The subsequent decline exposes 1135.91 (Support 1) near the lower bounds of the channel then the key 1121.09/1101.54 support zone (Support 2). A breakdown below there would open 1139.70 (27 Aug 2010, Support 3) for a potential retest. It would take strength back above 1230.71 (Resistance 1) to stabilize the market. An upside break there would re-open the significant 1249.05/1258.0 resistance (Resistance 2) (former support, 16 Mar/16 Jun lows). Only reclaiming the resistance zone would allow bulls to target 1286.56 (Resistance 3). near 76.4% retracement of the 1347.00/1101.54 fall.

Trading Indication:
Short-term (Intraday):
Sell at 1180.00 or higher
Target at 1100.00 and lower; Stop loss at 1203.0 (1.9%)
Long-term: Possibly buy lower

IAG (Iamgold Corp.) at 21.39: 13-month Rising Trendline Supports Consolidation (BUY)

IAG has been basing above the 21-month falling trendline support (former resistance from 02 Dec 2009/12 May 2010/09 Nov 2010 highs) and the 13-month rising trendline support (from 27 Jul/17 Nov/01 Dec 2010 lows) since forming the double top at 23.38 (24 Mar/06 Apr 2011 YTD highs). The recent advance off the 18.20 low (11 Aug) extended to reach 21.81 (02 Sept) near the 5-month bear trendline (from 07/08 Apr/25 Jul highs) which, if breached, would expose the 22.20 pivot high (Resistance 1). With the daily trend/momentum studies still constructive, scope remains for bulls to target 23.38 (Resistance 2). Clearance above would initiate the next upleg towards the equality target at 25.00 (projected 16.06/23.38 from 17.69, Resistance 3). However, a break below 19.26 (Support 1) would indicate continuation of the 5-month base and reopen 18.20 (Support 2), then 17.69 (Support 3) near the 13-month rising trendline support where bulls may reassert.

Trading Indication:
Short-term (Intraday):
Buy at 20.30 or lower;
Target at 22.20 and higher; Stop Loss at 20.00< (1.50%)
Long-term: Possibly buy lower at 18.20

USO (United States Oil Fund) at 34.45 BEAR FLAG UNDER 10-MONTH HEAD-&-SHOULDER RESISTANCE (SELL)

USO’s corrective bounce off the 30.31 YTD low (09 Aug) within an upward channel indicated a bear flag and stalled at 34.89 (01 Sep high), just short of the formidable 35.14 shoulder resistance of the head-and-shoulder top pattern formed over the last 10 months. While the upper bounds of the channel near 35.14 caps, there is scope for a swing high ahead of a downside reversal. A break below the pre-gap low at 33.69 (Support 1) would expose 30.31 for a potential retest (Support 2). Additional weakness there would risk a deeper setback towards 25.50, the head-and-shoulder target (from 45.60/35.14, 02 May high/27 Jun low, Support 3). However, reclaiming 35.14 (Resistance 1) would negate the bear flag/head-and-shoulder patterns and shift the near-term focus higher. An upside break there would stage 37.33 (Resistance 2), near 50% retracement of the 45.60/30.31 ahead of 39.25 (Resistance 3) near 61.8% retracement.

Trading Indication: Short-term (Intraday):
Sell at 34.70 or higher;
Target at 30.31 and lower; Stop Loss at 35.20> (1.4.0%)
Long-term: Possibly buy lower

ZIP (Zipcar Inc.) at 21.20 PROBING 4-MONTH BEAR TRENDLINE RESISTANCE (SELL)

ZIP rebounded off the 17.03 YTD low (22 Aug) to probe the former 4-month bear trendline resistance (from 20 Apr/14 Jul/01 Aug highs), reaching 22.00 (31 Aug high) before consolidating. While the significant lower high at 22.08 (Resistance 1) near the former bear trendline caps, scope remains for bears to target 20.71 (Support 1) then 19.15 (Support 2). A clean loss there would open 17.03 (Support 3) for a potential retest. However, renewed strength above 22.08 would shift the near-term focus higher. An upside break there would stage 23.46 (Resistance 2), near 50% retracement of the 30.80(20 Apr YTD high) /17.03 decline, ahead of 25.88 (Resistance 3) near 61.8% retracement.

Trading Indication: Short-term (Intraday):
Sell at 21.60 or higher;
Target at 19.15 and lower; Stop Loss at 22.05> (2.0%)
Long-term: Possibly buy lower

LNKD (Linkedin Corp.) at 84.10 BREAKING ABOVE 22-DAY BEAR TRENDLINE RESISTANCE (BUY)

LNKD rebounded off the 70.04 low (25 Aug) following the bullish RSI divergence formed from the 08 to 25 August lows on the daily chart and breached the steep 22-day bear  trendline resistance (from 28 Jul/15/26 Aug highs) to reach 89.31 (31 Aug high) before consolidating. While 80.73 holds, scope remains for bulls to target the 93.53 key lower high (Resistance 1) near 50% retracement of the 115.05 (28 Jul high)/70.04 decline. An upside break there would stage 96.20 (Resistance 2) ahead of 100.44 (Resistance 3).
It would take a return through 80.73 to shift focus lower. A downside break below would reopen 75.89 (Support 2) which guards 70.04 (Support 3) for a potential retest.

Trading Indication:
Short-term (Intraday):
Buy at 82.30 or lower;
Target at 93.58 and higher; Stop Loss at 80.70< (2.0%)
Long-term: Possibly sell higher

FXCM (FXCM Inc.) at 11.69 BREAKING OUT OF A BULLISH WEDGE PATTERN (BUY)

FXCM has broken out of a falling wedge pattern (from 16 Aug high/19 Aug low) following the bullish RSI divergence formed from the 25 May to 09 August 2011 lows on the daily chart. While the 10.57 pivot low holds, there is scope for bulls to re-open the August high at 12.66 (Resistance 1). An upside break there would confirm the higher low at 10.57 and extend gains towards 13.35 (Resistance 2), then possibly 14.14 (Resistance 3). However, a break below 11.36 near the wedge upper bounds would delay and expose the 10.57 key support (Support 1). A downside break there would confirm a lower swing high under 12.66 and risk a deeper setback towards 9.43 (Support 2) ahead of 8.13 (09 Aug YTD low, Support 3).

Trading Indication: Short-term (Intraday):

Buy at 11.22 or lower;
Target at 12.66 and higher; Stop Loss at 11.00< (2.0%)
Long-term: Possibly sell higher