02/17/2010 Market Recap: A Surge of Reversal Bars

TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart) Long-term 3 of 3 are BUY     Intermediate 2 of 3 are SELL 6 of 6 are NEUTRAL SPY ST Model is in SELL mode Short-term 1 of 1 are BUY 6 of 9 are OVERBOUGHT

BULLISH 0.0.3 SPX Intermediate-term Trading Signals: CPC MA10 is too low. 1.0.3 S&P 500 SPDRs (SPY 30 min): Ascending Triangle confirmed. Target $111.72. BEARISH 6.4.A SPY Bottom Shape: Could be another leg down to test the low. 02/12 Market Recap: Seasonality is generally bearish this week. 2.4.2 NYSE - Issues Advancing: Overbought. CONCLUSION

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE. TRADING VEHICLE: SSO/SDS, UPRO/SPXU ST Model     *Short if Open > Close tomorrow. Reversal Bar     *Short if Open > Close tomorrow. NYMO Sell       VIX MA ENV

OTHER ETFs TREND COMMENT – *New update. Click BLUE to see chart if link is not provided. QQQQ   IWM   *ChiOsc too high. CHINA Down Double Top confirmed. EMERGING Down *Black bar. CANADA FINANCIALS Down *Black bar. REITS   MATERIALS   *ChiOsc too high. ENERGY Down *Bearish Reversal Bar. OIL   GOLD Down DOLLAR UP Head and Shoulders Bottom, target $24.28.  *ChiOsc too low. BOND Down

INTERMEDIATE-TERM: INITIAL PULLBACK TARGET MET BUT COULD BE MORE

No update, see 02/05/2010 Market Recap, Fib 38.2% retracement target was met, but I suspect there’s more. There’s a chance that after the pullback is over, we’ll see a new high followed by a bigger pullback thereafter.

SHORT-TERM: NO CLEAR DIRECTION  

A Doji is formed in chart 0.0.2 SPY Short-term Trading Signals, which means either a reversal or a continuation, so the short-term direction is not clear. However from the table above, we can see that the short-term is a little bit overbought, plus as mentioned in today’s After Bell Quick Summary, a negative seasonality and so called “bearish Thursday”, so we might see a pullback tomorrow, I’m not sure though.

 

The most interesting thing today is that my stock screener found 50 candidates. As you might have noticed my stock screener usually can find only 1 candidate each day while it found 7 yesterday and 50 today. The stock screener uses three major scan conditions:

1. In strong downtrend.
2. Overbought.
3. Bearish reversal bar (including filled black bar and hollow red bar).

So accordingly, 50 candidates found means a lot of stocks formed a bearish reversal bar today. Does this mean that the market is very close to a turning point? Well, we might know tomorrow.

STOCK SCREENER:  For fun only, I may not actually trade the screeners. Since SPY ST Model is in SELL mode, only SHORT candidates are listed. For back test details as well as how to confirm the entry and set stop loss please read HERE. Please make sure you understand the basic risk management HERE.

Today’s screener has 50 stocks found.

 

According to the entry rule, GDX, HK, PSSI found yesterday were confirmed.