03/09/2010 Market Recap: More Topping Signs

TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart) Long-term 3 of 3 are BUY     Intermediate 3 of 3 are BUY 4 of 6 are NEUTRAL SPY ST Model is in BUY mode Short-term 1 of 1 are BUY 5 of 8 are NEUTRAL

BULLISH 1.0.2 S&P 500 SPDRs (SPY 60 min): Could be Head and Shoulders Bottom, target 119.42. BEARISH 1.0.2 S&P 500 SPDRs (SPY 60 min): 15 unfilled gaps. (max was 15) 1.1.0 Nasdaq Composite (Daily): 9 unfilled gaps. (max was 9) 2.3.4 Nasdaq Total Volume/NYSE Total Volume: Topped? 2.4.4 NYSE McClellan Oscillator: NYHGH too high. 03/08 Market Recap: Institutional Distribution is too low. 0.0.1 Market Top/Bottom Watch: *NYDNV too low. 0.0.6 Nasdaq 100 Index Intermediate-term Trading Signals: *NAADV MA(10) too high. 0.0.9 Extreme Put Call Ratio Watch: *Topped? CONCLUSION Could short after seeing a daily reversal bar (Open > Close), for aggressive traders only.

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE. TRADING VEHICLE: SSO/SDS, UPRO/SPXU ST Model 02/26 L breakeven Reversal Bar 02/26 L *03/05 low *Adjust Stop Loss. NYMO Sell       VIX MA ENV

OTHER ETFs COMMENT – *New update. Click BLUE to see chart if link is not provided. QQQQ NAADV MA(10) too high. IWM ChiOsc too high. CHINA Big red bar usually means more pullback ahead. EMERGING CANADA Bearish reversal bar, could pullback. FINANCIALS REITS MATERIALS Black bar, could pullback. ENERGY Broadening Top in the forming, the breakout direction is unknown. OIL Bearish reversal bar, could pullback. GOLD DOLLAR Head and Shoulders Bottom. ChiOsc too low. BOND

INTERMEDIATE-TERM: RISE TO 03/08 THEN PULLBACK TO 03/16?

See 03/05 Market Recap as multiple Gann days are due around 03/08 and 03/16 and the market is pretty overbought so the logic guess is it could pullback from around 03/08 to around 03/16.

Overall according to the past II pattern, I believe eventually we’ll see a bigger correction. Just for now except for the Gann theory arguing that 03/08 could be a major top,  I have no other evidences supporting an imminent big correction.

SHORT-TERM: MORE TOPPING SIGNS

Still expect a pullback as more topping signs are piling up today:

0.0.1 Market Top/Bottom Watch, NYDNV too low, see red dashed lines.

0.0.6 Nasdaq 100 Index Intermediate-term Trading Signals, NAADV MA(10) too high, see red dashed lines.

0.0.9 Extreme Put Call Ratio Watch, both CPC and CPCE are too low, see red dashed lines.

 

2.0.0 Volatility Index (Daily), 2 black bar in row, still think the chances of reversing up are high from here.

The charts below are for your info only. I didn’t mean to imply that today is a top although there’re more than 50% chances. See red bars, those were whenever VIX and SPY both green for 2 days in a row.

 

Take a look at today’s Selling on Strength, the IWM Block Sell was a little bit big, 220 / 406 = 54%. The last time this big was on 01/14/2010.

 

1.0.9 SPX Cycle Watch (60 min), right at cycle due hours, let’s see tomorrow.

 

STOCK SCREENER:  For fun only, I may not actually trade the screeners. Since SPY ST Model is in BUY mode, only LONG 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.

Since the intermediate-term direction is not clear, so no stock screeners from now on until the dust settles.