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Monday, September 27, 2010

09/27/2010 Market Recap: Watch SPX 1148 and 1122

  TREND MOMENTUM COMMENT
Long-term 2 of 2 are BUY  
Intermediate 3 of 3 are BUY 5 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in BUY mode.
Short-term Model is BUY 6 of 6 are NEUTRAL The trend is up but I hold no long position overnight.
GANN DAY MOON/SOLAR CYCLE CONCLUSION
9/23,10/10-10/11 09/23 / 09/23 Week of 09/24, 09/28 Next pivot date: 09/21 – 09/23, 09/28 – 10/01
BULLISH 09/17 Market Recap: Down 3 weeks then up 3 weeks, the 8th and 9th week is statistically bullish.
0.1.1 SPX Intermediate-term Trading Signals: Head and Shoulders Bottom breakout, target 1242.
BEARISH 1.0.6 SPY Unfilled Gaps: 18 unfilled gaps, the max was 18.
09/23 Market Recap: AAII is way too bullish.
09/23 Market Recap: SPX 3 consecutive down days means more pullback?
6.1.9a Extreme ISEE Index Readings Watch: ISEE Indices & ETFs Only Index > 100, pullback?
6.5.2b Month Day Seasonality Watch and 6.5.2c Week Seasonality Watch: Bearish next week.
*6.4.3a SPY Bearish Reversal Day Watch: Bearish at least short-term?
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING PLATFORM: SSO/SDS, UPRO/SPXU
Non-Stop 09/07 L N/A Partial profits on 09/24.
ST Model 09/24 L 1.9*ATR(10)

SHORT-TERM: WATCH SPX 1148 and 1122

Nothing to say today, the short-term direction is not clear, need see which one gets broken first, SPX 1148 or 1122?

  1. Decisively close above 1148 then bullish. But how bullish will need some imagination, see intermediate-term session below.
  2. Decisively close below 1122, then could be Double Top or 1-2-3 Trend Change pattern which is a typical short setup.

SPY60min 

INTERMEDIATE-TERM: BULLISH, BUT NEED SOME IMAGINATION TO FORESEE HOW BULLISH

There’s no doubt that the intermediate-term is bullish, see 09/17 Market Recap and 09/24 Market Recap for back test results. However, as for how bullish, some imaginations are needed (and frankly, I don’t have such kind of ability). Because although the statistics about POMO below almost guarantees the market will be up huge in 3 months, but on the other hand, AAPL which now weights more than 20% in Nasdaq 100 index, is way too stretched that wasn’t pleasant for the overall market in the past. The question is: Will AAPL stretch even more this time? Or could the market be up huge without AAPL?

Take a look at the statistics about POMO first:

According to Permanent Open Market Operations (POMO) from Trading the Odds, since we’ve had more than 9 POMO within the last 20 trading days so the market should be up huge (more than 10%) in the next 3 months. The chart below is copied from Trading the Odds for completeness purpose.

POMO 

Now take a look at what happened whenever AAPL was so stretched:

AAPLTooStretched 

SEASONALITY: LAST TRADING WEEK OF MONTH WAS GENERALLY BEARISH

See 09/24 Market Recap for more details.


HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST
TREND COMMENT
QQQQ *LA 4.1.1 Nasdaq 100 Index (Weekly): NDX to SPX ratio too high.
IWM UP Morning Star?
CHINA  
EMERGING UP 4.1.6 iShares MSCI Emerging Markets (EEM Weekly): EEM to SPX ratio too high.
CANADA *LA TOADV MA(10) too high, pullback?
BOND *UP 4.2.0 20 Year Treasury Bond Fund iShares (TLT Weekly): Morning Doji Star?
EURO UP
GOLD UP *2 black Bar in a row, pullback?
GDX *DOWN 4.3.1 Market Vectors Gold Miners (GDX Weekly): GDX to SPX ratio too high.
OIL UP *Bearish reversal bar, pullback?
ENERGY *LA *Bearish reversal bar?
FINANCIALS *DOWN 4.4.2 Financials Select Sector SPDR (XLF Weekly): Head and Shoulders Top in the forming?
*3.4.0 Financials Select Sector SPDR (XLF Daily): Bearish reversal bar?
REITS *DOWN 4.4.3 Real Estate iShares (IYR Weekly): Home builder is lagging.
*3.4.1 Real Estate iShares (IYR Daily): Bearish reversal bar?
MATERIALS *LA *Bearish reversal bar?
  1. Please make sure you understand how to use the table above. The purpose of this report is to provide info so contradictory signals are always presented.
  2. Conclusions can be confirmed endlessly, but trading wise, you have to take actions at certain risk level as soon as you feel the confirmation is enough. There’s no way for me to adapt to different risk levels therefore no specific buy/sell signals will be given in this report except the mechanical signals such as SPY ST Model.
  3. * = New update.
  4. Blue Text = Link to a chart in my public chart list.
  5. LA = Lateral Trend.
Posted by Cobra at 9:02 PM
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