Live Update

Sunday, February 28, 2010

02/26/2010 Market Recap: Multiple Cycles Due

  TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)
Long-term 3 of 3 are BUY    
Intermediate 2 of 3 are BUY 4 of 6 are NEUTRAL SPY ST Model is in BUY mode
Short-term 1 of 1 are BUY 8 of 8 are NEUTRAL  
BULLISH
BEARISH 6.4.A SPY Bottom Shape: Could be another leg down to test the low. 
0.0.8 SPX:CPCE: A top was confirmed.
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 *02/26 L *1.5 x ATR(10)  
Reversal Bar *02/26 L *0.9 x ATR(10)
NYMO Sell      
VIX MA ENV    
OTHER ETFs TREND COMMENT – *New update. Click BLUE to see chart if link is not provided.
QQQQ   1.1.5 PowerShares QQQ Trust (QQQQ 30 min), *Double Bottom? Target $45.57.
IWM   *Not sure what the bearish reversal bar mean up or down.
CHINA   Double Top.
EMERGING Down
CANADA
FINANCIALS  
REITS  
MATERIALS   *Not sure what the black bar mean up or down.
ENERGY Down Broadening Top in the forming, the breakout direction is unknown.
OIL   ChiOsc too high.
GOLD Down
DOLLAR UP Head and Shoulders Bottom.
BOND Down *Shooting Star under resistance, could pullback.

INTERMEDIATE-TERM: COULD BE A BIGGER CORRECTION BUT NOT SURE IF THERE’S A NEW HIGH FIRST

My speculation about the intermediate-term is still from the II Survey – too many people are looking forward to a correction, so the market would rebound huge before a real correction kicks in. See red vertical lines below, so far repeats exactly the past pattern, right? So I believe there could be a bigger correction ahead. The only question is that the rebound since the Feb 5 is over or there is more?

IICorrection

Because there’re lots of cycles due for the next week and so far they look like a top. Besides, there’re some evidences in the short-term session below arguing for a revisit of the Thursday’s low, so the conclusion is maybe, probably, possibly, there’s not enough time for a new high. All the cycles are listed below:

  1. 1.0.7 SPX Cycle Watch (Daily)
  2. 1.0.8 SPX Cycle Watch (Moon Phases)
  3. 1.0.9 SPX Cycle Watch (60 min)

Take a look at the Important highs and lows Calendar. For the past 10 years, March had the most turning date (I think the March is famous as a turning month). The most famous one perhaps is 03/06/2009 when the mad cow began. There’re also several other turn dates around 03/06: 03/05/2004, 03/07/2005, 03/08/2006. And according to chart 1.0.7 SPX Cycle Watch (Daily), the purple line cycle due date happens to be on 03/08 (03/06 is weekend) as well. So, again, I believe the cycles due the next week could be trusted.

SPXDailyCycle 

SHORT-TERM: VERY LIKELY THE THURSDAY LOW WILL BE REVISITED

There’re 2 evidences arguing that the Thursday low could be revisited the next week. Of course, like all the other evidences I’ve been presenting, they just represent higher odds, they definitely are not sure thing to happen.

QQQQ weekly opened high closed in red, counting the red arrows and the blues arrows, ( 6 + 19 ) / 31 =  81% chances there’ll be a low which is lower than the Thursday’s low the next week.

QQQQWeeklyReversalBar 

Rydex Enthusiasm Index from sentimentrader, pay attention to the red vertical lines, if the retailers are too active in buying the dips, the next day may rise a little bit, see red arrows, but the 3rd day is usually not very pleasant which could mean that we may not see a very bullish Monday mentioned in the After Bell Quick Summary again.

RydexEnthusiasmIndex 

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.

Saturday, February 27, 2010

Important highs and lows Calendar

For record only, not meant to imply anything. The table below records all important highs and lows. Based on Gann Theory, they’re very important date to watch. From the table we can see, amazingly March is perhaps the most frequent turning month.

YEAR

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

2000

3

28

24

14

17,28

1

18

6

21

2001

31

22

22

21

2002

7

20

19

24

22

10

2

2003

12

2004

5

13

2005

7

20

2006

8

14

2007

22

14

6

16

11

26

11

2008

23

4

17

19

15

11

10,14

21

2009

6

6

11

8

 

2010

19

5

26

6,25

21

1

9,27

 

2010

 

18

16

                 

DATE

JAN

FEB

MAR

ARP

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

10/11

10

10

6

11

17

11

11

11/26

25

27

20

27

2,27

26

12/11

12

11

5

11

17

11

10

01/23

23

24

17

24

29

23

23

02/04

5

5,29

5

10

5

4

03/17

16

16

10

15

22

15

16

05/19

18

18

19

18

13

18

25

07/15

14

20

16

15

15

14

9

08/11

4

10

18

11

11

10

11

10/10

9

9

5

10

16

10

10

10/14

13

13

9

14

20

14

14

11/21

20

21

15

22

27

21

21

01/06

7

7

1

7

13

6

7

03/06

5

5,30

4

11

4

5

06/11

16

10

12

10

11

4

11

07/08

7

13

9

8

8

7

2

01/19

20

20

14

20

26

19

20

02/05

6

6,30

6

11

6

5

04/26

26

27

26

19

26

2,26

05/06

5

5

6

5,30

5

12

05/25

24

23

24

24

18

24

30

06/21

27

20

21

21

21

14

21

07/01

6

2

1

1,31

25

31

08/09

2

8

16

9

9

8

9

08/27

21

26

3,27

28

27

27

02/18

19

19

13

19

25

19

18

 

03/16

15

15

9

14

21

14

15

Friday, February 26, 2010

02/26/2010 After Bell Quick Summary

OK, let’s see what the famous “Bullish Monday” will bring us the next week. Seasonality wise, INDU was up 9 out of last 14 years on the first trading day of the March.

1

The bottom line, as mentioned in the last night report, multiple cycles are due on the next week, right now they all look like a top to me. You can click the links below to judge by yourself.

  1. 1.0.7 SPX Cycle Watch (Daily) 
  2. 1.0.8 SPX Cycle Watch (Moon Phases) 
  3. 1.0.9 SPX Cycle Watch (60 min) 

Enjoy your weekend!

Thursday, February 25, 2010

02/25/2010 Market Recap: Too soon to declare a bullish reversal

  TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)
Long-term 3 of 3 are BUY    
Intermediate 2 of 3 are BUY 5 of 6 are NEUTRAL SPY ST Model is in BUY mode
Short-term 1 of 1 are BUY 8 of 8 are NEUTRAL  
BULLISH
BEARISH 6.4.A SPY Bottom Shape: Could be another leg down to test the low. 
0.0.8 SPX:CPCE: A top was confirmed.
1.0.2 S&P 500 SPDRs (SPY 60 min): *12 unfilled up gaps.
6.4.7 NYSE Tick Watch (60 min): A little too long without -1,000 readings.
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     *Long if up day tomorrow.
Reversal Bar     *Long if up day 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.
EMERGING Down *Hollow red bar, could rebound.
CANADA *Bullish reversal, could rebound.
FINANCIALS Down
REITS  
MATERIALS   *Hollow red bar, could rebound.
ENERGY Down Broadening Top in the forming, the breakout direction is unknown.
OIL   ChiOsc too high. *Hollow red bar, could rebound.
GOLD Down *Bullish reversal, could rebound.
DOLLAR UP Head and Shoulders Bottom. *Multiple reversal bars, could pullback.
BOND Down *Doji testing up price channel. Could pullback.

INTERMEDIATE-TERM: IN WAIT AND SEE MODE

See 02/19/2010 Market Recap, not sure about the market direction, in wait and see mode.

SHORT-TERM: COULD BE ANOTHER REVERSAL DAY TOMORROW

0.0.2 SPY Short-term Trading Signals, I guess now everybody knows that a hollow red bar means a reversal. Unfortunately however, it’s hard to say the reversal bar today means a top or bottom.

SPYShortTerm

0.0.5 QQQQ Short-term Trading Signals, the same, hard to say it’s a top or bottom.

QQQQShortTerm

3.4.2 Financials Select Sector SPDR (XLF Daily), another example, top or bottom?

XLFDaily

So the conclusion is we need see a strong up tomorrow to prove that indeed the market was bottomed. Again unfortunately however, the chances for a strong up day are not very high tomorrow. There reasons:

1.0.2 S&P 500 SPDRs (SPY 60 min), ChiOsc too high which usually means a 4 hours pullback.

SPY60min

1.0.9 SPX Cycle Watch (60 min), there’re 2 cycle due tomorrow, so a gap up open tomorrow will look a lot like a cycle top, unless the market gap down sharply again tomorrow morning.

SPY60minCycle

Take a look at statistics here: Recovery Days Revisited which also says tomorrow could open high but may close low. For the completeness of this report, I attached a screenshot below but the credit belongs to www.tradingtheodds.com.

RecoveryDay

The bottom line, as mentioned in the 02/24 Market Recap, according to chart 1.0.7 SPX Cycle Watch (Daily) and 1.0.8 SPX Cycle Watch (Moon Phases), there’re several cycle due dates next week, whether they mean a bottom or top may depend on the market’s actions tomorrow and the next Monday. Right now it’s too early to see clearly.

SPXDailyCycle

6.4.7 NYSE Tick Watch (60 min), since someone asked so I posted the chart below. If still there’s no -1,000 readings tomorrow then it’ll be the longest streak without a -1,000  TICK readings on the chart.

TICK 

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.

02/25/2010 After Bell Quick Summary

Boy, what a day! I had an very expensive lunch by assuming everything would be the same before I could finish a very good discussion about certain strange traffic rules with my friends. Well, although this kind of intraday reversal is rare but occasionally it does happen, we trade on odds not on occasional events so I guess I’ll still enjoy my lunch assuming everything will be the same and pay for an very expensive lunch again and again.

The bottom line, I think we’ll at least see a new recovery high but if you’ve remembered my last night’s report about TICK and cycles, then both bulls and bears should be careful now, as we could be very close to a turning point.

One trick today, when both VIX and SPX closed in red, 20 out of 27 times (74%) a green day the next day.

1

Wednesday, February 24, 2010

02/24/2010 Market Recap: Repeats the post reversal bar pattern?

  TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)
Long-term 3 of 3 are BUY    
Intermediate 2 of 3 are BUY 5 of 6 are NEUTRAL SPY ST Model is in BUY mode
Short-term 1 of 1 are BUY 8 of 8 are NEUTRAL  
BULLISH
BEARISH 6.4.A SPY Bottom Shape: Could be another leg down to test the low. 
0.0.8 SPX:CPCE: A top could be confirmed.
1.0.2 S&P 500 SPDRs (SPY 60 min): *13 unfilled up gaps.
6.4.7 NYSE Tick Watch (60 min): *A little too long without -1,000 readings.
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    
Reversal Bar      
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.
EMERGING Down
CANADA
FINANCIALS Down
REITS  
MATERIALS  
ENERGY Down Broadening Top in the forming, the breakout direction is unknown.
OIL   ChiOsc high.
GOLD Down
DOLLAR UP Head and Shoulders Bottom.
BOND Down

INTERMEDIATE-TERM: IN WAIT AND SEE MODE

See 02/19/2010 Market Recap, not sure about the market direction, in wait and see mode.

SHORT-TERM: COULD SEE A NEW RECOVERY HIGH BUT LIKELY TO PULLBACK BIG THEREAFTER

The rebound today fits the post reversal bar pattern I mentioned in 02/22 Market Recap and 02/23 Market Recap. Now take a look at the most recent charts below, so far exactly repeats the past patterns, right?

SPYShortTerm QQQQReversalDay 

So there could be a new recovery high (higher than the Monday high) tomorrow or Friday. The target could be to fill the gap above as illustrated in chart 1.0.2 S&P 500 SPDRs (SPY 60 min).

SPY60min 

And after the new recovery high, if the past post reversal bar pattern still applies, there could be a bigger pullback. Below are 3 additional reasons to expect the pullback:

  1. 0.0.8 SPX:CPCE, the trend line held so the top could be confirmed now.
  2. 1.0.7 SPX Cycle Watch (Daily), 1.0.8 SPX Cycle Watch (Moon Phases), multiple cycle due date on March 1st, so up until March 1st, then March 1st could be a top.
  3. 6.4.7 NYSE Tick Watch (60 min), no -1,000 TICK readings for too long, so there could be a panic sell very soon. The Wednesday’s pullback was very special because there’s no -1,000 TICK readings while SPY dropped more than 1%. The past similar cases are: 01/12/2010, 01/09/2009 and 05/11/2009, check by yourself to see what had happened thereafter.

CPCE 

1.0.9 SPX Cycle Watch (60 min), just to remind, there’s a cycle due at 3:00pm ET so if the market keeps rising tomorrow, it could pullback right before the close.

SPX60minCycle 

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.

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