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Thursday, February 24, 2011

02/24/2011 Market Recap: All pullbacks start with 3 consecutive down days

  TREND MOMENTUM COMMENT
Long-term 2 of 2 are BUY  
Intermediate 3 of 5 are SELL 4 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in SELL mode.
Short-term 6 of 6 are NEUTRAL
GANN DAY MOON:SOLAR CYCLE CONCLUSION
02/20 02/18 : 02/19 02/19 Next pivot date: 02/20
BULLISH 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.
4.1.0 S&P 500 Large Cap Index (Weekly): Cup with Handle, target 1428.
*6.2.2b VIX Trading Signal (BB): Buy setup triggered on 02/24.
0.1.0 SPY Short-term Trading Signals: A few short-term long signal triggered on 02/23.
BEARISH 4.0.4 Dow Theory: Averages Must Confirm: BPSPX is way too overbought.
4.0.1 SPX Long-term Trading Signals: Weekly EMA(13) is way too high above weekly EMA(34).
4.1.0 S&P 500 Large Cap Index (Weekly): Price is now too high above MA(200).
02/14 Market Recap: Smart/Dumb Money Confidence spread is too large.
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING PLATFORM: SSO/SDS, UPRO/SPXU
Non-Stop 02/24 S N/A 02/23: Close long and sell short, can wait for a few days to avoid whipsaw.
ST Model     *Long if up day tomorrow. The stop loss is 1.9*ATR(10).
Short-term N/A Trend is DOWN. I hold partial short position overnight.
My Thoughts The pullback since 02/22 will last for awhile but the 02/18 high will be visited again.

SHORT-TERM: THE 1ST DOWN LEG COULD HAVE COMPLETED

As mentioned in today’s intraday comment, RSI positive divergence plus breakout trend line then back test the previous low then strong rebound is a typical reversal pattern, so chances are good that the very 1st down leg has completed. The initial rebound target is Fib 38.2 as above it, the resistance will become tougher and tougher. The chart below also listed another lower possibility that we might have a small lower low tomorrow, so if you bought dip today, beware this little trick.

SPY60min

Two additional stuff for your attention:

Since the March 2009 rally, all pullbacks began with 3 consecutive down days, so another evidence, if a rebound tomorrow, there could be a 2nd leg down thereafter.

3ConsecutiveDownDays

6.2.2b VIX Trading Signal (BB), 6.2.0a VIX Trading Signals (ENV), VIX long setup has been triggered today.

VIXBBLongSetup

INTERMEDIATE-TERM: PULLBACK SINCE 02/22 COULD LAST 4 WEEKS ON AVERAGE, THE 02/18 HIGH WILL BE REVISITED THEREAFTER

See 02/23 Market Recap for more details.

SEASONALITY: BEARISH THE NEXT WEEK

See 02/18 Market Recap for more details.

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

SIGNAL COMMENT
QQQQ 01/28 S Testing MA(50).
NDX Weekly UP
IWM Testing MA(50).
IWM Weekly UP
CHINA
CHINA Weekly UP No higher low yet but the rebound is so strong so could be in uptrend now.
EEM
EEM Weekly DOWN
XIU.TO 02/04 L
XIU.TO Weekly UP Too far above MA(200), %B too high.
TLT Could be a channel breakout, trend may about to change.
TLT Weekly DOWN
FXE
FXE Weekly UP
GLD
GLD Weekly UP
GDX 02/03 L
GDX Weekly UP
USO Clear breakout on WTIC chart.
WTIC Weekly UP
XLE 02/09 S
XLE Weekly UP Too far above MA(200).
XLF 10/15 L Testing MA(50).
XLF Weekly UP
IYR
IYR Weekly UP
XLB 02/09 S
XLB Weekly UP BPMATE is way too overbought.

  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 trading signals will be given in this report except the mechanical signals such as SPY ST Model.
  3. * = New update; Blue Text = Link to a chart in my public chart list.
  4. Trading signals in OTHER ETFs table are mechanical signals. See HERE for back test results. 08/31 L, for example, means Long on 08/31.
  5. UP = Intermediate-term uptrend. Set when I see at least one higher high and higher low on daily chart.
  6. DOWN = Intermediate-term downtrend. Set when I see at least one lower high and lower low on daily chart.
Posted by Cobra at 8:41 PM
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