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Wednesday, March 30, 2011

03/30/2011 Market Recap: More Push Up Ahead?

  TREND MOMENTUM COMMENT
Long-term 2 of 2 are BUY  
Intermediate 3 of 5 are SELL 5 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in BUY? mode.
Short-term 6 of 6 are NEUTRAL
GANN DAY MOON:SOLAR CYCLE CONCLUSION
04/07-04/11 04/03 : 04/05 04/04-04/13 Next pivot date: 04/04-04/13
BULLISH 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.
02/23 Market Recap: Pullback could last 4 weeks, then 02/18 highs will be revisited.
03/11 Market Recap: Bullish in 3 to 6 months.
BEARISH 4.0.1 SPX Long-term Trading Signals: Weekly EMA(13) is way too high above weekly EMA(34).
03/18 Market Recap: Could see lower low ahead.
03/25 Market Recap: VIX 18% below MA(10) is bearish in 5 days.
My Thoughts The pullback since 02/22 may last but the 02/18 high will be revisited in 69 calendar days on average.
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 Unofficial buy signal trigged, the model could be in buy mode now.
ST Model 03/22 S  1.9*ATR(10) *Stopped out of short position with loss. No long position entered yet.
*Poor performance this year, working on better model, will replace this model soon.
Short-term UP 03/23 Low I hold partial long position overnight.

SHORT-TERM: MORE PUSH UP AHEAD

Two cents:

  1. May see pullback tomorrow, not sure though. The more certain thing is the push up is not over yet, so trading wise, I’d at least buy the very first pullback.
  2. Maintain the forecast mentioned in 03/25 Market Recap that 03/16 low will eventually be tested. For now, I dare not say that the low will be tested before the new high anymore though.

Why more push up ahead? Because the rally today is large enough to invalidate the 3 push up pattern on SPX, so before a little bigger pullback is possible, the previous high (say today’s high, assuming SPX starts to pullback tomorrow) needs to be tested first. Then why a pullback maybe tomorrow? Because QQQ has fulfilled its 3 push up pattern so may pullback tomorrow therefore  could drag down the SPX as well.

SPY60min

Another reason for calling more push up ahead is INDU has higher high again today, so expect SPX to follow soon. By the way, this also is the reason why I dare not say that the 03/16 low will be tested before the new high, because a little bit push up INDU will be at new high and so will SPX.

INDULeadsMarket

The chart below is another argument for calling a pullback tomorrow, not a solid one but interesting. Generally, each up swings should get weaker and weaker (as buyers become less and less while sellers become more and more). From the chart below, we can see:

  • From 03/16 to 03/21, SPX rose 51 points in 3 days;
  • From 03/23 to 03/25, SPX rose 35 points in 3 days;
  • 35 / 51 = 0.68;
  • From 03/29 to 03/30, SPX rose 26 points in 2 days;
  • 26 / 35 = 0.74;

Where 0.74 has already exceeded the previous rate of 0.68, so my guess is, the high might have already been in today, so even SPX keeps up tomorrow, most likely there won’t be a higher high.

RallySize

As for why maintain the forecast that 03/16 low will eventually be tested, the main reason still is 9 down vs 10 up, bulls lost, therefore by definition this still is a sellable bounce, which in another word is the 03/16 low is not THE BOTTOM.

NvsN

INTERMEDIATE-TERM: BULLISH IN 3 TO 6 MONTHS

Combine the study mentioned in 02/23 Market Recap and 03/11 Market Recap, I still believe that 02/18 high will be revisited.

SEASONALITY: BEARISH 03/31, BULLISH 04/01

According to Stock Trader’s Almanac:

  1. Last trading day of March, Dow down 11 of last 16, Russell 2000 up 12 of last 16.
  2. Frist trading day in April, Dow up 13 of last 16.

See Friday’s After Bell Quick Summary for seasonality chart for the last 2 and the 1st trading days of the month.

For March seasonality chart please refer to 03/01 Market Recap.

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

TREND COMMENT
QQQQ&Weekly DOWN *NAADV MA(10) is way too high.
IWM & Weekly UP
SSEC & Weekly UP
EEM & Weekly UP
XIU & Weekly UP TOADV MA(10) is way too high.
TLT & Weekly UP
FXE & Weekly UP
GLD & Weekly UP
GDX & Weekly *03/30 S
USO & Weekly UP
XLE & Weekly UP
XLF & Weekly DOWN
IYR & Weekly UP
XLB & Weekly UP
DBA & Weekly DOWN

  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. * = New update; Blue Text = Link to a chart in my public chart list.
  3. UP = Intermediate-term uptrend. Set when weekly buy signal is triggered.
  4. DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.
Posted by Cobra at 9:42 PM
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