06/27/2011 Market Outlook (Will the 3rd time be the charm?)

SHORT-TERM: HAVE A LITTLE DOUBT ABOUT TODAY’S RALLY

Still the same old question: does the rally today prove that the low was in?

The answer still is, I have a doubt.

My main witness is the last 60 min bar is too red, looks very much like the previous 2 times when SPY sharply gapped down the next morning. It especially looks suspicious that today’s rally, although huge but the money flow is very negative. Read carefully on the table below, clearly the selling was from block trades which in another words are big guys were selling into the strength. Well, again, bulls can always argue that the 3rd time is different, so let’s see tomorrow.

INTERMEDIATE-TERM: MORE SELLING AHEAD

See 06/24 Market Outlook for more details.

SEASONALITY: BEARISH THURSDAY BULLISH FRIDAY

See 06/24 Market Outlook for more details. Also, see 06/24 Trading Signals for seasonality surrounding the Independence Day.

ACTIVE BULLISH SIGNALS:

• N/A

ACTIVE BEARISH SIGNALS:

• N/A

ACTIVE BULLISH OUTLOOKS:

• 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.

ACTIVE BEARISH OUTLOOKS:

• N/A

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST: 

TREND COMMENT SPY & Weekly DOWN   QQQ & Weekly DOWN   IWM & Weekly DOWN Head and Shoulders Top, target $74.57. SSEC & Weekly DOWN 2 huge consecutive up days usually mean SSEC was bottomed.  EEM & Weekly DOWN Chances of breakdown are higher.  XIU & Weekly DOWN Double Top, target $17.69. DAX & Weekly DOWN TLT & Weekly UP   UUP & Weekly UP   GLD & Weekly UP Double Top, target $142.52.  USO & Weekly DOWN *3 hollow red bars in a row, rebound? XLE & Weekly DOWN Complex Head and Shoulders Top, target $64.35. XLF & Weekly DOWN Bear Flag?  IYR & Weekly DOWN Double Top, target $57.34. XLB & Weekly DOWN

* = New update; Blue Text = Link to a chart in my public chart list. UP = Intermediate-term uptrend. Set when weekly buy signal is triggered. DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.