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Sunday, April 26, 2009

04/24/2009 Market Recap: Still no Higher High

  Trend Momentum Comments - Sample for using the trend table. Warning: This is NOT a trading recommendation!
Long-term Down   Idea for trading intermediate-term under primary down trend.
Intermediate Up Overbought According to $NYA50R and $CPCE, the market might be topped.
Short-term Up Neutral  
Report Focused On Buyable dip or the market topped?
Today’s Summary Expect market seesaw for a few weeks.
Expect a pullback as early as the next Monday.

7.1.0 Use n vs n Rule to Identify a Trend Change.  Bulls have pushed up the market for 4 days but still cannot recover the loss that bears made in a single day.  Nevertheless the upward momentum is weakening, according to 8.0.3 Use n vs n Rule to Identify a Trend Change 2008 the market will seesaw and the game is buy dip and sell bounce.  However, bears will win more N vs N, which means it’s probably safer to sell bounce.  Keep an eye on INDU, according to 1.2.0 INDU Leads Market, if SPX breaks out 875 in the next week while INDU fails to make a higher high, that will be the third market topped signal after $NYA50R and $CPCE.


7.0.6 Weekly STO and the Market Top/Bottom.  Here is another evidence for seesaw – market will at least up and down for several weeks once weekly STO gives a sell signal at overbought level.


In the short term, I think the market will pullback on Monday, or as late as Tuesday.

T2103 from Telechart, Zweig Breadth Thrust is the primary reason why the market should pullback on Monday.  The overbought on T2103 seems very accurate so far.


Intraday Cumulative TICK from, the overbought of this indicator is also quite accurate, while we cannot rule out the possibility of further rally on Monday.  However, even the market does go up the upside movement will be limited according to the past patterns.


1.0.2 S&P 500 SPDRs (SPY 60 min).  Too many unfilled gaps, should the market gap up again on Monday, it could be an opportunity for short sell.


1.0.4 S&P 500 SPDRs (SPY 15 min), Bearish Rising Wedge plus lots of negative divergence.


In the intermediate term, the market is still overbought, and the negative divergence on the breadth signals are very obvious, this means a pullback is needed.

0.0.3 SPX Intermediate-term Trading Signals, 1.1.4 Nasdaq 100 Index Intermediate-term Trading Signals, overbought plus negative divergence.


SPY breadth from, again overbought plus negative divergence, it looks very bearish.


Lastly let’s take a look at 2.0.1 Volatility Index (Weekly), STO is turning up.



  1. As usual, very constructive TA and million cheers for keeping it updated every single trading sessions!

  2. Hi Cobra,

    Thanks again for you awesome job.

    Just curious, what do you think about EWT? Sometimes I check some blogs about it. Unfortunately it is so confusing. They flip their overview from one day to another.

    I'd rather prefer TA and you are really the SNAKE


  3. EWT requires lots of experiences that's all I can say.

  4. Here's a website on EWT that I follow often and recommend:

  5. ES future is not looking good tonight.

  6. Hi Cobra,

    If the S&P were to drift back towards 825 or so, in your opinion, at what level would you need to believe a bull trend has resumed versus a bounce that might break through towards 780-800? Thanks in advance for your insight.


  7. This slow and torturous topping action is the worst since May 2008. Now, since there is an even balance between bulls and bears, the actions will be news driven.

    I'm uneasy about the stress test news since that can create a huge melt up if goverment gives a rosy spin on that (what happened with the rumors that most banks are insolvent?).

    On the other hand the swine flu news seem to affect the markets negatively (big time it seems by the AM futures). Especially if travel plummets, oil will suffer a lot.

    Unfortunately, these are the things TA can do nothing about.

    I noticed that VIX hit the lower BB on weekly charts, just like mid May 2008. I'm hopefull with my short positions.

    One more thing: AAII bull/bear ratio just tipped last week. Good indicator of topping action since July 2007.

    It's good to see Cobra's TA aligning with my sentiment analysis. Sounds like some EW people are also rising top alarms, so 3 of 3.
    We will see as always.


  8. SPX CLOSEs above 875 and INDU also has a higher high would convince me that the uptrend will continue.

  9. SPX closed 857.51 uh oh. Too many insiders selling at top.



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