Live Update

Thursday, June 4, 2009

06/04/2009 Market Recap: No Title


Still see some no good signs.

May pullback at least tomorrow morning.

  Trend Momentum Comments - Sample for using the trend table.
Long-term Down   Idea for trading intermediate-term under primary down trend.
Intermediate Up Neutral Some buy signals still need further confirmation.
Short-term Up Neutral  

Not much to say today, as long as the SPX 878 hold, the uptrend is intact, the game is then to “buy dip”. I still don’t want to bet heavily on the long side though, because:

1. The bond yield keeps rising which now attracts lots of attentions.

2. Semiconductor sector still lags. A little improved today though, but still is on “probation”.

3. From Institutional Buying and Selling Trending (Courtesy of, institutions are not heavily in accumulation as well (and so why we retailers?).



Not sure about tomorrow, probably a pullback at least in the morning.

1.1.5 PowerShares QQQ Trust (QQQQ 30 min), STO overbought plus a few negative divergences.


1.0.4 S&P 500 SPDRs (SPY 15 min), could be a Bearish Rising Wedge.



The following charts may need some attentions:

1.1.0 Nasdaq Composite (Daily), SOX is improved today, will keep watching on it.


3.0.0 10Y T-Bill Yield, Symmetrical Triangle, no good for the stock market if breakout on the upside.


5.3.0 Financials Select Sector SPDR (XLF Daily), Symmetrical Triangle too, good for the stock market if breakout on the upside.


6.1.0 Apple, Inc. (AAPL Daily), up 8 days in a row. Yes, technically, up 8 days in a row is not a reason for expecting a pullback, but if one stock rising for 8 straight days, would you buy it? Bet the most people would think the same way, so eventually this stock will pullback. And if so, it’s not good for QQQQ, as AAPL weights more than 10% in QQQQ holdings.


Seasonality from, the following 3 trading days are not very “bull friendly”.



  1. She she, she she ni! Many thanks Cobra,

    Looks like a bull flag on the TNX to me too,

    PIMPCO, I mean, PIMCO's head is saying the dollar is gonna tank (which means he's probably long)

    Short bets against the dollar are at record levels

    Rally is based on technicals, with an overemphasis on the 200MA... And CRE, Alt-A and Jumbo mortgages are the next big shoe ready to drop

    The list goes on and on... Too much to list here...

    And institutions? They are selling the rally.

    This isn't gonna be pretty... Unless you're short.

  2. Dave, I know, there're too many reasons for selling off, but simply the market is up and up and up. And such kind of madness has already caused a permanent mental damage to me. LOL

  3. Cobra,

    That accumulation/distribution chart. I assume the following:

    If market is up and accumulation is down = bearish.
    If market is up and distribution is down = bearish?
    If market is down/sideways and accumulation is up = bullish
    If market is down/sideways and distribution is up = bullish.

    What happens in the event of a combination?
    Like: Market is up, but accum = down AND distribution is down.
    Market is down, but accum is up AND distribution is up?

  4. Cobra,

    I feel your pain.

    However, the fundamentals *do not support* that this is the launching off point for a new bull market.

    When CRE begins to crumble, jumbos start defaulting, Option-ARMs start resetting, and there is no job growth, reality will set in.

    Personally, I think when the financial co.'s are done with their secondary stock offerings, the sell off will be breathtaking.

    Why? Because JPM, GS and others that have been pumping this market will attempt to get that pump money back by SHORTING it into oblivion.

  5. Market up, accum down, dist down = sideways.
    Market down, accum up, dist up = sideways.

  6. Cobra,

    Give this a read

    It will make you feel more sane.

  7. Kass predicts a 50 points drop for SPX next.

  8. Cobra,
    Could you comment on the impact of the rally from a deep discount on the 200DMA to at 200DMA or higher on the major indices. I know you ascribe importance to proportionality in markets. Could the markets exceed the 200DMA by some close percentage to the previous large disount?



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