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Thursday, June 11, 2009

06/11/2009 Market Recap: Head-fake?


Expect at least a short-term pullback.

  Trend Momentum Comments - Sample for using the trend table.
Long-term Down   Idea for trading intermediate-term under primary down trend.
Intermediate Up Neutral  
Short-term Up Neutral  

For 5 days the market has stuck in a range. Although, officially the breakout direction is unknown but since the intraday breakout today failed to hold, which feels like a head-fake to me, therefore now I’m inclined to think that the real breakout direction will be on the downside.

0.0.2 SPY Short-term Trading Signals, 5 consecutive reversal like bars. In normal cases, 1 to 2 reversal bars are enough to lead a trend reversal. Now we have 5, if the “highly praised” candlestick pattern analysis is of a little little use, SPY should pullback soon.


2.0.0 Volatility Index (Daily), 2 “open low close high” reversal bars, VIX may rise from here which is not good for the stock market.


1.0.2 S&P 500 SPDRs (SPY 60 min), lots of negative divergences.


2.8.0 SPX:CPCE, whenever CPCE < 0.56, the next day was not very pleasant.


2.3.4 Nasdaq Total Volume/NYSE Total Volume, the normalized ratio at bottom is way too high. This chart may look strange but in reality, it’s a very reliable indicator which I don’t think should be neglected.


7.7.9 Russell 3000 Dominant Price-Volume Relationships, for 2 days in a row, we have bearish price volume relationships. I don’t think they should be neglected as well.



  1. Waah, ya don't think we can continue to high wave and dogi for the rest of the year? (kidding)

    great work, much appreciated as always

  2. Cobra,

    Great analysis as always; very methodical!

    What does the accumulation vs. distribution chart telling us? I suspect that we're already in the "final" distribution phase!


  3. Love your natvVSnytv. Time to load with some puts. Let's the party started.

  4. Richard, institutions are still in very slight accumulation. I'll post that chart once I see important changes.

  5. I thought that the VIX was priced daily, based on the numbers at the close of the market each day.

    How then are there intra-day highs and lows for it? Shouldn't it just look like a regular line graph wih points?

  6. Well, I guess we can throw that CPCE out the window! Printing press and FED is just too powerful!

  7. Not really, every chart is about percentage rate, there's no 100% guarantee. But if you short the market, you should have plenty of time to get out today. And at least CPCE saves bears from firework which was triggered yesterday when CPC < 0.8. So be happy what you've got.

  8. If not because of CPCE < 0.56 yesterday, today we'd see firework (which means the stock market skyrockets high).

  9. One comment re: chart 2.3.4 (natv:nytv). Highest reading ever on the free 3-year charts.

    Cobra, do you have long term charts of NATV:NYTV including 2003 for comparison? This is very interesting!

    PS: come back from vacation and surprized that markets and oil are holding on with dollar gaining. I wonder how much longer?


    But it's a normalized (MACD(10,200,1)). The absolute value has no meaning, as the raio at year 2003 was far lower than that of now.

  11. Cobra, many thanks for the chart. So, the current value of MACD at 0.4 is the highest since early 2001 and exceeded the peak in mid 2003.
    This agrees with my feeling that there is way too much optimism and faith in fast and painless recovery. The last couple of weeks were very trying but I stick to my bearish posture.



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