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Thursday, August 20, 2009

08/20/2009 Market Recap: Breadth showing a little bit more strength


Breadth picking up a little bit more strength today.

Still think this is sellable bounce as neither price nor volume were impressive.

  Trend Momentum Comments - Sample for using the trend table.
Long-term Up    
Intermediate Down Neutral Intermediate sell signals still need further confirmation.
Short-term Up* Neutral  
My Emotion Down    

Yesterday, I mentioned a newsletter I subscribed, think the pullback might be over as long as the market could up with strong breadth. The chart below shows the NYSE breadth today. The up volume to down volume ratio looks impressive to me, just the newsletter doesn’t have any update today, so I’m not sure in their eyes if this confirmed the pullback is over or not.


Personally, I still believe the pullback is not over yet, this is a sellable bounce. The reason is still that the price and volume are not impressive for those 3 days rebound. Again, SPX 1018 is the key, I won’t be convinced if, say, the market rises 5 days in a row and still couldn’t break above it.

7.7.9 Russell 3000 Dominant Price-Volume Relationships, for 3 days in a row, we have price up volume down as the dominant price-volume relationships which is quite bearish. This is my argument for “volume not impressive”. Well, bulls did a little bit better today as both price up volume down and price up volume up actually cancelled each other, therefore it’s neither bullish nor bearish.


7.1.0 Use n vs n Rule to Identify a Trend Change, down 2 days vs up 3 days, apparently bulls are weaker. This is my argument for “price not impressive”. In yesterday’s report, I quoted 2 past examples, here and here, both were breathtaking – one was up 5 days in a row and one was down 5 days in a row. From the comments I’ve got from this blog, I think someone didn’t get what I’m trying to say. Well, we'll see, maybe I’m wrong this time, but right now, I’ll stick to my setup.


1.0.4 S&P 500 SPDRs (SPY 15 min), 1.1.6 PowerShares QQQ Trust (QQQQ 15 min), Negative divergence plus possible Bearish Rising Wedge, so quite likely a pullback at least tomorrow morning.


2.8.0 SPX:CPCE, CPCE readings are now corrected. Just 0.51 is way too bullish, this is the main reason that I expect a red close tomorrow in the After Bell Quick Summary.



  1. Cocameister,
    If you are so correct on your analysis why don’t you put your analysis for short, medium and long term and let us see who accurate you are !!!
    Pls, don’t show your past performance, there is no way to verify that!!
    If you have guts put your for short, medium and long term analysis!!
    Lately, I haven’t seen anybody analysis is accurate…

  2. Sir Cocameister...
    Please, tone your competitive comments down. The purpose here is for learning and sharing observations. It is challenge enough for Cobra to put his work out for public consideration, day in and day out. It is completely unnecessary for him to respond to your 'challenges'. As with the hundreds of traders, invest some time and see what you can learn from his work; not how many points you might score in an effort to either measure or find fault or weakness. If you're a trader, then you know the power of humility and flexibility. To me keeping score is NOT the point, but finding value from the consistent effort and helpful charts he so tirelessly maintains.

    Thank you for considering this point of view. You're welcome here too. Make a great day!


  3. Sir Cocameister,
    What I can agree with, and upon further reading, appreciate about Cobra and others here, is that we are ALL trying to improve. And that I believe was your intent in your first message this evening; and thank you for that.

    If I may share one of our family traditions with you. When my wife drops a glass jar of honey by mistake in the kitchen, and it breaks and spills on the floor; she knows that within a few seconds someone else in the family will come and clean up the mess for her. She already feels badly for breaking the jar, making the mess and wasting the honey; so there's no need for her to get down on her hands and knees and clean things up too. There is no blame, no guilt and no shame in letting someone else in the family serve her that way.

    While not precisely on point, perhaps you might find some value in extending this exercise here, and elsewhere too. If you try it with your friends or family, you might be surprised at how very well it works to keep peace at home amid life's many 'mistakes'.


  4. I think this time n vs n is little tricky, if you look back in April, when markets where approaching the similar strong Fib resistance at 878 up3 vs d1 bears won, but slowly but surely it took 7 days to climb back up an break it. What do you think?

  5. This comment has been removed by the author.

  6. Look like we going have a 9th gap up!

  7. Cobra -- it is very interesting on chart 0.0.1 that the very bottom most indicator is below 50 which in the past has signified at TOP!!! Maybe we're close. I'm starting to scale into shorts starting today for the long term.

  8. Ivan, I agree, n vs n rule doesn't work all time. But there was a pullback during the slow up process where 2 vs 2 bulls won, that should be a enough warning.

    Ghh, thanks for understanding that I'm trying to improve. Cocameister has made his point, I take whatever is good.

    Anony at 8:45am, that below 50 indicator might or might not work, need more evidences.

  9. Tough game right now. Let's just survive opex and maybe we get some normalcy back that we can get a grip on. This manipulated crap is driving me nuts. I hate whipsawing indicators.

    Nice work as always. Have a good weekend.


  10. Dear Cobra,
    Do you know anythinga bout the cycle work by Steve Saweson.
    He is very good.

  11. May, I don't know his work yet. Thanks for the info, I'll check.



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