01/19/2010 Market Recap: A New Consolidation Range

TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart) Long-term 3 of 3 are BUY     Intermediate 3 of 3 are BUY 4 of 6 are OVERBOUGHT SPY ST Model is in buy mode Short-term 1 of 1 are BUY 6 of 6 are neutral

BULLISH 4.1.0 S&P 500 Large Cap Index (Weekly):  H&S Bottom text book target is 1246. BEARISH 3.0.0 10Y T-Bill Yield: Top in a month? 8.1.0 Normalized NYTV: Topped? 4.0.4 Dow Theory: Averages Must Confirm: Multiple resistances and breadth very overbought. 1.0.2 S&P 500 SPDRs (SPY 60 min): 15 unfilled gaps.  0.0.3 SPX Intermediate-term Trading Signals: CPC and CPCE MA10 are too low. 2.3.4 Nasdaq Total Volume/NYSE Total Volume: Topped? 01/14 Market Recap: II and AAII survey show extremely high bull to bear ratio. 0.0.8 SPX:CPCE: *Top signal confirmed? 01/15 Market Recap: Climax Buying? CONCLUSION All the intermediate trend signals are up so no doubt the trend is up. But the bearish signs presented above are enough to raise a caution flag, so it maybe prudent to reduce some long positions.

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.) TRADING VEHICLE: SSO/SDS, UPRO/SPXU ST Model 12/21 L *01/05 Low *Adjust stop loss. Reversal Bar     NYMO Sell

OTHER ETFs COMMENT – *New update, they may not be mentioned in the report. Click links to see more details. IWM & QQQQ 8.2.9a QQQQ – 2009  - 8.2.9h QQQQ – 2002: Seasonality is bearish until the end of January. EMERGING 1.4.2 iShares MSCI Emerging Markets (EEM 30 min): Bullish Falling Wedge? FINANCIALS 3.5.0 Financials Select Sector SPDR (XLF Daily): Could be a Bull Flag in the forming. REITS 3.6.1 Real Estate iShares (IYR 30 min): *H&S Bottom breakout, target 47.38. OIL & ENERGY GOLD DOLLAR 3.1.0 US Dollar Index Bullish Fund (UUP Daily): *Filled black bar, could pullback. BOND 3.0.0 10Y T-Bill Yield: Could be a Bull Flag. So yield could rise while bond should fall.

INTERMEDIATE-TERM: LITTLE CRACK ON SOX AND TRAN BUT OVERALL IS OK

No update, keep eye on 4.0.3 Primary and Secondary Indices Divergence Watch, a little bit non confirmation on SOX and TRAN but not big enough to be a concern.

SHORT-TERM: A NEW CONSOLIDATION RANGE FORMED, DIRECTION IS UNKNOWN

No clear direction for the short-term. 0.0.3 SPX Intermediate-term Trading Signals, a small new consolidation pattern is formed, the breakout direction is unknown.

0.0.8 SPX:CPCE, hold trend line for the 2nd day so theoretically at least a short-term top is confirmed. Well, I’m not sure if we can trust this signal, let’s see tomorrow.

1.0.9 SPX Cycle Watch (60 min), looks like a cycle top too, if some extra bars delay are allowed. I’m not sure too. Again, let’s see tomorrow.

 

INTERESTING CHARTS: NONE