04/22/2010 Market Recap: Bullish Reversal Day

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 5 are OVERBOUGHT Non-Stop Model is in BUY mode Short-term 1 of 1 are BUY 6 of 6 are NEUTRAL SPY ST Model is in BUY mode

ATTENTION 0.2.3 NYSE McClellan Oscillator: Negative divergence. *1.0.6 SPY Unfilled Gaps: 16 unfilled up gaps. (max was 18) 0.1.1 SPX Intermediate-term Trading Signals: Could be an Ascending Broadening Wedge in the forming. BULLISH 4.1.0 S&P 500 Large Cap Index (Weekly): Head and Shoulders Bottom, target 1246. BEARISH 0.1.1 SPX Intermediate-term Trading Signals: CPCE and CPC MA(10) too low. 4.0.4 Dow Theory: Averages Must Confirm: NYHILO too high. 4.1.0 S&P 500 Large Cap Index (Weekly): BPSPX too high. 8.1.5 Normalized CPCE: New record low. 04/14 Market Recap: Smart/dumb confidence spread at sentimentrader is too large. 04/14 Market Recap: Too many bearish extreme signals at sentimentrader. 0.0.2 Combined Intermediate-term Trading Signals: CPCE broke the trend line, so top confirmed? 6.2.3 VIX:VXV Trading Signals: A little bit too low. CONCLUSION 04/19 – If it’s the same post Major Distribution Day pattern then the market was bottomed.  Just with the put call ratio this extreme, I don’t know how the market is going to handle it? In wait and see mode.

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE. TRADING VEHICLE: SSO/SDS, UPRO/SPXU ST Model 02/26 L *04/19 low *Adjust stop loss. Reversal Bar *stopped out long position with loss. NYMO Sell 04/21 S 0.8xATR(10) Non-Stop     OTHER ETFs TREND   COMMENT – *New update. Click BLUE to see chart if link is not provided. QQQQ UP   4.1.1 Nasdaq 100 Index (Weekly): BPNDX too high. IWM UP   CHINA ?   Big red bar always led to more red days, so expect more pullbacks. EMERGING UP   Morning Star, so more rebound? CANADA UP   4.1.5 iShares CDN S&P/TSX 60 Index Fund (XIU.TO Weekly): BPTSX is too high. BOND DOWN   *Dark Cloud Cover near resistance, pullback? DOLLAR UP Head and Shoulders Bottom, target $24.28. 4.2.1 US Dollar Index Bullish Fund (UUP Weekly): Hollow red bar, rebound? GOLD UP   GDX UP   OIL UP *Bullish Reversal bar at MA(50), rebound? ENERGY UP   FINANCIALS UP   REITS UP MATERIALS UP   4.4.4 Materials Select Sector SPDR (XLB Weekly): BPMATE too high.

*Please make sure you understand how to use the table above. The main purpose of this report is to provide information so contradictory signals are always presented.

SEASONALITY: NO UPDATE 

CYCLE ANALYSIS: THE NEXT IMPORTANT DATE IS 05/06

See 04/16 Market Recap for more details. Please don’t read too much into cycle analysis, and I’m also not sure if the market will pullback from 04/20 (+-) to 05/06 (+-). All I know is that the next potential turn date is 05/06 (+-) which could either be a top or a bottom depending on how the market marches to that date.

INTERMEDIATE-TERM: EXPECT ROLLER COASTER AHEAD

See 04/16 Market Recap for more details.

SHORT-TERM: EXPECT MORE PUSH UP AHEAD

Today is a Bullish Reversal Day, see green arrows in the chart below for what happened after such kind of day. Generally when a day like today, gap down open < yesterday’s low, it’s usually a strong down trend day, if, however, in the end the market manages to close in green, from my experiences (also could be seen on chart below), such kind of day usually means more up days ahead.

 

1.0.0 S&P 500 SPDRs (SPY 60 min), could be a Symmetrical Triangle in the forming which according to the Elliott Wave theory usually means a wave 4, therefore it also says there at least could be one more push up ahead.

 

STOCK SCREENER:  For fun only, I may not actually trade the screeners. Since SPY ST Model is in BUY mode, only LONG candidates are listed. For back test details as well as how to confirm the entry and set stop loss please read HERE. Please make sure you understand the basic risk management HERE.

Looks like it’s too late to long stocks now as the market is way too overbought. Waiting for a better chance.