Live Update

Wednesday, April 28, 2010

04/28/2010 Market Recap: VIX MA ENV Buy Setup

  TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)
Long-term 3 of 3 are BUY    
Intermediate 2 of 3 are BUY 3 of 5 are NEUTRAL Non-Stop Model is in BUY mode
Short-term 1 of 1 are SELL 5 of 6 are NEUTRAL SPY ST Model is in BUY mode
ATTENTION 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.
0.2.3 NYSE McClellan Oscillator: NYHGH new high could mean SPX new high ahead.
0.2.0 Volatility Index (Daily): Too high above MA ENV(10,20), also out of BB.
BEARISH 0.1.1 SPX Intermediate-term Trading Signals: CPCE MA(10) too low.
0.2.2 Extreme Put Call Ratio Watch: CPCE MA(5) 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.
CONCLUSION
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING VEHICLE:
SSO/SDS, UPRO/SPXU
ST Model *Long if SPY is up tomorrow. The stop loss will be 1.5 x ATR(10).
Reversal Bar *Long if SPY is up tomorrow. The stop loss will be 0.9 x ATR(10).
NYMO Sell    
Non-Stop    
VIX MA ENV     *Long if SPY tomorrow’s open < tomorrow’s close. The stop loss will be 1 x ATR(10).
OTHER ETFs TREND TRADE COMMENT – *New update. Click BLUE to see chart if link is not provided.
QQQQ UP   4.1.1 Nasdaq 100 Index (Weekly): BPNDX overbought and too high above MA(200).
IWM UP   4.1.2 Russell 2000 iShares (IWM Weekly): Too high above MA(200).
CHINA DOWN  
EMERGING DOWN   Bearish 1-2-3 formation, target $39.90.
CANADA UP  
BOND ?   Testing important resistance, will upgrade to up from down if breakout.
DOLLAR UP FXE breakdown to new low!
GOLD UP  
GDX UP  
OIL ? $WTIC tests MA(50) again, will downgrade to down from up if breakdown.
ENERGY UP  
FINANCIALS DOWN   4.4.2 Financials Select Sector SPDR (XLF Weekly): Too high above MA(200).
Bearish 1-2-3 formation, target $15.29.
REITS UP
MATERIALS UP    

*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: MOSTLY THE MONTH’S LAST TRADING WEEK WAS RED SINCE AUG 2009

See 04/23 Market Recap for more details.

CYCLE ANALYSIS: THE NEXT IMPORTANT DATE IS 05/06

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. See 04/16 Market Recap for more details.

INTERMEDIATE-TERM: EXPECT ROLLER COASTER AHEAD

See 04/26 Market Recap for more details.

SHORT-TERM: A FEW LONG SETUP NEED CONFIRMATION TOMORROW

From SPY daily chart, today is a typical consolidation day therefore the direction is unknown, need see tomorrow (see 8.0.1 Small Body Bar Trading Rule for why). However as discussed in 04/27 Market Recap, if the market repeats the past Major Distribution Day pattern, then the small green day today probably means that the market was bottomed.

MDD 

Of course, calling a market bottom for now is merely a speculation. For trading, we better have a good setup. And today we’re lucky to have one: 6.2.0a VIX Trading Signals (ENV), VIX dropped back into MA ENV(10, 20) triggering a potential long setup.

VIXENVSetup 

Below are the back test summary for the VIX MA ENV trading setup since 2002.

If wait until you’re sure that SPY tomorrow Open < tomorrow Close before entering a long position, the winning rate is 81%.

 VIXMAEnvSetupSummary

If buy at tomorrow’s open without waiting for a confirmation then the winning rate is 59%.

VIXMAEnvSetupSummary4NoConfirm

blog comments powered by Disqus

Disclaimer

The information contained on this website and from any communication related to the author’s blog and chartbook is for information purposes only. The chart analysis and the market recap do not hold out as providing any financial, legal, investment, or other advice. In addition, no suggestion or advice is offered regarding the nature, profitability, suitability, sustainability of any particular trading practice or investment strategy. The materials on this website do not constitute offer or advice and you should not rely on the information here to make or refrain from making any decision or take or refrain from taking any action. It is up to the visitors to make their own decisions, or to consult with a registered professional financial advisor.

This websites provides third-party websites for your convenience but the author does not endorse, approve, or certify the information on other websites, nor does the author take responsibility for a part or all materials on the third-party websites which are not maintained by the author.