09/16/2010 Market Recap: Ascending Triangle

TREND MOMENTUM COMMENT Long-term 2 of 2 are SELL   Intermediate 3 of 3 are BUY 5 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in BUY mode. Short-term Model is BUY 6 of 6 are NEUTRAL The trend is up, I hold no long position overnight. GANN DAY MOON/SOLAR CYCLE CONCLUSION 9/21 09/23 / 09/23 Week of 09/24 Next pivot date: 09/21 – 09/23

BULLISH BEARISH 0.2.2 Extreme Put Call Ratio Watch: CPCI too high, topped? 0.2.5 NYSE Total Volume: Volume too low, topped? 6.4.6a QQQQ Black Bar Watch: Black bar, top is close? 6.4.4 SPY Price Volume Negative Divergence Watch: Price volume negative divergence. 1.0.6 SPY Unfilled Gaps: 17 unfilled gaps, the max was 18. *AAII is way too bullish.

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE. TRADING PLATFORM: SSO/SDS, UPRO/SPXU Non-Stop 09/07 L N/A ST Model

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

SHORT-TERM: STILL EXPECT PULLBACK, NOT SURE WHEN AS THE MARKET MAY STILL HAVE A FEW DAYS UP

Maintain the forecast mentioned in 09/13 Market Recap: Expect a pullback, but it may occur after a few days small up or consolidation.

The chart below so far fits for a few days of consolidation pattern I’ve been blah blah. Just a reminder: A breakout of a consolidation range could be on either side, so although it now looks a lot like a repeat of the August top but I cannot exclude the possibility of an upside breakout, so strictly speaking the short-term direction is not clear.

 

1.0.1 S&P 500 SPDRs (SPY 15 min), could be an Ascending Triangle in the forming plus seemingly very good responses toward RIMM and ORCL ER in AH, so maybe we’ll see the much waited huge up day tomorrow. If so, be careful bears, as a renewed up momentum usually won’t be just an one day wonder.

 

I’ve illustrated the chart below in 09/14 Market Recap. Tomorrow is another Fib 100% retracement in terms of trading days, so equally, I cannot exclude the possibility that tomorrow will be a top of some kind. No matter a top or huge up day tomorrow, the next pivot date will be in 09/21 to 09/23 time window which I’ll explain in the weekend report.

 

INTERMEDIATE-TERM: BULLISH, BUT HOW BULLISH IS TO BE REASSESSED

See 09/10 Market Recap for more details.

SEASONALITY: SEPTEMBER IS BEARISH, THE TRIPLE WITCHING FRIDAY IS BULLISH

See 09/03 Market Recap for September seasonality.

Also according to Stock Trader’s Almanac, the September Triple Witching, Dow up 5 straight and 6 of last 7.

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

	TREND	COMMENT – *New update. Click BLUE to see chart if link is not provided.
QQQQ	UP	4.1.1 Nasdaq 100 Index (Weekly): NDX to SPX ratio too high.
IWM	*LA
CHINA		Head and Shoulders Bottom in the forming?
EMERGING	*LA	4.1.6 iShares MSCI Emerging Markets (EEM Weekly): EEM to SPX ratio too high. *1.4.1 iShares MSCI Emerging Markets (EEM Daily): Hollow red bar again, looks toppy.
EUROPEAN	UP	Hollow red bar, pullback?
CANADA	LA	TOADV MA(10) too high. Hanging Man and Shooting Star and Hanging Man again, more pullback?
BOND	DOWN	*Breakdown below an important support.
EURO	UP	*Black bar, pullback?
GOLD	UP
GDX	*UP	4.3.1 Market Vectors Gold Miners (GDX Weekly): GDX to SPX ratio too high and Bearish Engulfing.
OIL	*DOWN
ENERGY	LA	2 Doji in a row, doesn’t look good.
FINANCIALS	*LA	4.4.2 Financials Select Sector SPDR (XLF Weekly): Head and Shoulders Top in the forming?
REITS	*LA	4.4.3 Real Estate iShares (IYR Weekly): Home builder is lagging and IYR to SPX ratio too high. 3.4.1 Real Estate iShares (IYR Daily): Hollow red bar, pullback?
MATERIALS	UP	2 hollow red bars in a row, pullback?

*LA = Lateral Trend.