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Volumes for Major Markets and indices were mixed during the last few days, but higher than I expected.
QQQQ/SPY/DIA were going up with light volumes during the last few days.
Volatility - here comes - 5m - bounce.
With the intra and daily volatility that we have seen, just need to react during the intra day market actions.
At the resistances, i.e. QQQQ intra RST and SPX daily TL R, as you said, traders were waiting for BO or a pull-back, as you said.
Of course, it is to downside, my bias, with intra and daily negative divergences.
However, We need to be aware of the recent, higher volatility, hence, trading into close is to be considered.
Yes, a few of days ago, we had a data error to downside...
As of now, QQQQ is showing data error, the intra high as 44.97. The actual high is 44.55.
~~~~~~~
As noted, QQQQ traded to RST upper resistance and SPX traded to the upper TL.
Now, with the Eco news, market is rallying again as we know that markets use any news however it wants.
While price actions seem to be bullish, i.e. seasonal buying spree, the fundamental market condition is not.
Intra day shows negative divergences and on 60m.
~~~~~~~
From: QQQQtrend Replying To : ki (post 7959) Dec 4 2006 1:18PM
Title: QQQQ RST on 60m
QQQQ RST on 60m
~~~~~~~
From: QQQQtrend Replying To : QQQQtrend (post 96793) Dec 4 2006 10:00AM
Title: corr QQQQ Coil formation & SPX
SPX resistance at 1400 relative to Qs 44, but it is projected to make a new high to upper TL R.
QQQQ intra downtrend in tact, resistance at 44 and at 44.30 OE Pivot and last 4 days R.
~~~~~~~
From: QQQQtrend Replying To : QQQQtrend (post 96746) Dec 4 2006 9:57AM
Title: QQQQ Coil formation
QQQQ intra downtrend in tact, resistance at 44 and at 40.30 OE Pivot and last 4 days R.
From: QQQQtrend Dec 1 2006 3:47PM
Qs intra bounce at the low as shown on 60m chart forming double intra bottom while SPX is forming "Coil" formation.
Qs shows intra P.D.
~~~~~~~
From: QQQQtrend Replying To : QQQQtrend (post 96736) Nov 30 2006 10:23PM
Title: QQQQ & Market Comment
After softer economic news during PreMarket, markets traded down after the open, then found a support at an intra support as it bounced off during mid day as shown on intraday chart, for QQQQ 5m small rising wedge and a coil formation on 60m chart, recovering most of losses going into close, finishing the day unchanged. Market internal was fairly positive, A/D 1.80 and 1.14, since this would normally be a part of EOM action.
Bond market Treasury notes fell as 10yr closing at 4.46, the lowest level since Jan 06. Chicago purchasing mgt report was much weaker 49.9 vs 55 showing weak numbers across different categories. $USD again fell while Oil traded up which do not bode well for stock markets.
Home builders are upgraded today by BOA to neutral from cautious. As shown on HGX chart, it was trading up with "Price Channel" formation as it broke out of 2-wk consolidation, however, we need to see the final confirmation of breakout as it breaks above the upper channel TL. QQQQ As commented yesterday, it still didn't break above 44.20 area with confirmation which is the intra upper resistance. As stated above, it is forming a small rising wedge on 5m chart, hence, we need to look for a confirmation.
As anticipated, market is consolidating even though we saw an initial volatility on Monday setting up for a retracement which we are now seeing retracement of 61.80% of the Monday decline. My bias is to downside even though during the last four month, we saw the repetition of the same formation trading higher. However, be aware of many traders are projecting $SPX to make a new high from the Tuesday intra reversal.
Conclusion: We need to see a confirmation for directional bias since it remained in a tight range during the last three days.
Note) I signaled a buy at the Jun - July low, and now commented to take profit even though I do not have a ST top. Of course, for small investors/traders can exit markets anytime they want, big investors would have slowly exited their positions a while ago, as we can see through COT charts.
~~~~~~~
NASDAQ is also supported by the breakout TL, however, NASDAQ leadership is increasingly narrowed during the last several months as I noted negative divergences. We have a few big cap stocks are taking NASDAQ to higher which is showing more risk to downside. GOOG and AAPL were the leaders with MSFT trading higher with VISTA release news as I commented that MSFT VISTA release will help NASDAQ a few months ago. Now we have the VISTA release news with now analysts upgrades that we saw a week ago. AAPL is also upgraded today, trying to push market to higher, however, when the fund managers decide to take profit, many will try to exit at the same time. That will cause a faster momentum to downside. From Jun-Jul 06 bottom, 20% profit is a fairly good return for ST trading.
~~~~~~~
$SPX is showing strong momentum as it retraced 100% of Monday sell-off, however, it is showing negative divergences on 5/30m charts. Since Jun-Jul 06 bottom, it rallied about 20%, hence, taking profit will be a prudent decision even though I don't see a confirmation of a ST top. As we can see, we have increasingly negative divergences. It closed at 1400.
It seems that nearly 99% of market participants is sure of Dec to be up-month and 90% thinks that the rally will continue for the next few month.
Technical price actions - still in buying-spree.
Markets are hyped up again with the Eco data. Of course, market uses any news how it wants to use it. Now we have bubbled markets, except R.E. which is just getting busted.
Let's see how this market will close. Regardless the recent parabolic moves, market is playing out favorable seasonal buying spree, no fear, as well as the Fed does not care about making bubbles.
Option money, do you think, is with thefastmoney? They are pumping markets on CNBC.
Not sure where our country is heading to. OIL high, GOLD high, R.E. bust, Credit crunch... Liquidity pumping in, still rising interest rate to compensate for increasing invisible M3?
This scheme could be making babyboomer feeling good by raising interesting rate, if so, while pumping in invisible M3?
OE pivot? WB, yes, hope that market will pull back.
Mentioned OE pivot 44.30 earlier and it closed below the pivot. I thought of the reason that it closed at 44.26; then I see that it is the intra BO, but the intra formation looks to be hitting lower S of RST, hopefully.
But of course, when the resistance TLs are broken... all bets are off.
I think that RB is looking for ST top, at least. I know that he was fundamentally bearish all along which is a valid concern when we consider inflation/$USD.
Melt like Butter Blocks under HOT Blow Torch...
QQQQ & SPX GLEN, RST on 60m QQQQ and SPX upper TL resistance.
Bears must hold that TL resistances. Anticipated SPX to hit upper TL on daily. Also mentioned QQQQ 44.30 as OE pivot.
rainbow12345, welcome aboard. Wonderbuy is a nice moderator who is fair and intelligent like you.
It is certainly painful to be bears because market is driven by EOY performance buying-spree even if market could crash after the EOY when the hedge fund mgrs are getting out looking for volatility to downside.
Also, if this parabolic move continues, we could see a crash like we have see 1987 which is a typical outcome of market with new Fed chairman. We didn't see a real volalility after Dr Bernanke.
I am sorry for AEOS. That is the reason that I don't mention low volume stocks because it could swing wild. In addition, shorting strong momentum stocks, like AEOS, could be painful as I experienced before, for example, when I shorted Dollar Tree (DLTR) in late 2001, it was just going up.
Like you, bears could be riding a painful wave but anyone who has a right mind wouldn't be genuinely bullish at this juncture.
Having said that, while fundamentally bearish, we can’t ignore price actions based on technical analysis.
Hopefully, GB and the Fed has right mind, not to make bubbles.
Good luck and, again, Welcome aboard.
Hi GLEN, great points... just print more money and raise interest rate which is just more liquidity with net effect zero if the scenario is the best case. However, the fact is OIL price went up, while $$$ traded down.
Good to see you & Have a nice day.
RST... reverse symmetrical triangle on 60m, now, looking like it wants to form "W" which I hate to see it.
Thank you, Wonderbuy.
Good morning, wonderbuy, large trader who trades over 1000,
(for S&P 500 and individual Equity over 1,000 contract).
Wonderbuy,
Thank you for the link explanation and COT. Need to re-think on COT.
re COT, from CFTC
Open Interest - Open interest is the total of all futures and/or option contracts entered into and not yet offset by a transaction, by delivery, by exercise, etc. The aggregate of all long open interest is equal to the aggregate of all short open interest. Open interest held or controlled by a trader is referred to as that trader's position. For the COT Futures & Options Combined report, option open interest and traders' option positions are computed on a futures-equivalent basis using delta factors supplied by the exchanges. Long-call and short-put open interest are converted to long futures-equivalent open interest. Likewise, short-call and long-put open interest are converted to short futures-equivalent open interest. For example, a trader holding a long put position of 500 contracts with a delta factor of 0.50 is considered to be holding a short futures-equivalent position of 250 contracts. A trader's long and short futures-equivalent positions are added to the trader's long and short futures positions to give "combined-long" and "combined-short" positions.
Open interest, as reported to the Commission and as used in the COT report, does not include open futures contracts against which notices of deliveries have been stopped by a trader or issued by the clearing organization of an exchange.
Reportable Positions - Clearing members, futures commission merchants, and foreign brokers (collectively called "reporting firms") file daily reports with the Commission. Those reports show the futures and option positions of traders that hold positions above specific reporting levels set by CFTC regulations. (Current Commission reporting levels can also be found at the Commission’s website noted above.) If, at the daily market close, a reporting firm has a trader with a position at or above the Commission’s reporting level in any single futures month or option expiration, it reports that trader’s entire position in all futures and options expiration months in that commodity, regardless of size. The aggregate of all traders’ positions reported to the Commission usually represents 70 to 90 percent of the total open interest in any given market. From time to time, the Commission will raise or lower the reporting levels in specific markets to strike a balance between collecting sufficient information to oversee the markets and minimizing the reporting burden on the futures industry.
Commercial and Non-commercial Traders – When an individual reportable trader is identified to the Commission, the trader is classified either as "commercial" or "non-commercial." All of a trader's reported futures positions in a commodity are classified as commercial if the trader uses futures contracts in that particular commodity for hedging as defined in the Commission's regulations (1.3(z)). A trading entity generally gets classified as a "commercial" by filing a statement with the Commission (on CFTC Form 40) that it is commercially "...engaged in business activities hedged by the use of the futures or option markets." In order to ensure that traders are classified with accuracy and consistency, the Commission staff may exercise judgment in re-classifying a trader if it has additional information about the trader’s use of the markets.
A trader may be classified as a commercial in some commodities and as a non-commercial in other commodities. A single trading entity cannot be classified as both a commercial and non-commercial in the same commodity. Nonetheless, a multi-functional organization that has more than one trading entity may have each trading entity classified separately in a commodity. For example, a financial organization trading in financial futures may have a banking entity whose positions are classified as commercial and have a separate money-management entity whose positions are classified as non-commercial.
Nonreportable Positions - The long and short open interest shown as "Nonreportable Positions" are derived by subtracting total long and short "Reportable Positions" from the total open interest. Accordingly, for "Nonreportable Positions," the number of traders involved and the commercial/non-commercial classification of each trader are unknown.
Spreading - For the futures-only report, spreading measures the extent to which each non-commercial trader holds equal long and short futures positions. For the options-and-futures-combined report, spreading measures the extent to which each non-commercial trader holds equal combined-long and combined-short positions. For example, if a non-commercial trader in Eurodollar futures holds 2,000 long contracts and 1,500 short contracts, 500 contracts will appear in the "Long" category and 1,500 contracts will appear in the "Spreading" category. These figures do not include intermarket spreading, e.g., spreading Eurodollar futures against Treasury Note futures. [See a further explanation of "spreading" under the "Old and Other Futures" caption below.]
Changes in Commitments from Previous Reports - Changes represent the differences between the data for the current report date and the data published in the previous report.
Percent of Open Interest – Percents are calculated against the total open interest for the futures-only report and against the total futures-equivalent open interest for the options-and-futures-combined report. Percents less than 0.05 are shown as 0.0, and the percents may not add to exactly 100.0 due to rounding.
Number of Traders - To determine the total number of reportable traders in a market, a trader is counted only once regardless whether the trader appears in more than one category (non-commercial traders may be long or short only and may be spreading; commercial traders may be long and short). To determine the number of traders in each category, however, a trader is counted in each category in which the trader holds a position. Therefore, the sum of the numbers of traders in each category will often exceed the "Total" number of traders in that market.
Old and Other Futures (long form only) - For selected commodities where there is a well-defined marketing season or crop year, the COT data are broken down by "old" and "other" crop years. Table 1 (below) lists those commodities and the first and last futures of the marketing season or crop year. In order not to disclose positions in a single future near its expiration, on the first business day of the month of the last future in an "old" crop year, the data for that last future are combined with the data for the next crop year and are shown as "old" crop futures. For example, in CBOT wheat, where the first month of the crop year is July and the last month of the prior crop year is May, on May 3, 2004, positions in the May 2004 futures month were aggregated with positions in the July 2004 through May 2005 futures months and shown as "old" crop futures—positions in all subsequent wheat futures months were shown as "other."
For the "old" and "other" figures, spreading is calculated for equal long and short positions within a crop year. If a non-commercial trader holds a long position in an "old" crop-year future and an equal short position in an "other" crop-year future, the long position will be classified as "long-only" in the "old" crop year and the short position will be classified as "short-only" in the "other" crop year. In this example, in the "all" category, which considers each trader's positions without regard to crop year, that trader's positions will be classified as "spreading." For this reason, summing the "old" and "other" figures for long-only, for short-only, or for spreading will not necessarily equal the corresponding figure shown for "all" futures. Any differences result from traders that spread from an "old" crop-year future to an "other" crop-year future.
Concentration Ratios (long form only) - The report shows the percents of open interest held by the largest four and eight reportable traders, without regard to whether they are classified as commercial or non-commercial. The concentration ratios are shown with trader positions computed on a gross long and gross short basis and on a net long or net short basis. The "Net Position" ratios are computed after offsetting each trader’s equal long and short positions. Thus a reportable trader with relatively large, balanced long and short positions in a single market may be among the four and eight largest traders in both the gross long and gross short categories, but will probably not be included among the four and eight largest traders on a net basis.
WB, thank you, your comment is excellent even though I don't play options since your insight collaborates with mine.
Yes, it is scary for longs as IYC signals possible decline in stock market.
Could you tell me how I do links and hyper links on this board?
Also what is your opinion on COT?
http://www.trend-signals.com/Comments/2006/COT.htm
"Nov05 20000 vs Nov 06 550000"
COT shows that extremely large number of small speculators is buying the market since the mid October when we had the typical, favorable seasonality. Note the amount of small investor participation during Nov 05 vs Nov 06. Comparing to the last year, the small speculator buyers are extremely high, Nov05 20000 vs Nov 06 550000 which is 26 times more of small investors bought the market. There is no explanation of the large amount of small investors' participating during this year vs last year except that the real estate cash is transferring to stock market and that large cash was sitting on side line.
Commercials are increasing their hedge positions with large amount of Puts as shown on the chart. This suggests that commercials are also positioned themselves with large LONG position. When commercials and small speculators bought the market, there is no other to buy market; hence, this is often a contrarian indicator which is a sign of coming market decline.
Commented on Inverted Yield Curve on 11/20 as shown on this link http://www.trend-signals.com/Comments/2006/2006NOV.htm
As shown on the IYC chart, Bond market was telegraphing weaker economy than financial market was projecting. I have commented on this during the last several months including projecting "Stoping Rate hike" in Aug 06 Fed meeting. But as we see, even after the recent rally, it seems that it is better to go through normal economic cycle which is a moderate recession than pretending we are in brand new economic cycle with "soft landing" scenario.
My view, now, is that "recession" in normal economic cycle is a good thing instead of creating bubbles.
As you said, we could see a rate cut on Dec 12 fed meeting as Bond market has already priced in.
As you can see, 10y broke lower uptrend line but at a support.
Thanks, WB, I need to revisit the topic that you commented on since the last time that I made comment http://www.trend-signals.com/Comments/analysis/MarketEconomicCycles060831.htm
and adjust based on what I observed.
To summarize what you pointed out and what I commented on is the difference between "Soft Landing" and "Hard Landing". Hence, while I know how to reconcile the differences, I will need to revisit the subject.
I commented on the previous post: http://www.investorshub.com/boards/read_msg.asp?message_id=15238838 and these are the charts.
Sector iShare & Big cap: The recent AAPL upgrade is certainly to boost the general market action as well as upgrading MSFT a week ago.
While GOOG is retrieved from $500 resistance, 60m intra shows Positive D. at 200ma S.
ORCL positive D at major support on 60m.
AMGN underperformed as we have seen $BKX retracement after election, but it is also closed at a support.
QCOM formed symmetrical triangle on daily after the recent sharp retracement; hence need to confirm.
In conclusion, intraday shows positive D. even though major market momentum is decreasing with negative D; so, again we need confirmation.
WB, can you tell me whether you can see charts on this page?
http://www.trend-signals.com/Comments/2006/QQQQ06Dec.htm
Best Wishes
Sector iShare & Big cap: The recent AAPL upgrade is certainly to boost the general market action as well as upgrading MSFT a week ago.
While GOOG is retrieved from $500 resistance, 60m intra shows Positive D. at 200ma S.
ORCL positive D at major support on 60m.
AMGN underperformed because of $BKX after election, but it is also closed at a support.
QCOM formed symmetrical triangle on daily after the recent sharp retracement; hence need to confirm.
In conclusion, intraday shows positive D. even though major market momentum is decreasing with negative D; so, again we need confirmation.
This is my iShare sector comment. Best Wishes
~~~~
http://www.trend-signals.com/Comments/Sectors/SiShare061201.htm
Since mid Jun, the best performing sector was energy sector, 7.17% while the worst one was Industrial, -6.23%. The other sectors' performance were Utility 3.96%, Material 3.36%, Technology 3.8%, Consumer Discretionary 2.14%, Financial -.06%, and Consumer Staples -4.96%. These iShare performances are not necessarily in sync with corresponding industries or sectors. For example, while Oil ($WTIC) has traded down during the last few months, Energy iShare is traded up. Chart:$WTIC wkly XLE
XLB, material, is showing strong momentum since Jun 06 bottom as it broke above the Jul-Sep top resistance in Oct. It is now showing negative divergence on daily and weekly with slowing momentum as the same with the general market direction.
XLE, energy, is showing strong momentum to upside as those broke above the Jul/Aug 06 high with negative divergences both on daily and weekly.
XLF, financial, is trading in a relatively defined range during the last two months as with XLP for three months. XLF is closed at the two months support TL, hence, need to watch the support TL at 50ma. The XLP, consumer staples, formation is symmetrical triangle; hence, hence, we will soon see a break to either side from 25-26 trading range.
XLV, health care, broke TL support and now it is closed at the TL resistance. Trading above the current TL resistance favors retracing to the top, however, as we can see on weekly, it is overbought hence, prudent to take profit.
XLY, consumer discretionary, has performed very well during the recent rally, and now, it is consolidating at the top while weekly momentum is declining. During the last 30 trading days, AMZN 21%, COH 20.87%, KBH 19.44% were the best performing stocks; even though AMZN is recently pulled back closing at the recent breakout support.
In conclusion, SP500 iShare is relatively following general market direction based on my observation of the last five months performance, i.e. All buying signals during Jun-Jul bottoming process; hence, need to be aware of major market direction and to keep in mind that XLY formed sym triangle which will break out soon.
Hi rab120,
Thank you for your kind address.
I commented on the same Mid Term Election pattern (MTEP) during the last few months when I commented on the "Seasonality" when I stated that we would not likely see the typical MTEP as shown on the MTEP chart, a sharp pull back during mid year.
As we now see that we indeed didn't see the typical MTEP mid year pull back. The following links are some of my comments relating to the seasonality. The first link shows the result of the YTD which is relating to the answer to COD which you posted.
These analysis are well-known and common analysis for those who are commenting on the financial markets.
http://www.trend-signals.com/Comments/2006/2006NOV.htm ( at the bottom)
http://clearstation.etrade.com/cgi-bin/bbs?post_id=7783290
http://www.trend-signals.com/Comments/analysis/Midterm.htm
http://www.trend-signals.com/Comments/2006/2006Aug1_5.htm
With regard to your first posting, "I don't know Who is Who",
http://www.investorshub.com/boards/read_msg.asp?message_id=15065401
as shown on this link, I only posted with this alias on iHub board. Others are impostors of my alias.
Thank you for your understanding and have a nice weekend,
Best Wishes
WB, Qs formed small coil formation on 5m and a triangle on 60m while supported by mid TL on daily after retracing 61.8% of the Monday sell-off. Hence, as you said, we should get a directional confirmation during the next couple of days as you said.
It is showing positive divergence on 60m which is not a good news for bearish bias even though we have consistent negative divergences on daily/weekly showing slowing upside momentum after rallying 15-20% from the Jun-Jul low.
Not sure what you are saying re OEPM? Just kidding? But as I observed it during the last couple of years, it is helpful, maybe I will include a comment on the subject as I do market comment, just need to find more time.
wrt $HGX, my favorite housing stock is TOL, DHI and KBH -- i.e. bigger volume -- with a note that the housing index and individual stocks are not always in sync, as you know.
greenstreet mentioned $HGX.
Please do inform me your approach and favorite stocks or sectors.
Have a nice weekend,
Best Wishes
Hi Greenstreet, QID shows high volumes during the last few days. Of course, QID is a contra of QQQQ, so when we think that Qs has the top, we can go long with QID.
What do you think?
Have a nice weekend,
Best Wishes
HGX and OSX are breaking out, but still under the upper resistances; so we need to see it break above.
HGX was bouncing off while NHB was making new lows suggesting that market thinks that housing is bottomed. Of course, that could be just hype to get fast money return, but we will see whether housing market is indeed bottomed. It will take longer than one year cycle to get housing bubble washed out. However, we need to go with what prices are telling us, of course.
Qs Trendline support is visible as you also noted. It bounced off from the lower TL support as shown on the 60m chart with intra P.D.... not good for bearish bias.
We had good intra day volatility during this week as if this was option week.
Have you ever check this page? OEPM strat looks quite fundamental, but it works when use it appropriately.
http://www.trend-signals.com/MM/OEPMconcept.htm
Right now, QQQQ, SPY, DIA are all trading below pivot which is the close price of OE Friday which is favoring down-side momo. Of course this could change when it all climbs above it.
Don't agree on hyping up markets to SPX 1450 because it is just causing massive crisis as more bubbles are created. Do you have bull/bear bias?
Have a nice weekend,
Best Wishes
USD & OIL, Wonderbuy, OIL and USD traded up today. XLE traded up again above the break out.
I hope that you had a good day.
Best Wishes...
$HGX & QQQQ, Hi Greenstreet, $HGX is upgraded today. I hope that you had a good day.
This is my market thoughts.
Best Wishes.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
After softer economic news during PreMarket, markets traded down after the open, then found a support at an intra support as it bounced off during mid day as shown on intraday chart, for QQQQ 5m small rising wedge and a coil formation on 60m chart, recovering most of losses going into close, finishing the day unchanged. Market internal was fairly positive, A/D 1.80 and 1.14, since this would normally be a part of EOM action.
Bond market Treasury notes fell as 10yr closing at 4.46, the lowest level since Jan 06. Chicago purchasing mgt report was much weaker 49.9 vs 55 showing weak numbers across different categories. $USD again fell while Oil traded up which do not bode well for stock markets.
Home builders are upgraded today by BOA to neutral from cautious. As shown on HGX chart, it was trading up with "Price Channel" formation as it broke out of 2-wk consolidation, however, we need to see the final confirmation of breakout as it breaks above the upper channel TL. QQQQ As commented yesterday, it still didn't break above 44.20 area with confirmation which is the intra upper resistance. As stated above, it is forming a small rising wedge on 5m chart, hence, we need to look for a confirmation.
http://stockcharts.com/c-sc/sc?s=$HGX&p=D&yr=0&mn=9&dy=0&i=p42425454012&a=90...
As anticipated, market is consolidating even though we saw an initial volatility on Monday setting up for a retracement which we are now seeing retracement of 61.80% of the Monday decline. My bias is to downside even though during the last four month, we saw the repetition of the same formation trading higher. However, be aware of many traders are projecting $SPX to make a new high from the Tuesday intra reversal.
Conclusion: We need to see a confirmation for directional bias since it remained in a tight range during the last three days.
Note) I signaled a buy at the Jun - July low, and now commented to take profit even though I do not have a ST top. Of course, for small investors/traders can exit markets anytime they want, big investors would have slowly exited their positions a while ago, as we can see through COT charts.
http://www.trend-signals.com/Comments/2006/2006NOV.htm
NASDAQ is also supported by the breakout TL, however, NASDAQ leadership is increasingly narrowed during the last several months as I noted negative divergences. We have a few big cap stocks are taking NASDAQ to higher which is showing more risk to downside. GOOG and AAPL were the leaders with MSFT trading higher with VISTA release news as I commented that MSFT VISTA release will help NASDAQ a few months ago. Now we have the VISTA release news with now analysts upgrades that we saw a week ago. AAPL is also upgraded today, trying to push market to higher, however, when the fund managers decide to take profit, many will try to exit at the same time. That will cause a faster momentum to downside. From Jun-Jul 06 bottom, 20% profit is a fairly good return for ST trading.
XEU: WB, this is an informative post for readers. Euro is rallying against USD again.
My comment on the previous post in part related to this post.
GM, Wonderbuy, yesterday I tried to post the following as a reply to your post, but it wasn't working, so here it is.
Have a good day.
USD & EOM, yes, we could see the pattern during the last few months. It seems that SM (smart money) is taking profit just before the EOM so that they know that the EOM market psychology will buy the dips; hence, no technical damage will occur. Even though EOM pattern does not work in 100% of the time, it certain repeats itself often enough.
Dollar and Oil are contra-markets, so as USD breaks down OIL would break out. You quoted a very good article on USD. These are USD charts which are showing the break down. This will cause some crisis. Some would sell the financial market while others could buy US markets since they could buy at lower prices with lower USD.
Anyhow, I am not a proponent of Financial trading higher at this point.
My previous comment on USD.
"$USD is breaking down while Energy is breaking out as shown on the $NATGAS and $XLE. Of course $CRB would be breaking out since Oil is heavily weighted. When we consider the relationship among $USD, $WTIC and $SPX, we would not have 1995 bubble up scenario. With the value of our currency and the amount of debt we have, I do not think that we will repeat the 1995 scenario where $SPX traded up at the same time when $USD traded up. So, $USD is devalued as well as our stock market meaning that our currency is getting worthless if we continue to bubble up financial market.
We need to watch USD carefully since it will impact oil price and also foreigners’ investment. Some would be losing money by investing US stock market, but others would start to buy US Stocks because it is cheaper to buy with lower USD? This sounds chaos to me when we think about cascading effect of bubble collapses.
The problems get to a climax at some point and we need to take a serious measure to correct the problems like what we are having and what we have seen here, as an example.
I hope that we are not creating another bubble. You, I and others will live through to see what market will do whether it will create another huge bubble or Dr Bernanke is sober enough. Sure, Pres Bush will leave legacy…. Of… He didn’t create 1995-2000 bubble which he lived through the consequences."
Future Bubble Maker (FBM): Good morning, greenstreet.
Future Bubbler is projecting $SPX making a new high. Unless sober Fed acts on no-bubble proponent mind, market will follow FBM.
XHB is trading near resistance.
Cycles: It seems that the comment is similar as what I was saying if you have read it. My comments and charts are:
http://www.trend-signals.com/Comments/analysis/4yrCycle.htm
Also, on other pages, I think, but my conclusion was based on the volatility analysis and cyclical pattern which I commented during Jun-Jul 06 bottoming process.
What are your thoughts on cycle analysis?
Will need to find the time to get back on the subject.
Btw, do you have any bull/bear bias to major market direction?
Happy Holidays & Best Wishes
Market Comment: Hi Wonderbuy, Certainly market is favoring EOM actions. I hope you had a great day.
QQQQ As commented yesterday, market traded higher to the resistance targets which I stated 44 and 44.22 area. As shown on the 60m chart, it bounced off from the lower TL support and was consolidating at the mid point where a TL and ma resistances are. As oil price going up (Jan07 +1.46), market swing down during the mid day, but found the intra support at 43.66 which is a continuation of consolidation from yesterday in a coil formation. As anxious buyers support the markets to float during holiday season, markets bounce at the support and traded higher into close. It is trading at Weekly upper TL Price channel which I noted during Jun-Jul 06, but now markets are certainly over extended.
In summary, Market was in a consolidation same as yesterday; however, it retraced 50% of the Monday decline.
$SPX also bounced off from the lower TL support as shown on the 60m chart. It also showing, as noted yesterday, a continuation of the recent trend even though we can see negative divergences on Daily CMF. Obviously, higher price action goes, more risk is assigned to downside. As indicated on CMF N.D., certainly less money inflow into the market.
Note) Granted that the markets are waiting for retail/small investor investors to buy the market as they follow the seasonality and as smart money slowly distributes to them. I noted this during Jun-Jul bottom that too many shorts in the market which will be squeezed, but the smart money was buying the market at that time; but, it is apparent that the smart money is distributing which can be seen on COT charts showing high volume of small investors.
DOW has bounced off from the TL support as shown on the daily chart. Even with weakening momentum and negative divergences, price action shows no sign of trendline break. No confirmation sign of a TOP formation even though we have enough of warning signals.
NASDAQ also bounced off from TL support as it bounced off from the CCI mid line (ZLR).
Certainly, "Seasonality" trumpted today as buyers stepped at the critical supports. Of course, we all know that there are trillions of small investors money to be shifted from one hand to others. Also, the "EOM window dressing" favored market as well, i.e. typically 3 - 5 days during end of month into the first of the next month.
XLE: Hi greenstreet, Great Call today.
XLE seems to be breaking out even though the previous pattern shows the breakout needs to be confirmed. Your call followed by the inra day action was Excellent.
Do you closely monitor Sectors?
OIL w XLE - $BPENER - $OSX - CHK - VLO
OIL
Hi rab120, Thank you for your pleasant remark.
I wish you "Happy Holidays" and your trading to be fun and profitable.
Best Wishes
QQQQ: Wonderbuy, good call on Q support 43.36 which is a holygrail dma, and also a breakout support on daily.
Glad to hear that you had a 50% gain on your option play which you told me yesterday.
Qs is still on uptrend line, no confirmation for a ST top. Month-end and 1st of month market up favors the bounce from the yesterday sell-off as markets consolidated today.
However, I see, Breadth Warning Signs for a pull back as I commented before. I also mentioned favorable Seasonality, but let's not trust seasonality as I said the same thing during Summer and Sept/Oct for NOT-as-usual-Seasonality market price actions.
Qs shows intra - daily negative divergences confirming breadth negative divergences across major market internal.
Q resistances, 44 - 44.22 on intra day charts.
As you see, all daily charts' indicators are showing, breaking up trend, e.g. MACD; hence, add more warning for a pull back.
Best Wishes
8yr & 4yr Cycles: Good morning, the cycle analysis is still challenging because it is a fluid analysis which one needs to readjust timelines since it is never a precise projection. When I find time, I need to get back to the subject.
This is my reply which I quote again when you initiated the cycle discussion to me on Sept 17, 2006.
First Draft on combining 4yr - 8.6yr Global Business Cycle:
When considering 4yr-8.6yr Economic Confidence Model cycles, we likely have seen the 4yr cycle bottom during Jun-Jul 2006 bottoming process.
As I have shown various charts with 4 yr cycle on my previous posts, the projected timeline is Oct2006, however, considering the high volatility and extremely negative sentiment as noted “Climactic” sell off on VIX breakout charts.
As you can see on the SPX LT chart with 4yr projected timelines (blue) vs actual bottom (magenta) lines, the formation is irregular even though we can identify the 8.6 cycle repetition during the last 20 yrs as noted by “Economic Confidence Mode (ECM)l” overlay on the SPX chart. The ECM bottoms are coincide with the major lows that we had during the last 20 years., i.e. 1985 (1987) bottom, 1994 bottom, and 2002 bottom; hence, we can give due-credibility to the model since the original date is 1997 which projected the relative highs and lows during the last 10 years since the ECM was introduced. We are yet to see the 2002-2011 cycle replication of the ECM, hence, the purpose of this analysis.
The high targets that we have seen for this run up could be the high for the middle peak shown on the 2002-2011 H&S. (to be continued)
~~~~~~~~~
As you know, Cycles are not precise, so need to reconsider and modify my thinking as I observe "breakout", "level of retracement", "failure of breakout", etc. from this price level.
Of course, my anticipation is markets are going to breakout from the current resistances.
Will post more thoughts later. This is just a quick thought even though I was pondering about this particular model combination before.
First Draft on combining 4yr - 8.6yr Global Business Cycle:
When considering 4yr-8.6yr Economic Confidence Model cycles, we likely have seen the 4yr cycle bottom during Jun-Jul 2006 bottoming process.
As I have shown various charts with 4 yr cycle on my previous posts, the projected timeline is Oct2006, however, considering the high volatility and extremely negative sentiment as noted “Climactic” sell off on VIX breakout charts.
As you can see on the SPX LT chart with 4yr projected timelines (blue) vs actual bottom (magenta) lines, the formation is irregular even though we can identify the 8.6 cycle repetition during the last 20 yrs as noted by “Economic Confidence Mode (ECM)l” overlay on the SPX chart. The ECM bottoms are coincide with the major lows that we had during the last 20 years., i.e. 1985 (1987) bottom, 1994 bottom, and 2002 bottom; hence, we can give due-credibility to the model since the original date is 1997 which projected the relative highs and lows during the last 10 years since the ECM was introduced. We are yet to see the 2002-2011 cycle replication of the ECM, hence, the purpose of this analysis.
The high targets that we have seen for this run up could be the high for the middle peak shown on the 2002-2011 H&S. (to be continued)
~~~~~~~~~
As you know, Cycles are not precise, so need to reconsider and modify my thinking as I observe "breakout", "level of retracement", "failure of breakout", etc. from this price level.
Of course, my anticipation is markets are going to breakout from the current resistances.
Will post more thoughts later. This is just a quick thought even though I was pondering about this particular model combination before.
The link below is my chart analysis which I posted on my personal trading website.
http://www.trend-signals.com/Comments/2006/SPXLT060804.htm
Durable Goods Orders
8:30 ET
Redbook
8:55 ET
Consumer Confidence
10:00 ET
Existing Home Sales
10:00 ET
After Durable Good Orders number, future is trading down. Consumer Confidence number will also likely move markets.
Have a great day,
Best Wishes
Dollar & OIL: Yes, it is the intraday support as shown on the 60m chart. I will be carefully observing tomorrow price actions.
Also, I commented on OIL $55 as a meaningful support since Jul 06 high near $80 when I noted the LT resistance. Since then, Oil traded to my target $55 during the last option expiration Friday which noted on CS and now Oil bounced from the $55 Support area and traded higher.
Also, as we have noted, DOLLAR was falling dramatically since last week and it was again trading down today, to below the support as shown on the daily chart. Hence as commented, the falling dollar, rising oil price, and WMT sale news prompted the profit taking sell off that we were looking for. This is healthy price action since we didn't have a meaningful pull back since Jun-Jul 2006 bottom which is almost 20% rally. Btw, I called the Jun-Jul 2006 bottom on CS while all other posters disagreed, that is the reason that they are all upset. But I noticed that you saw the same as what I saw.
Thank you
Best Wishes
QQQQ: Hi Wonderbuy, as we discussed a pull back during the last few days, we have seen a first meaningful correction day, a Reversal Day, which I was looking for a confirmation since my market pull back warning posts during the last week. While I will examine today's market action, the volume and magnitude of profit taking certainly fits "Confirmation" for pull-back characteristics, i.e. A/D was negative 1:4, high volume sell-off, up to 2.5% sell off.
As shown on 60m QQQQ chart, market has retrieved from the upper resistance, closing at the lower TL. As we discussed, market is certainly due for a meaningful pull back. More to follow...
I am not sure how everything will work out and where to post our market comments in the future, but I hope that it is alright with you that we post our market comments here as greenstreet stated. We will be flexible as to following rules and guidelines, so please, inform me when you would like to any time either on the board or by sending me emails.
Thank you again for your understanding and for your patience.
Best Wishes
SPX: Thank you, greenstreet for your support and encouragement. I have noted, as you have, a warning signal for a meaningful correction after the rally since my Jun-Jul 06 bottom call which I reposted below as references from the confirmation emails that I have.
As shown on the SPX 60m chart, market has retrieved from the upper resistance. Wonderbuy and I were discussing a pull back as we have on CS board, but the sharp correction that I have seen today is certainly sooner than we anticipated. Market closed at the low into close and near the lower TL support as shown on the 60m chart. I will be observing a follow-up day tomorrow and reassess the reversal day which we have seen today.
Thank you again for your support, and please repost your thought if you could.
Best Wishes
--------------------------------------------------------------
Nov 20 2006 12:24PM
Title: BEARISH after 20% Gains since Jun-Jul Bottom Call
20% Gains since Jun-Jul Bottom Call:
We have 10-15% YTD market performance and about 20% gain since Jun-Jul 2006 Bottom call.
Those who were missing out the mid year bottom are pushing markets higher for their EOY performance. This is unstable market price actions which need to take the nature of parabolic price actions carefully, in order to avoid disaster!
--------------------------------------------------------------
Jun 19 2006 7:58AM
Title: re SPX Trendlines & SPX 1350 +/-
The SPX target for the recent run is as shown on the chart, SPX 1350 +/- area which is upper trendline as shown on the weekly chart.
Wonderbuy, OT
re: Technical confirmation
This post is to explain reasons for my hesitant replies in the future. Maybe this will be deleted by you, but I need to explain the situation. As quoted below, a poster, argos, who attacked me is again posting a slander on CS board. I don't want to turn your board into where Off-topic will be posted more than once.
I would like to note that I am stunned by slanders and offensive posts by some posters against me on CS boards.
As I repeatedly stated, my background is financial with a graduate degree with x-CPA as well as I have accurately called market turns since July 2004 as I decided to participate on public discussions on CS.
Those who disrespectful of my comments are reported to get some help. Meanwhile, some posters on CS are already slandering against me including kenwong's previous accusation that I ever posted on iHub board other than this alias.
I am thankful for your understanding and am going to be focusing other issues. Meanwhile, I wish you the best and will try to participate, but please understand that I am taking it slow. Spending 1000s hours of providing market comments and seeing such offensive attack on CS boards needs to be taken care of.
Best wishes to you
========================================================
From: argos Replying To : attendiez (post 98615) Nov 25 2006 9:27PM
Title: ihub
Sharon has moved to ihub and I hope she behaves there. In between rants, she did provide some decent T/A. Although, some have disagreed as to whether or not the analysis was indeed hers.
NASI H&S looks reasonable since other breadth negative divergences favor a correction as I noted before.
I am looking for a confirmation for a meaningful correction, but as you also noted because of seasonality, a consolidation period would be likely.
Even though we speculate, we need a technical confirmation.
With regard to the mistake that I mentioned on previous post, I was talking about thoroughly understanding iHub environment. Right now, I think that I will focus on other things. Will continue to keep you informed.
Best Wishes