9 May 2014

The market is currently sporting a bullish trend.  Not only did our intra-day chart turn bullish but our ST also turned up.  We should be aware that the norm now are whipsaw actions and the ST indicator could possibly lag, but it will eventually tell the true nature of the trend when it does break up or down of this sideways market.  Notice on the chart that the ST's have been clustering in a range.  This usually is followed by a clear trend move.

MT: UP
ST: UP
PA: UP

8 May 2014

Reiterating yesterdays post on the volatility and how we should expect this to be the norm for a while.  Hopefully though a resolve to the sideways pattern will soon be at hand.  The ST is still in a downward trend and the intra-day is in agreement of this.  Until that changes, I don't see why the downward trend can't continue.

MT: UP
ST: DOWN
PA: NA

7 May 2014

What a wild ride we got today.  The daily candle looks like a reversal candle, but that alone cannot be a gauge into a definite trend.  Volatility is getting to be a daily occurrence, and we should be prepared for these events.  For those long time bears, I do believe patience will pay off sooner than later.  As far as the market is concerned, we have not entered a full recessive market (too early to tell).  The ST still points downward, but if we don't see a whipsaw back down tomorrow, we might see a high possibility of a change in trend back up.

The 75 and 200 60min MA have been the supportive factor intra-day.  Once both MA slopes downward and price keeps distancing itself from the MA.  We will know that markets are in bad shape.

MT: UP
ST: DOWN
PA: NA

6 May 2014

ST has turned bearish.  But the pattern might still suggest a run up is still possible until the low made last week is taken out.  Ultimately our indicator will take priority, and will depend on the intra-day movements tomorrow.  Currently intra-day charts are in oversold territory and could still be that way throughout the day tomorrow. So watch for a rally to void this view.

MT: UP
ST: DOWN
PA: NA

5 May 2014

Markets are still overbought, meaning that upside risk is still high.  Today proved to be very volatile, and the daily candle reinforces the analysis of a bullish trend in the MT, ST.  Perhaps, prices are forming a ending diagonal (Wedged) pattern.

MT: UP
ST: UP
PA: UP

 

Diagonal???

 



2 May 2014

Weekly closed with a positive candle stick for the SPX and DOW.  Therefore, there is no conclusive trend forming as of the moment since last weeks bars were red.  The whipsaws are frustrating nonetheless.  Even as good a trader couldn't follow these whipsaws with consistency.  hopefully the 2 months worth of sideways movement will wane sooner than later.

The weekly supports and potential targets are ever changing.  This week those supports are:

1840.49 (20 WMA)
1785.54 Lower BB
1677.31 (75 WMA)
1432.47 (200 WMA)

These targets might be far off but its good to know where a major support lies in case of a abrupt move.  Often times also if a MA or Band is nearing a cluster of price support will we also see time and price meet.

For example,  the low of May-June of 2012 made a low in the range of 1275.  Not only was both 75WMA and Lower BB line within the range, but the price supports in 2011 specifically March and June of 2011 is also showing that a support in this range is highly likely.  Further studies can be made for the different MA like the 50, 90 or 100 WMA.  Since the 75 WMA is closing in on the 1700 area.  We should try to at least be open minded and look for major support here in a not so distant future.

On the current situation, we can see that another reversal candle formed on the daily chart (a bearish red candle).  This coupled with a diverging MACD should keep us on our toes or at least be aware of these potential signals.  The ST is still in overbought and risk of acceleration is to the upside.  We should keep any short trades back until we see a good confirmation that we are down-trending.  The ST would be a good indication of this.  Especially when it is out of overbought and in a down-trend.

MT: UP
ST: UP
PA: UP

The one thing I stress is that many of us have the urge to want to initiate or pull a trigger on a trade that we think might happen before our indicators cross or turn.  Discipline is the name of the game and although we won't get the top or the bottom, often times we can have high risk profit waiting for confirmation.

I don't write this to tell people or traders what they already know.  I write this to also remind myself of this rule from time to time.  Because I am my worst enemy...

1 May 2014

Happy May Day... First up then down then up.  By the end of the day prices pretty much closed just a tad below even.  Another doji and another day of indecision.  The ST is still overbought and this heightens the chance for an upward acceleration.  The intra-day chart however shows an exit of the overbought range and the bears would need this to sustain itself to the downside and push the ST into another downtrend.  Unfortunately, this sideways action have not been good for bulls or bears, and pretty much everyone is aching for markets to move regardless of the direction.  Clearly though, the 1880 - 1890 SPX range has been a strong resistance.

Right now the SPX is also forming a head and shoulder type pattern.  The daily MACD is at its second negative divergence since March 2014 and anything below the zero line would spell a bearish outlook like in Mid April 2014 and Late Jan. 2014.

MT: DOWN
ST: UP
PA: UP