Glass ceiling - 27 February 2012

In an analysis done in the late morning of Monday's trading, here is what I am seeing from the S&P500 futures (ES charts)...

The weekly chart (left) has perfected a Sell Setup and hit resistance outlined by July 2011 high. The past two weeks is basically a stall, rather than a pause, and the Force Index is hinting that the rally in recent weeks is not an accumulation phase. Given that the weekly price level is exceeding the maniac levels. This is the first warning that the next couple of months may see a good retracement/correction... now, we just need a reason to start it all rolling, something that should be within the next couple of weeks. (Watch Greece Lightning in mid-March!)
The daily chart (top right) is showing an obvious bearish divergence amid a stall. The daily chart close up (bottom panel) has a new Buy Setup that is just initiated, and needs to end below 1360 today to continue its reversal, making a breakdown of 1350 very highly probably this week.  It could well exhaustively break above 1360 and return through the range to breakdown as well. For now, the downside risk is much greater than 2 weeks ago.

I'd leave you with these words: CAUTION x 2

The MadScientist

27 February 2012

Note: ALL material posted here is from my personal opinion, and my opinion may differ or change without notice. These do NOT constitute as solicitation, investment nor financial advice. By reading the materials presented here, Readers acknowledge the awareness that the materials are intended for educational purposes only. For investment(s) advice, related decisions and/or actions pertaining to investments, always consult your own qualified financial advisors, brokers, etc.


Charts are from TD Ameritrade Thinkorswim platform

The day after Valentines - February 15, 2012

AH!
It seems that when you rock the boat so hard, you tend to be balancing for your dear life quite a bit.
And that is what has been happening to me for the past 2 months or so... it's not been an easy task to balance the extremes of life's journey, but I am glad I am doing ok for now.

I am looking forward to more refinement and streamlining to make things less technical, and more accurate in 2012. This would be in line with the other parts of my career that I am pursing.
I am good at what I do... and I want to be better!

So, what has been happening since the beginning of the year? A nice rally is what it is, if you missed it. Which is kinda tough to do as the rally has turned the tables on last August's rout... or has it?

Again, I find myself available to look at the charts, just before a decisive action is about to take place...


ES futures (S&P500 E-mini futures)

From the chart below, the year started with an impressive rally, and it turned the bearish outlook around having tested and failed to bread the weekly 200MA. The current rally, however, looks tired and near exhaustion. Recent high probability daily sell signals were voided and technical indicators were not too excitable following the mania in the prices just now. Notice that that candles are grey in colour? I am waiting for an impending sell signal, which should appear some time next week, perhaps after an exhaustion spike later this week, if at all. The charts are telling me something: CAUTION.

DX futures (USD futures)

The USD futures are longer term bearish, but weekly prices have been well supported. The daily chart clearly sprung a buy signal, which is suggestive of lower equities in the near term. What I do not see is the news that would spark this USD rally... not yet at least. Perhaps the Greek deadline of 25th March might be it, or the mess leading to the muddle through on 25th March 2012 will contribute?

VXX (VIX futures ETF)

Volatility had been falling well for the past 1.5 months, and the cycle is about to reverse. The weekly charts are stalling and the daily chart has buy signals. It appears to be a ripe time for an increase in volatility, and if so, this warns of an exhausted ES rally into correction phase.

TLT (Bond ETF)

Money hasn't really been pouring into the bond market since late last year. Daily moving average supports have been tested and buy signals given. This suggests a possible start of a bond rally if supports hold.

GC (Gold futures)

The gold futures weekly chart is at a downtrending channel resistance, with less than favourable candlesticks over the last 3 weeks. Weekly indicators look weak, and the daily chart has given sell signals with accompanying bearishly looking technical indicators.

Overall, while the longer term picture does seem a tad bullish, the immediate term is suggesting a bearish/corrective outlook. How this correction develops and its fundamental reason for correcting may set the backdrop for months to come. I'd be slightly bearish and very cautious as it is obvious that there is compelling confluence between the equity-USD-volatility-Gold-bond markets, all which point to a turning point and a decent correction in equities.

The MadScientist

15 February 2012

Note: ALL material posted here is from my personal opinion, and my opinion may differ or change without notice. These do NOT constitute as solicitation, investment nor financial advice. By reading the materials presented here, Readers acknowledge the awareness that the materials are intended for educational purposes only. For investment(s) advice, related decisions and/or actions pertaining to investments, always consult your own qualified financial advisors, brokers, etc.


Charts are from TD Ameritrade Thinkorswim platform

Dr Alexander Elder and a New Beginning - Market Analysis for February 13th 2012 by Singaporeseeds

Daily chart for S&P


Daily chart for Dow


Daily chart for NASDAQ


Market analysis for this week:
Went for an operation last Monday so didn’t have time to do my market analysis. Was having a hard time overcoming my Nosocomephobia. Thanks to my wife and both sides of my parents, I put my foot down and went for it. Finally got rid of my blocked and swollen nose that had plagued me for the past 7 years. It’s amazing how long I had dragged my feet on this one. I can now breathe properly and I enjoyed the first few nights of uninterrupted sleep in years.

This weekend, spent a weekend with Dr Alexander Elder learning directly from him. It was truly an insightful weekend. I will be incorporating what he taught into my trading systems over the next few weeks. So there may also be some changes to my market analysis over the next few weeks.

Anyway last week was a doji on S&P and Dow weekly charts. Daily charts looks like both S&P and Dow seems to be going for a correction. Nasdaq seems to be the only bullish indicator at the moment but I will not be surprised if there was also a correction especially since all 3 indexes had been rallying straight up since 2012.

I think we should see the start of a correction this Tuesday and it will continue into the week. Support at 1,270 on S&P.

Daily chart for the Dollar


Market analysis for this week:
The dollar should be looking for a bottom over the next few weeks. We may dip one more time before this downtrend reverses. Support at 77.2 on dollar futures.

Daily chart for Gold


Market analysis for this week:
The current rally in gold seems to have ended. We should see a dip this week to around 1,670 before the next leg up.

Daily chart for Crude Oil


Market analysis for this week:
Crude oil had been trading in a range since November 2011 with a number of false breakouts that never lasted more than a week. All this while, there’s a huge bearish divergence building in crude oil.
I believe the next movement in crude oil will be determined largely by the direction of the dollar. So I will be monitoring the dollar closely over the next few days.