09/04/2009 Market Recap: Waiting for the show time

Cobra's Market View Private Messaging System shows:


Direction is unknown.

Lack of volume could be a problem, bearish if volume cannot pick up after the holiday.

Oil could rebound.

Review major bullish and bearish signals.

  Trend Momentum Comments - Sample for using the trend table.
Long-term Up    
Intermediate Down Neutral  
Short-term Up* Neutral  
My Emotion Wait   Could repeat what happened after 8/17, so be careful bears.

1.0.3 S&P 500 SPDRs (SPY 30 min), right closed below heavy resistance, no idea if it would breakout or fall back – need see how market unfolds the next week. Because the MACD on the bottom of the chart has switched to BUY so I upgraded short-term to up from down.


0.0.3 SPX Intermediate-term Trading Signals, 7.7.9 Russell 3000 Dominant Price-Volume Relationships, the biggest problem for the last 2 days’ rebound was “up on decreased volume”. The rebound after Aug 17 was too on decreased volume initially, so right now it’s hard to say if the decreased volume is a bearish sign. But if SPX is up the next Tuesday on yet another decreased volume, I’d be in the bear’s camp.


3.4.1 United States Oil Fund, LP (USO Daily), another hollow red bar which could mean that oil will rebound. This is good for the stock market.


Listed below are major bullish and bearish signals I’ve mentioned this week for your references. Personally, I feel that bearish signals are more convincing.

Bullish Signals:

 3.0.0 10Y T-Bill Yield, this worked perfectly so far recently.


6.2.0 VIX Trading Signals (ENV10), 6.2.2 VIX Trading Signals (BB), VIX buy setup had a pretty decent winning rate, but it just means a bullish short-term.


Bearish Signals:

6.4.0 SPX and NYMO Divergence Watch, at lest in the past the market all had a very big correction whenever NYMO was below zero while SPX just reached a new high. Will this time be different?


1.0.8 SPX Cycle Watch (Weekly), a turning cycle was due last week, a red week this week should have proved that in deed the market was topped. Also pay attention to the weekly NYSI at bottom, big black bar never went alone in the past, so most likely NYSI would have more big black bars ahead which means that the market will drop further.


Lastly, I’d like to correct 2 errors:

1.0.7 SPX Cycle Watch (Daily), because of a drawing problem, I treated the cycle turn as bullish. But since market was up on Friday which is the actual cycle due date, so now it’s difficult to say whether this cycle turn date is a bottom or top.


The ISEE index chart mentioned in  the After Bell Quick Summary has some errors – it didn’t mean a 100% green close next day. Chart 6.1.9 Extreme ISEE Index Readings Watch should be the final correct chart which had 2 cases failed in the past.


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