09/30/2009 Market Recap: SPX Swing Trade Model II Sell Signal


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Summary:

CPCE argues for an intermediate-term top again. Need follow-through tomorrow though.

SPX Swing Trade Model II Sell signal.

QQQQ black bar may mean a short-term top is very close.

  TREND MOMENTUM   COMMENT - Sample for using the trend table.
Long-term Up      
Intermediate Down* Neutral   Sell signal needs further confirm.
Short-term Down* Neutral    
SETUP DATE TRADE STOP LOSS Mechanic trading signals for reference only. Back tested since 2002.
SPX ST Model I 08/21 Buy next open 09/25 Low Win: 48%, Gain/Loss Ratio: 2.3, Ann Return/Trade: 58% yr
SPX ST Model II 09/29 Sell next open 09/29 High Win: 49%, Gain/Loss Ratio: 2.6, Ann Return/Trade: 74% yr
         

INTERMEDIATE-TERM: SELL SIGNAL TRIGGERED

0.0.3 SPX Intermediate-term Trading Signals, because both MACD and NYSI are on the short side, so I downgraded the intermediate-term to down from up。

2.8.0 SPX:CPCE, trend line broken, so this guy yells for a top again, needs hold the trend line at least tomorrow though.

CPCE

My SPX Swing Trade Model II issued a sell short signal today. Below is the back test summary since 2002. Well, it’s only a mechanical signal, back test worked good doesn’t guarantee it works in the future.

SPXSTModel2Summary SPXSTModel2

SHORT-TERM: COULD BE NOT FAR FROM A TOP

1.1.3 QQQQ Short-term Trading Signals, black bar means:

1. Gap down open tomorrow. No guarantee a red close though.

2. Not far from a short-term top. I see people are talking about a Symmetrical Triangle formed on 1.0.3 S&P 500 SPDRs (SPY 30 min). From the Elliott Wave point of view, this usually means a Wave 4, therefore there could be a Wave 5 to do the final push up. This doesn’t conflict with what the QQQQ black bar says, as it only says “close” to a top. From the QQQQ chart below, we can see that indeed there’re some cases that after a black bar, QQQQ made a new high before pulling back.

QQQQShortTerm SPY30min

INTERESTING CHARTS:

1.2.0 INDU Leads Market, INDU lower low before SPX may mean SPX will break below the Sep 25 low soon.

INDULeadsMarket

Today’s Russell 3000 Dominant Price-Volume Relationship is 1525 stocks price down volume up (I think Don Worden reported it wrong in his report today), this is a bearish reading. In the chart below I’ve marked all the recent cases that had similar “1500 stocks price down volume up” relationships.

PriceDownVolumeUp

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