10/26/2009 Market Recap: VIX Surge


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Summary:

CPCE argues for an intermediate-term top again, need hold the trend line to confirm through.

Bears may need to take profits if further drop tomorrow.

  TREND MOMENTUM EMOTION COMMENT - Sample for using the trend table.
Long-term Up   Disbelieve  
Intermediate *Down Neutral  
Short-term Down Neutral    
SPY SETUP ENTRY DATE INSTRUCTION STOP LOSS Mechanic trading signals for reference only.
Back tested since 2002.
ST Model 10/14 L 10/13 Low *Stopped out with loss on 10/26
Reversal Bar     Stopped out with gain on 10/21.
NYMO Sell 10/21 S 10/21 High

Improved setup, now the winning rate is 66% and the Gain/Loss Ratio is 4.5. Click the link to see more details.

 

         

INTERMEDIATE-TERM: WATCH CPCE TOP SIGNAL

2.8.0 SPX:CPCE, argues for an intermediate-term top again. The trend line must be held in order to confirm indeed this is an intermediate-term top.

CPCE

SHORT-TERM: BEARS MAY NEED TO TAKE PROFIT IF FURTHER DROP TOMORROW

The bottom line, the market may rebound tomorrow. If however, it keeps dropping, bears better take some chips out of the table.

0.0.2 SPY Short-term Trading Signals, both NYMO and NYADV are very close to oversold. Pay attention to the dashed green lines, SPY rebounded as soon as either of these 2 indicators are oversold.

SPYShortTerm

2.0.0 Volatility Index (Daily), looks like whenever VIX surged high the pullback was almost over. Will this time the same again? Also posted below the visual effect chart – SPY bars are green highlighted whenever VIX up more than 9% a day. So again if the market keeps dropping tomorrow, bears better take some profits.

VIXDaily VIXSurgeVisualTest

1.0.4 S&P 500 SPDRs (SPY 15 min), a few positive divergences, so it’s also possible we’ll see a rebound tomorrow morning.

SPY15min

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