06/17/2010 Market Recap: The 3rd Reversal Like Bar in 4 Days


Cobra's Market View Private Messaging System shows:


  TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)
Long-term 3 of 3 are BUY    
Intermediate 2 of 3 are BUY 5 of 5 are NEUTRAL Non-Stop Model is in BUY mode
Short-term 2 of 2 are BUY 5 of 6 are NEUTRAL SPY ST Model is in BUY mode
GANN DAY MOON/SOLAR CYCLE & TIME FIB CONCLUSION
06/16-06/17 06/26 / 06/21 06/24, 07/31, 08/20-08/23 Next pivot date: 06/24?
BULLISH 0.2.1 10Y T-Bill Yield: Bottomed?
0.1.1 SPX Intermediate-term Trading Signals: CPC MA(10) too high.
BEARISH
CONCLUSION  
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING PLATFORM:
SSO/SDS, UPRO/SPXU
ST Model   *Covered short position entered on 06/04 with loss.
Reversal Bar    
NYMO Sell    
Non-Stop(RSP)   N/A *Cover position entered on 05/11 then take a long position tomorrow or any time you think appropriate after tomorrow.

Since the max drawdown was 8%, so even the model has no stop loss but you’d better use the 8% to calculate the max position size. For example, if you have $100,000 account, your max risk amount is 100,000 * 2% = 2,000, so 2,000 / 8% = 25,000, 25,000 / RSP price say $41.52, your max position size will be 602.

OTHER ETFs TREND *DTFMS COMMENT – *New update. Click BLUE to see chart if link is not provided.
QQQQ UP BUY
IWM DOWN   Ascending Broadening Wedge, downward breakout 73% of the time.
*2 reversal like bars in a row, doesn’t look good.
CHINA DOWN
EMERGING UP *BUY
EUROPEAN UP *BUY  
CANADA UP BUY 1.5.1 TSE McClellan Oscillator: Overbought.
BOND UP  
EURO DOWN BUY
GOLD UP BUY 4.3.0 Gold Trust Shares (GLD Weekly): Head and Shoulders Bottom, target $129.99.
*3.2.0 streetTRACKS Gold Trust Shares (GLD Daily): Ascending Triangle?
GDX UP BUY
OIL UP BUY
ENERGY UP *BUY
FINANCIALS DOWN *BUY
REITS UP  
MATERIALS DOWN   *2 reversal like bars in a row, doesn’t look good.

*Please make sure you understand how to use the table above. The main purpose of this report is to provide information so contradictory signals are always presented.
*DTFMS = Dual Time Frame Momentum Strategy. The signal is given when both weekly and daily STO have the same buy/sell signals. Use it as a filter, don’t trade directly.

SEASONALITY: A LITTLE BIT BULLISH ON JUNE TRIPLE WITCHING WEEK

See 06/11 Market Recap for more details.

INTERMEDIATE-TERM: INITIAL REBOUND TARGET AROUND 1150 AND TIME TARGET AROUND 06/24

See 06/14 Market Recap for more details.

0.0.2 Combined Intermediate-term Trading Signals, a buy signal was triggered today, so should cover the short position take a long position instead. Pay attention to the position sizing tips described in the table above. Officially, the Non-Stop mode wasn’t triggered today because it has some optimized parameters, but I did the visual back test for 0.0.2 Combined Intermediate-term Trading Signals, see 8.2.2a Combined Intermediate-term Trading Signals – 2004 to 8.2.2g Combined Intermediate-term Trading Signals – 2010, the results are not bad. Since the model is for the intermediate-term, so the timing isn’t very important, buy tomorrow or wait for a dip to buy or buy separately within certain period of time are all OK. Again, for fun only, in the eyes of some experts the model might be just a garbage, but at least I’ve spent so much time on it, if you take a look at the links given above for the visual back test, you’ll know. Now I’ve shared this for nothing , even you think it’s a joke, please don’t tell me face to face, because at least I deserve some respects for doing so much for nothing for so long.

RSPToCPCERatio 

SHORT-TERM: STILL NERVOUS ABOUT 3 REVERSAL LIKE BARS IN 4 DAYS, INTRADAY CHART LOOK BULLISH THOUGH

Today SPY formed yet another reversal like bar, so I’m still nervous about what I was nervous yesterday (06/16 Market Recap), 3 reversal like bars in 4 days, at least it should mean something, shouldn’t it? Especially as mentioned in today’s After Bell Quick Summary, SPY up while TNX down 2.8%, there’re 65% chances a red day tomorrow. While the next week, according to the Stock Trader’s Almanac, week after June Triple Witching, Dow down 10 in a row and 17 of last 19. Besides, have you noticed that the Gann Day in the table above has updated to 06/16-06/17? I have some other reasons to believe that 06/17 could be a turning date, the reason is still under observation so I won’t reveal it for now.

SPYShortTerm 

Posted below a simple back test, starting from year 2000, RSI(2) > 70 plus back to back hollow red bar and solid black bar (whichever come first doesn’t matter) like we have today on SPY and IWM daily chart, short at today’s close, cover 4 days later at close. For IWM, amazingly we had 19.9 Gain Loss Ratio. Although the SPY back test result is far less significant than that of IWM, but still it’s not bull friendly.

IWM2ReversalBarsShortSPY2ReversalBarsShort 

6.4.6a QQQQ Black Bar Watch, I’m really glad that someone still remember the QQQQ black bar, the chart below shows what happened after a QQQQ black bar recently.

QQQQBlackBar 

The bottom line, the trend is up, especially 1.0.0 S&P 500 SPDRs (SPY 60 min), SPY intraday chart looks very bullish. Double Bottom neckline being tested and held well, and the thing I like the most is, it consolidated for 2 days forming a launch base where it should have stored enough energy to fly much much higher. All the stuffs that get me nervous above should be considered as risk factors when calculating the position size because as mentioned in 06/16 Market Recap, I’m not sure if we’re in a strong rebound phase from a very very oversold bottom when any bearish signals could simply be ignored.

SPY60min

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