07/22/2010 Market Recap: The Rebound May Have Further To Go


Cobra's Market View Private Messaging System shows:


  TREND MOMENTUM COMMENT
Long-term 2 of 2 are SELL    
Intermediate 2 of 3 are BUY 5 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in BUY mode
Short-term Model is BUY 5 of 5 are NEUTRAL Closed long entered on 07/22, no position overnight.
GANN DAY MOON/SOLAR CYCLE CONCLUSION
07/24, 07/27 07/25 / 07/23 07/29, 07/31 Next pivot date: 07/27 – 07/31
BULLISH
BEARISH 6.2.3 VIX:VXV Trading Signals: A little bit low.
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING PLATFORM:
SSO/SDS, UPRO/SPXU
Non-Stop 07/15 L N/A Be sure to check 8.2.2a to 8.2.2g to understand the risks.
ST Model 07/20 L *Breakeven *Adjust stop loss.

*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.

SEASONALITY: WEEK AFTER JULY EXPIRATION, DOW DOWN 7 OF LAST 11

See 07/16 Market Recap for more details.

INTERMEDIATE-TERM: THE CORRECTION ISN’T OVER YET

See 07/02 Market Recap and 07/16 Market Recap for more details.

SHORT-TERM: THE REBOUND MAY HAVE FURTHER TO GO

My guess is that the rebound may have further to go. See chart below, seldom if not never, a very high black bar at bottom marks a top. Similar to break a car, it must slow down first before eventually being stopped. Very high black bar means the breadth is very strong which equivalent to an accelerating forward car, so chances for the market to make a sudden fall are not high.

SPY60min

 

The chart below shows the estimated price and time target. For time target, if you agree the logic of mini 5 rebound days shown on the chart, then the rebound would last to 07/27 or 07/28. See table above, 07/27 happens to have multiple Gann Day due plus it’s the Turnaround Tuesday and plus according to 6.5.2b Month Day Seasonality Watch, the last 2 trading days of the recent 11 months were bearish. So looks to me 07/27 to 07/28 is more likely the pivot date.

PriceTarget 

Two charts I want to bring your attention, not necessarily mean a down day tomorrow but as long as they’re there, I don’t think the market could go too far.

0.2.0 Volatility Index (Daily), VIX mostly didn’t agree today’s big rebound forming 2 reversal like bars in a row, so it could rebound, which is not good for the stock market. Besides, the VIX to VXV ratio below is still too low, not good.

VIXDaily 

Nasdaq Intraday Cumulative TICK (courtesy of sentimentrader), anther WOW again today. The previous 10 times when I WOW-ed, the market all had a little bit bigger pullback within a few days. (See 07/13 Market Recap, 06/30 Market Recap, 06/25 Market Recap, 06/02 Market Recap, 05/26 Market Recap, 05/18 Market Recap, 05/12 Market Recap, 05/03 Market Recap, 04/29 Market Recap, 04/20 Market Recap and 04/14 Market Recap)

IntradayCumTICK 

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

  TREND COMMENT – *New update. Click BLUE to see chart if link is not provided.
QQQQ *UP 4.1.1 Nasdaq 100 Index (Weekly): Bearish 1-2-3 formation, target 1565.
IWM DOWN 4.1.2 Russell 2000 iShares (IWM Weekly): Ascending Broadening Wedge, target $54.79.
CHINA UP
EMERGING UP 4.1.6 iShares MSCI Emerging Markets (EEM Weekly): Bear Flag?
EUROPEAN UP 4.1.7 Vanguard European VIPERs (VGK Weekly): Bearish 1-2-3 formation, target $35.45; Bear Flag?
CANADA DOWN 4.1.5 iShares CDN S&P/TSX 60 Index Fund (XIU.TO Weekly): Bearish 1-2-3 formation, target $15.30.
BOND UP
EURO UP
GOLD DOWN 4.3.0 Gold Trust Shares (GLD Weekly): Head and Shoulders Bottom, target $129.99.
GDX DOWN
OIL *UP 4.4.0 United States Oil Fund, LP (USO Weekly): Bear Flag?
ENERGY *UP 4.4.1 Energy Select Sector SPDR (XLE Weekly): Bearish 1-2-3 formation, target $43.14.
FINANCIALS DOWN
REITS *UP 4.4.3 Real Estate iShares (IYR Weekly): Pay attention to XHB weakness!
MATERIALS *UP 4.4.4 Materials Select Sector SPDR (XLB Weekly): Bearish 1-2-3 formation, target $27.35.
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