03/10/2011 Market Recap: Has another down leg started?


Cobra's Market View Private Messaging System shows:


  TREND MOMENTUM COMMENT
Long-term 2 of 2 are BUY  
Intermediate 5 of 5 are SELL 5 of 5 are NEUTRAL SPY ST Model in BUY mode; Non-Stop in SELL mode.
Short-term 6 of 6 are NEUTRAL
GANN DAY MOON:SOLAR CYCLE CONCLUSION
03/05-03/09 03/04 : 03/06 Next pivot date: 03/06, (02/20 pivot top to be confirmed)
BULLISH 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.
4.1.0 S&P 500 Large Cap Index (Weekly): Cup with Handle, target 1428.
BEARISH 4.0.1 SPX Long-term Trading Signals: Weekly EMA(13) is way too high above weekly EMA(34).
03/04 Market Recap: OEX put/call ratio too high, could be choppy ahead.
My Thoughts The pullback since 02/22 may last but the 02/18 high will be revisited in 69 calendar days on average.
SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING PLATFORM:
SSO/SDS, UPRO/SPXU
Non-Stop 02/24 S N/A 02/23: Close long and sell short. Short is for aggressive traders only.
ST Model 02/25 L Breakeven Stopped out long position on 03/01 flat.
Short-term *DOWN? I hold no position overnight.

SHORT-TERM: NOT SURE ANOTHER DOWN LEG HAS STARTED, EVEN THE MARKET COULD BE BOTTOMED

I’m not sure another down leg has started today. Even the market could have bottomed. The reasons are price overlapping (both price bars and swings), which doesn’t look like an impulse wave down, and the volume surge, which more often than not means a bottom.

SPY60min

The chart below compares the Jan 2010 pullback with the Nov 2010 pullback and explains what a strong push down looks like and what the price overlapping is. And it should have explained why the January pullback could go further than that of November pullback. Now comparing to our current price pattern as shown above, it should be obvious whether we are now like January or November. I don’t mean we’re going to repeat November, I’m just saying that so far we don’t have an impulse wave down yet, so not sure whether another down leg has started.

StrongPushDownVSWeakPushDown

The chart below illustrates what happened recently after a volume surge, especially if the surge was after a few down days. And this is why I cannot exclude the possibility that a capitulation or sell exhaustion has happened today therefore a rebound could start as early as tomorrow.

VolumeSurge

INTERMEDIATE-TERM: COULD NOT BE VERY BRIGHT

See 03/04 Market Recap for more details.

SEASONALITY: NO UPDATE

For March seasonality chart please refer to 03/01 Market Recap.

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

SIGNAL COMMENT
QQQQ 01/28 S
NDX Weekly UP
IWM
IWM Weekly UP
CHINA
CHINA Weekly UP
EEM
EEM Weekly UP?
XIU.TO 03/09 S *1.5.1 TSE McClellan Oscillator: Oversold.
XIU.TO Weekly UP
TLT Could be a channel breakout, trend may about to change.
TLT Weekly ?
FXE
FXE Weekly UP Testing Fib confluences area.
GLD
GLD Weekly UP
GDX 02/03 L
GDX Weekly UP
USO ChiOsc is way too high.
WTIC Weekly UP Too far above BB top.
XLE *03/10 S
XLE Weekly UP
XLF 10/15 L
XLF Weekly ? Small lower low wait for follow through to confirm the trend change.
IYR
IYR Weekly UP
XLB 02/09 S
XLB Weekly UP
  1. Please make sure you understand how to use the table above. The purpose of this report is to provide info so contradictory signals are always presented.
  2. Conclusions can be confirmed endlessly, but trading wise, you have to take actions at certain risk level as soon as you feel the confirmation is enough. There’s no way for me to adapt to different risk levels therefore no trading signals will be given in this report except the mechanical signals such as SPY ST Model.
  3. * = New update; Blue Text = Link to a chart in my public chart list.
  4. Trading signals in OTHER ETFs table are mechanical signals. See HERE for back test results. 08/31 L, for example, means Long on 08/31.
  5. UP = Intermediate-term uptrend. Set when I see at least one higher high and higher low on daily chart.
  6. DOWN = Intermediate-term downtrend. Set when I see at least one lower high and lower low on daily chart.
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