04/12/2011 Market Recap: No Confidence in the Coming Rebound


Cobra's Market View Private Messaging System shows:


  TREND MOMENTUM COMMENT
Long-term 2 of 2 are BUY
Intermediate 5 of 5 are BUY 5 of 5 are NEUTRAL Cobra Impulse in BUY mode; Non-Stop in BUY mode.
Short-term 6 of 6 are NEUTRAL
GANN DAY MOON:SOLAR CYCLE CONCLUSION
04/11-04/15 04/03 : 04/05 04/04-04/13 Next pivot date: 04/11
BULLISH 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.
02/23 Market Recap: Pullback could last 4 weeks, then 02/18 highs will be revisited.
03/11 Market Recap: Bullish in 3 to 6 months.
04/01 Market Recap: Bullish April.
*0.1.0 SPY Short-term Trading Signals: A few TradingMarkets long setups trigged on 04/12.
BEARISH 4.0.1 SPX Long-term Trading Signals: Weekly EMA(13) is way too high above weekly EMA(34).
03/18 Market Recap: 03/16 lows will be revisited.
0.0.2 Combined Intermediate-term Trading Signals: Top confirmed?
0.2.4 Nasdaq Total Volume/NYSE Total Volume: Top?
My Thoughts *There’re some chances that an intermediate-term top was in.
SPY SYSTEM ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
Non-Stop 03/31 L N/A
CI Buy & Hold 12/03 L N/A
CI Swing *Long if SPY breakout 04/12 high tomorrow. The stop loss is 1.7*ATR(10).
Short-term DOWN N/A I hold both long (trapped) and short overnight.

SHORT-TERM: DOUBT ABOUT THE COMING REBOUND ESPECIALLY ON HOW FAR IT COULD GO

Three cents:

  1. Although lots of TradingMarkets long setups have been triggered and statistically good chances we’ll see a rebound tomorrow, but somehow, I’m not confident about those setups.
  2. Even the market does start to rebound tomorrow, I really doubt how far it could go.
  3. Trading wise, I’ll try to sell the bounce, unless the market rallies huge tomorrow.

I’ve mentioned lots of bullish setups in today’s After Bell Quick Summary and in addition, we may have a potential long setup from Cobra Impulse System (trial version) tomorrow, so it seems that I shouldn’t argue at all about whether there’ll be a rebound or not here. However, the last 2 bars in the SPY 60 min chart make me feel uneasy, so there’re chances that today’s low might be revisited tomorrow morning at least.

SPY60min

Why, if any rebound, I have a doubt about how far it could go?

VIX:VXV is still too low. It’s really hard to image how low this could go if the market rallies really really huge from here.

VIXtoVXVRatio

Institutional Buying and Selling Action from StockTiming. Generally speaking, the market rally is mainly due to lack of institutional distribution, not because of institutional accumulation. So the question is, since the current institutional distribution is still at a very low level, how low could it go if the market rallies really really huge from here?

InstitutionalBuyingAndSellingAction

The last but not the least, about the potential long setup from Cobra Impulse System tomorrow, today’s high must be taken in order for the setup to be valid, otherwise as illustrated in the chart below, chances of being trapped are pretty high. The very common way to trade this kind of setup is to place a buy stop above today’s high, say, SPY, 2 cents above $131.98 is $132.00, so that the position will be automatically filled when SPY breaks above today’s high. If, however, SPY gaps up above today’s high directly tomorrow morning, then in this case, I’ll place the buy stop above the 15 min Open Range high to prevent the potential failed gap up open. Please be noted that the Cobra Impulse System is for fun only, I’m not responsible for any damages such as fire, flood and bankruptcy caused by the system which are very common symptoms when blindly follows it.

CISystem

INTERMEDIATE-TERM: BULLISH APRIL, SPX TARGET 1352 TO 1381, BEWARE 04/11 TO 04/14 PIVOT DATE

See 04/01 Market Recap for more details.

SEASONALITY: APRIL HAS BEEN HISTORICALLY THE MOST BULLISH MONTH OF THE YEAR

See 04/01 Market Recap for more details. Also according to Stock Trader’s Almanac:

  1. Monday before expiration, Dow up 14 of last 21, down 4 of last 6.
  2. April expiration day, Dow up 11 of last 14.
  3. Income tax deadline, generally bullish, Dow down only 5 times since 1981.

HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST

TREND COMMENT
QQQ & Weekly UP
IWM & Weekly UP
SSEC & Weekly UP
EEM & Weekly UP
XIU & Weekly UP
TLT & Weekly DOWN
FXE & Weekly UP
GLD & Weekly UP
GDX & Weekly 04/05 L
USO & Weekly UP
XLE & Weekly UP
XLF & Weekly DOWN
IYR & Weekly UP
XLB & Weekly UP
DBA & 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. * = New update; Blue Text = Link to a chart in my public chart list.
  3. UP = Intermediate-term uptrend. Set when weekly buy signal is triggered.
  4. DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.
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