07/19/2011 Market Outlook (Huge Up with Poor Breadth)


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SHORT-TERM: IN WAIT AND SEE MODE

Although huge up today but I didn’t see enough evidences to make a very bullish statement, need wait for a few days. I’m now a short-term bull, but still hold short position. I’ll add into the winning side in the following days.

The biggest question mark today is SPY up 1.6%+ but it’s not a Major Accumulation Day which means the breadth is not strong enough. SPY up 1.6% and NYSE Down Volume : NYSE Up Volume < 6, buy at today’s close sell 1, 2, 3, 4, 5 days later for the last 2,000 trading days, from the test results below we can see, it’s hard to call bull in the following week. Besides, seems no straight up when such kind of huge up weaker breadth day happens, see red bars below, all choppy ahead. So purely from today’s action, I cannot make a very bullish statement yet.

UpHugeWithWeakBreadth

Another reason I want to wait for a few days is AAPL. I mentioned yesterday, that a typical AAPL post ER action was firework, shot high then fell back. In addition, I see another problem today, MACD is way too high which also argues that AAPL eventually will fall back to the ground. AAPL weights 12.23% in Nasdaq, so if indeed AAPL’s falling, I don’t expect QQQ to perform good.

AAPLTooStretchedAAPLER

INTERMEDIATE-TERM: BULLISH JULY

See 07/01 Market Outlook and 07/05 Market Outlook for more details.

SEASONALITY: BEARISH NEXT WEEK

According to Stock Trader’s Almanac, week after July expiration, Dow down 7 of last 12, 2007 –4.2%, 2008 –4.3%, but up 4.0% in 2009.

Also see 07/01 Market Outlook for July seasonality chart

ACTIVE BULLISH OUTLOOKS:

ACTIVE BEARISH OUTLOOKS:

  • 07/18 Market Outlook: 2 Major Distribution Days within 5 days means rebound then more selling thereafter.

SUMMARY OF SIGNALS FOR MY  PUBLIC CHART LIST: 

  TREND MOMENTUM COMMENT
Long-term 2 of 2 BUY
Intermediate 3 of 5 BUY 5 of 5 NEUTRAL Cobra Impulse in BUY mode; Non-Stop in SELL mode.
Short-term *UP 6 of 6 NEUTRAL
  TREND COMMENT
QQQ & Weekly UP  
IWM & Weekly UP  
SSEC & Weekly UP  
EEM & Weekly DOWN
XIU & Weekly DOWN
DAX & Weekly DOWN  
TLT & Weekly DOWN  
UUP & Weekly DOWN
GLD & Weekly UP  
USO & Weekly DOWN  
XLE & Weekly UP  
XLF & Weekly DOWN
IYR & Weekly UP 4.4.3 Real Estate iShares (IYR Weekly): XHB lags, be careful.
XLB & Weekly UP  
  • * = New update; Blue Text = Link to a chart in my public chart list.
  • UP = Intermediate-term uptrend. Set when weekly buy signal is triggered.
  • DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.
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