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Sunday, December 26, 2010

Sunday Observations!!!

Roy's week-end video deals with the British Pound after some great comments about the general market. He still remains bearish on the Equities market but has not gone short just yet, he sees Bonds and Oil movements resulting in a reversal of the Equities and is waiting for a confirmation move to go short, in the mean time he is watching a great opportunity developing in the currency market. To view the clip, Click Here!!!

I am still leaning towards this rally on the Daily chart being counted best as a complex corrective. The big question is this the last leg up, or will it morph once again into a more complex count?
1173 even, is a VERY important level of support the bulls need to hold, in the past any break below a lower fan line has resulted in a larger sell-off. There has been a level of symmetry in the angles of each proceeding break, with the next angle projected with the Gray fan line. Any sizable sell-off next week will most likely start a cascade of selling as technicals will quickly turn bearish. The Weekly and Monthly charts are also at extreme over-bought conditions suggesting this next sell-off could be a large one.
During Thursday's market the Trendfinder was flashing sell signals intraday on some of the major indexes on a daily time frame, although no signals were confirmed at the close, it does provide a clue that the Equities are very weak and close to confirming a sell. I do expect that any down day Monday will start triggering more sell signals. I normally do not post or trade on the results of the 4 hour charts, but all major indexes did confirm a sell at the close on this time frame.
I am hoping to get enough time in the next couple of weeks to start posting results of the Trend Finder II, I have done a lot of back-testing and tweaking over the last year, and accumulated a ton of data on the different Indexes since I started tracking them with the Trendfinder, the results have been nothing but spectacular!!!
The Chart of the Bullish Percent Index has hit the upper trendline, IF it reverses from here it sets up a further long-term divergence, that is bearish for the SPX. The STO, the bottom indicator has started to roll over to a sell.
$CPCE, The CBOE Options Equity Put/Call Ratio is now in extremes with Calls far out-numbering the number of Puts, this is a good signal that a top is about to happen.
BKX, Is not a bullish looking chart right now, it is signaling bearish tones with all the indicators now on a sell after diverging in the most recent high, a break below that trendline should get the ball rolling to the downside.

1 comment:

  1. Is China's Property Bubble About To Burst?

    (Reuters) - China's government will be able to keep inflation in check, Premier Wen Jiabao said on Sunday, a day after the central bank raised interest rates, and he pledged to speed up efforts to rein in house price surges.

    Copper: Is this inflation?

    When China last raised interest rates in mid-October, it sent the dollar higher, dragged gold down by more than 2 percent, oil fell 4 percent, copper lost almost 2.5 percent, and losses of 2.7 percent in wheat and 2 percent in corn.