173 replies to this topic

[diogenes227]

A couple notes of caution. The NYMO put in a high below a high today (see chart in post above). It's been a while since that has happened and while the NYSI is still rising on its buy, the NYMO high needs to be recognized for what it is -- a danger sign. The NYSI lags the turns so one should pay attention to the pattern on the NYMO to fine tune the timing of the turn. The market may or may not move lower here but it should also be noted that we are 50 days into this McClellan cycle, a cycle that often likes to put in a low around 60 days or so -- in other words we have to go down to hit that low eventually and that might start now. TNA on the NYSI buy signal from July 7th is up 21 percent.

[maineman]

TNA on the NYSI buy signal from July 7th is up 21 percent

yes... don't I know... how sweet its been....

mm

[diogenes227]

A couple notes of caution.

The NYMO put in a high below a high today (see chart in post above). It's been a while since that has happened and while the NYSI is still rising on its buy, the NYMO high needs to be recognized for what it is -- a danger sign. The NYSI lags the turns so one should pay attention to the pattern on the NYMO to fine tune the timing of the turn.

The market may or may not move lower here but it should also be noted that we are 50 days into this McClellan cycle, a cycle that often likes to put in a low around 60 days or so -- in other words we have to go down to hit that low eventually and that might start now.

TNA on the NYSI buy signal from July 7th is up 21 percent.

Today is why one should pay attention to danger signs.

The NYSI turned down today giving a sell signal. And once again the NYMO gave a lot of advanced notice this day was coming. It doesn't always go this way but let's call it "three little hills and then a big valley." Take a look a the chart below, note the three red circles on the NYMO, Those "hills" are the highs below highs that tend to let you know the rally is running out of time and NYSI, which often lags, will turn. There they were back in January, again in April-May, and NOW, each time followed by the valley, also repeating history. In addition, there is almost always the warning 50 days or so into the cycle that the rally will not last and here we are on the 56th day and heading down. So simple when there is an indicator as sensitive and reliable as this one.

Hopefully, the warnings were heeded. The TNA that was up 21 percent in the above post (the first hill, the first red circle) finished this NYSI rally up 2.4 percent. Volatile stuff these 3x leveraged ETFs.

The bears have the ball until further notice. It is a time to be in cash, or short, or selling the rallies, whatever personal trading style one prefers but it is not a time to try to fight the NYSI's decline.

Good trading to everyone.

http://stockcharts.c...1656&r=4067.png

[diogenes227]

Just for the record of this thread, am adding the post from yesterday on the FF board calling for a bounce today against the NYSI decline (especially now that it's come true ).

Yesterday's Fearless Forecasters Post

[diogenes227]

NYSI turned up today, by 3 points on StockCharts. That's a buy of course but I suspect there may be a whipsaw in the offing here. Partly, because we haven't been down long enough to set up a sustained advance, but mostly because there is no low above a low on the NYMO. It would be a gift to the bears to paint a ledge here in the next few days and then continue the down swing. Regardless, I would not hold TZA; it's too volatile (stopped out today for a 2.6 percent loss). Can always jump back into it when the NYSI turns down again. In the meantime, the bounce against what was, yesterday, a NYSI downtrend could continue into a very nice upside pop indeed. TNA up 5.2 percent today. Reasons to have taken that trade are in the Fearless Forecasters link above. Good trading to everyone.

Edited by diogenes227, 17 August 2010 - 04:17 PM.

[diogenes227]

Yup, a whipsaw. Back on the sell, and that hook in the NYSI often means there will be an acceleration -- in this case, to the downside.

[diogenes227]

Note the chart above. NYMO has a small low above a low in it in coming from oversold territory. RVX has clicked down CCI on TNA is coming out of oversold. For the aggressive trader this is a long, a bounce at least and maybe the start of much, much more (which I, for one, am respecting). NYSI, however, remains on a sell. It lags but it may also be warning there is more downside to come. Regardless of longs or shorts, this is a time for tight stops.

[diogenes227]

NYMO has another low above a low (see chart above when Stockcharts updates). The bears better rage and rip this apart soon or they will be face-to-face with the ol' tranquilizer gun. NYSI remains on a sell. In a typical bull market pullback the NYSI likes to go down three to five weeks. We just finished the third week. Question is with that death cross on many indexes staring everyone in the face are we even in a bull market anymore? Does it bother anyone at the moment that everyone in the world can see the fifty moving averages crossing the two hundreds?

[diogenes227]

NYSI is on a buy. And we are overbought. Ain't this a fun market? What a great day this was for aggressive traders with NYMO lows-above-lows buys of the past three days. Good trading to everyone.

Edited by diogenes227, 01 September 2010 - 03:06 PM.

[Carl]

Love your Topic on Russell,and always look for tour post.For inexperience person like me could you please post daily suggestion on what may happen NEXT DAY,so that i can try to compare your system whit mine or OURS. Carl