11 replies to this topic

[arbman]

I have very rarely seen in my backtests such a powerful line up. I posted here the deteriorating liquidity picture a few weeks ago and I indicated that the next rally would be most likely on a deteriorating breath, here it came with the bullish speculation. I see about 81% cyclical sell strength on the entire market. This is a huge number and calls for a Feb 27th type decline. This is combined with the extremely weak 131 trending break out indications for this rally as of Monday's close, down from 200 only two days ago, the breath absolutely deteriorated over the past 2 trading days. FYI, the peak b/o number was recorded around late April around 400, the number of break outs steadily declined since then. The number of break outs on Feb 22 was over 200 before the serious market correction. I also posted here my historical pattern matches indicating lower close over the next 10 sessions earlier last week. There were more new lows last week and the new highs are also diverging at this point. Now, add to all of this the near record bullish speculation flows over the past 4-5 days. Not only the majority of the traders covered, but many also speculated long. I don't think we need to overanalyze this any further, a large correction will be here within days before the month is over... - kisa PS. my strongest sector sell signal is in oil and drillers.

Edited by kisacik, 19 June 2007 - 07:32 AM.

[airedale88]

kisa, looking at the positions of various cycle FLD projection lines and the accompanied 1/2 span lagged moving averages i think you've outlined a good possiblity.

[Wombat]

Thanks very much for posting this!

[rkd80]

Cool stuff kisa, one question though. Given what you said in NAV's post does your system 'require' that we have a blow-off rally? Or a slight move to new highs vis a vi Feb 23-25th sufficient? It seems given what you are saying with the deterioration and other people's systems flashing all red, why does the market even need that last push? To blow away some stops?

I have very rarely seen in my backtests such a powerful line up. I posted here the deteriorating liquidity picture a few weeks ago and I indicated that the next rally would be most likely on a deteriorating breath, here it came with the bullish speculation.

I see about 81% cyclical sell strength on the entire market. This is a huge number and calls for a Feb 27th type decline.

This is combined with the extremely weak 131 trending break out indications for this rally as of Monday's close, down from 200 only two days ago, the breath absolutely deteriorated over the past 2 trading days. FYI, the peak b/o number was recorded around late April around 400, the number of break outs steadily declined since then. The number of break outs on Feb 22 was over 200 before the serious market correction.

I also posted here my historical pattern matches indicating lower close over the next 10 sessions earlier last week. There were more new lows last week and the new highs are also diverging at this point.

Now, add to all of this the near record bullish speculation flows over the past 4-5 days. Not only the majority of the traders covered, but many also speculated long.

I don't think we need to overanalyze this any further, a large correction will be here within days before the month is over...

- kisa

PS. my strongest sector sell signal is in oil and drillers.

[harry5]

thanks very much for posting - great summary of your indications. please continue posting. good luck from austria, europe harry

[arbman]

Given what you said in NAV's post does your system 'require' that we have a blow-off rally?

There is always the little bit of noise, I hoped for a dumb rally, but I think the stop runs are all done last week, I close my eyes and sold short the open at whatever prices I was able to get...

[esther231]

Thanks, Kisa.

[rkd80]

Given what you said in NAV's post does your system 'require' that we have a blow-off rally?

There is always the little bit of noise, I hoped for a dumb rally, but I think the stop runs are all done last week, I close my eyes and sold short the open at whatever prices I was able to get...

yeah, you know i was thinking that trying to catch those few extra points that a dumb rally could produce might cost you more if the market starts selling off. i am fully short now too and like the rest of us will probably be watching at the quality of the sell-off.

[arbman]

Honestly, a little wiggle here will not bother me, however only the Fed can save this sometime longer... It's been a while without the pomos, I am worried about that. It's been too long and another leg higher might come if the Fed decides to help here...

[SemiBizz]

Watch out for a bullish spring when this one breaks the 6-7 low. It is a big piece of the QQQQ... potential rocket fuel. Took profits on QID this morning when the 3 min Nasdaq turned up...



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