3 replies to this topic

[phineas_gage]

Don't see that every day. ST bottom in? It's fishy though.

[kaiser soze]

Don't see that every day. ST bottom in? It's fishy though.

Welcome to our board Phineas.

I am now interpreting the two day rollercoaster as a Reset (bullish).

Starting Aug 16th, the markets went up alright but the wrong groups were leading - XLF, RKH, IYR, ICF, IWM, the ones that were weakest duing the last sell-off.

In the last two days, the alternating high and low TRINS cleansed the market. Markets are pretty much where they were Friday evening but the weaker sectors have been put in their place while XLK and XLE are showing noticeable relative strength.

http://ichart.financ...p=s&a=v&p=s.png

[rkd80]

I am agreeing with Kaiser on this one, this is bullish. Today also formed the right shoulder of the Inverse H&S, if we break that neckline then new highs are in the cards within a few months. But from a ST perspective, we are almost guaranteed a nothing/slight red day tomorrow. Markets generally do not continue going up after a .3 reading.

[phineas_gage]

It may be worth pointing out the parallel with August 3rd and 6th. We had a 3.38 trin on a 1433 SPX close followed the next trading day by a .45 trin on a 1467 SPX close. Yesterday we closed at 1432.36 and today's close was 1463. It's even more astonishing considering these two periods make up the shoulders of a putative inverse head and shoulders. In the days following the 6th we traded higher on full white candles for two days topping at 1497.49 which also happened to be the 200 day SMA at the time. Guess where it will be this Friday? Yep, close enough. This kind of symmetry is pretty rare. Although many are on board for the inverse head and shoulders, my short term oscillators would be overbought at that level. Alot of shorts (me included) covered yesterday and today so the fuel for a measured move from a 1500 neckline seems sparse. I'm willing to buy the next two days for day chops. But 1500 looks like brick wall to me. I'm not making a stand, or arguing with anybody's vision, but I'll be setting up shorts around helicopter Ben, with stops set to equate to about 1510-1515 SPX. Thats about the neutral point for me as far as trend- i.e.: higher and I'm bullish and lower I'm bearish, but the potential downside from a failure there, just as the 8/3-8/6 parallel shows, is significant. More significant than the upside from where I sit.