Yesterday the market closed sharply down. In the ESH15 chart below we are showing the OVERSOLD situation, based on our models, on three different time periods: DAILY, WEEKLY and MONTHLY. The values in the gauges at the bottom of the chart represent how much the market is oversold at the price level indicated under the “BUY” arrow, for each time period analyzed.
How to read this? Pretty simple: (more…)
The E-mini S&P500 (ESH15) is rising at the moment of writing this post (overnight): it has already reached levels that could start to be good for a DAILY SHORT trade (short term). The next shortable level would be 2047.75, if you scroll down after the chart you will hear more about our logic. (more…)
So I found myself staring at the E-Mini charts for quite a while this morning. Usually I am pretty snappy when it comes to sorting through the dos and duds of the day – on average I spent in between 2 to 5 seconds on a particular chart. If it doesn’t speak to me right away – meaning if my brain doesn’t pick up sufficient context within that time frame I simply discard it and move on. It’s a daily procedure that has served me pretty well over the years.
The two charts below of the percentage of stocks above their 50 and 200 day moving averages, respectively, show that they are flirting with major support (at the 35 level and the 60 level, respectively). A drop and hold below those levels could see these percentages free-fall for awhile down to their 3-year lows, or lower.
Beef may be back on the menu within the 1st quarter.
After looking around at a few risk ratios I haven’t looked at in a while and given recent developments in price action, I think there is more cause for concern here than many think.
I have reason to believe that Mr. Market is lying to us.
TO GO LONG
The DAILY chart of the ESH15 below helps us visualize the fact that the potential upside for the DAILY impulse is limited if compared to the potential downside. Why? Because our calculation of the impulse extension TO GO SHORT begins from the last candle closing down, i.e. 1994.5 on January 6, 2015, and so a good part of the possible total extension of this upward impulse has been already eaten away by the current wild bounce. On the other hand, the calculation of the TO GO LONG levels starts from the latest up Close, and so there is plenty of room to go down from these highs. For the investor, this means that it would be a bad idea to buy right now, better wait for the inevitable pullback and then, at that point, we can buy at better prices.
CCOC – Consecutive Closes Odds Calculator (TIME EXTENSION ANALYSIS) (more…)
Hey folks, just wanted to share an observation I made today and my hypothesis that the market is at an adjustment point and working out where it’s going to go next. I share one single chart for your viewing enjoyment (click for larger view).