Slope of Hope Blog Posts
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Further to my last weekly market update, here is a summary of where money flow ended for Week 3 of April 2012.
The Weekly charts below of YM, ES, NQ & TF show that the only one that did not close higher than the prior week was the NQ (which is back inside its uptrending channel). The ES backtested its uptrending channel, but closed outside, once again.
Over the last 10 days the market and SPY in particular have rallied off the lows of 135.76. Since then SPY has moved upwards establishing two new trendlines. The first is the extension of the long-term trend from December the second is a short-term trendline from 4/10. SPY upwards movement has also been capped by a uptrending channel. All-in-all this has created a bear flag bearish pattern.
Bearish Flag: Is a bearish continuation pattern that is formed after a down movement. Its is characterized by a sweeping down movement followed by an upwards consolidation.
- Measured Move: The "Flag Pole" for SPY bear flag is about 6, from 141.82 to 135.76. This means the estimated downwards movement of SPY would be 6 points from its break.
- Price Target: Depending on where SPY breaks a price target of this move would be 132.66
Oh, this one makes me put on my sad-face. I was short Riverbed coming into yesterday morning, but I got stopped out at a small loss. I didn't really have the time to re-assess the stock yesterday, but you can imagine how my heart sank after yesterday's close when I saw the stock getting pounded 17%. My heart sank further still as the stock continued to collapse during regular-hours trading today, losing over a quarter of its value.
Sigh. Such is the risk of overly-tight stops.