Slope of Hope Blog Posts
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I've drawn a Fibonacci retracement on the Daily chart below of the SPX:VIX ratio pair and have identified a potential Inverse Head & Shoulders pattern.
The first external Fib level of 127.2% at a price level of 92.30ish happens to lie at a confluence/apex of trendline resistance…just above current price.
If the SPX is to move higher, it will have to capture this level and remain above…in this regard, it will be important that the neckline hold at 82.50ish.
However, as can be seen from the Quarterly chart below, that won't be an easy task, as efforts to move much higher since 2004 have been met with profit-taking and choppiness.
Unless some kind of major liquidity injection is forthcoming into the markets soon (e.g. cash on the sidelines), I expect more of the same (profit-taking and choppiness) at current levels on the SPX. However, that will depend on market participant confidence, which seems to have eroded.
This will be a short post but a very important announcement.
I have put together 48 – count 'em, 48 – videos for Slopers about various aspects of technical analysis and ProphetCharts. These ProphetCharts tutorials and technical analysis tutorials are available to you immediately by way of the Knowledge menu, as shown below.
I had actually planned on selling these as a DVD, but I have elected to make them available for free to my readers instead. I hope you find them instructive. I'm going to leave this post up for a long while, so you might as well go check 'em out!
Typically when a stock goes up after I get stopped out for a loss, or a small gain, I'm not one to care or give it much though. It happens, and will always happen. But geesh, sometimes it's just hard to ignore. Take Mellanox Technologies (MLNX) for example. I bought into this stock after it broke out and pulled back to its breakout point three days ago. All is good at this point, but over the next two days it just drops, and takes me out for a 3.5% loss. That's not what bothers me though, because I expect to be stopped out on a number of trades throughout the year. Yesterday though, now that I was out of the trade, it goes up 7% – ok whatever, no worries, but today it is up 41%… yes 41% – the best trader in the world (whoever that happens to be) can't help but be bothered by that.
The Weekly charts below of the YM, ES, NQ & TF show that price has popped above the mid-Bollinger Band as I write this just after noon on Thursday.
At the moment, I'd place general near-term support at this level, which is 12777 for YM, 1354.50 for ES, 2625.50 for NQ, and 792 for TF.
If these levels hold, potential targets are their upper Bollinger Band, or higher…otherwise, I'd look for price to fall, once again, to their lower Bollinger Band/50 sma (red), or lower.
Just about the only sector I've been touting as bullishly-oriented has been energy, and I'm pleased to see this is panning out. A lot of battered stocks I've mentioned (KEG, SM, etc.) have been rallying, and USO is up over 3% as I'm typing this.
My hunch is that nailing the 50% retracement (circled below) is almost a given, but don't be surprised to see selling at that point.