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I thought I'd look at the S&P 500 and Russell 2000 Indices, Gold,
and Oil to compare where they are trading on a 1-Year Daily timeframe
relative to their 50 sma and on a 3-Year, 1-Year Daily, and 11-Day timeframe
relative to each other.
The first chartgrid shows a 1-Year
timeframe, with the SPX and RUT trading around their 50 sma, Gold is
above its 50 sma, and Oil is below its 50 sma. The second chartgrid shows a 2-Month close-up shot, with today's recovery into the close on
the SPX, RUT, and Oil. Gold closed near today's low. While the SPX and RUT have
made a new high during the past year (which is serving as near-term resistance,
thus far), Gold and Oil have not. The triple top on Gold at 1800 is serving as
major price resistance, while the 100.00 level is holding as major price
resistance on Oil (with the 50 sma holding as near-term resistance at
Before the bulls’ heads explode from the massive one day 11.54
point rally in the S&P let me come to the rescue and pour some ice cold
water on the euphoria. I’m going to keep
the prose to a minimum and just offer a series of charts. The first three are the last three major
double tops IN WHICH the right peak just fell short of the left (this is hugely
important psychologically). The last is
just a little bear porn that might just morph from fantasy to reality.
Well, the five days the market managed to ease lower felt like a blow-out party for the bears, considering it happens so rarely these days. It's kind of like celebrating the fact that a kernal of corn was placed on your plate for dinner. Whoop-de-freaking-do.
The trendlines on the ES have both provided firm support for the ES thus far, and if it breaks 1439.25, I think it'll just give the bulls more courage. Earlier today, I eased into some bullish positions that have been strong in the recent past (ACI, AIG, ANR, AVP, CRK, PPL, SLM, TBT, XCO, XL) to balance out my shorts. I also took a few profits on the short side.
Those of you even a little familiar with me know that I don't get my jollies sitting in front of a television and whooping for whatever I am seeing (like, say, football, basketball, bass fishing, or anything else). But when it comes to anything to do with space exploration, I get interested.
Although I recognized the whole Felix jump thing as a fantastic marketing push by Red Bull, I still thought it was an awfully cool idea. Last week, I watched the first attempt, but that got nixed due to weather conditions. The second one did too. I figured people would lose interest.
But on Sunday morning, I saw he was having a third go at it, and I gathered the family together to watch the entire thing live. I can't remember being so excited and spellbound by anything I've seen on television (except, on the very opposite end of the emotional scale, for 9/11). The little "best of" clip below doesn't even come close to approaching the thrill of seeing things happen in real time, but it does a nice job of showing some highlights. When he stepped off the platform, it took my breath away; and seeing him spin wildly in a free-fall, only to right himself into a Superman pose and get stable, I couldn't help but burst into applause.
There's no actionable trade idea here, people. It was just really, really awesome.
I won't include the SPX daily chart today as I posted the SPY equivalent yesterday in my weekend post at MarketShadows and you can see that here. What I have to add to that this morning is that I have had a close look at the current bollinger band setup back to the start of 2009, and have come up with the following stats:
9 instances – Touch and reversal or 2 day base at the lower bollinger band.
7 instances – A plunge through the lower bollinger band.
10 instances – Riding the lower bollinger band downwards as we are seeing at the moment.
Of this last group of 10, which is the group of interest today, and we would now be starting day 4 as the first touch was on Wednesday, the outcomes were as follows:
2 instances – A low on the third day – short term bullish
6 instances – A low on the sixth or seventh day 20 to 70 points lower – short term bearish
2 instances – A low on the tenth day or later over 50 points lower – short term bearish