Friday, June 06, 2008

Weekly trends - 6/6/08

Sideways to down it was, as i posted last week. I was expecting 1425 max on the upside, which got undershot. The downside today was pretty dramatic. We are now near my downside target of SPX 1350-60 area. I still beleive that this area will provide the support and we launch a multi-month rally from here. The key here is the NYSE Vol MCO which is putting in a divergent bottom relative to price.

The key is not the divergence itself, but the price reponding to this divergent setup. So we need to see the divergence hold and price confirming by giving a daily buy signal. If that happens then we are on track for a multi-month rally here. Now if the NYSE Vol Osc breaks that blue line in my chart, that's a warning sign that something big on downside is coming. Pricewise, if 1324 cracks then the IT uptrend is over and the next leg of the bear market has begun. That's not what i am expecting here, but something to be open minded about.

I have not seen the indices as broken as it is now, in a long time. NDX and RUT are not even in daily downtrends and yet to break the 5/30 weekly chart lows. But SPX chart looks completely broken from a daily chart perspective and holding on to dear life from a weekly perspective. Who's real...who's faking ? We should know soon.

Gold, Silver
As i noted last week Gold and Silver are in some sort of sideways congestion before we start a trending move up. Many are expecting a big downslide in Gold, which i am not. I will likely take a position in Gold sometime next week. I need to see some more strength before commiting, to avoid whipsaws.

Yawn...The weekly downtrend continues.

The weekly uptrend continues. A very dangerous market here, which appears to be in a blow-off phase.

Monday, June 02, 2008

Weekly Trends

The weekly on SPX remains in an uptrend with an eventual objective of SPX 1500 +/- 20 points. Only a break of SPX 1324 would invalidate the weekly uptrend, and would mean a multi-month decline has started.

The daily on the SPX is currently down and the market should remain rangebound for the next couple of weeks between SPX 1425 and 1350. My hourly model on SPX remains on a buy with a max upside target of 1425 this week, after which i expect a test of the SPX 1350-60 area.

GOLD and Silver
Gold and GDX remains in a weekly uptrend despite all the downside volatility this week. Silver which went to weekly buy last week entered a sell this week. The non-confirmation between the Silver and Gold continues. To me this appears to be a sideways congestion pattern, before the uptrend resumes on the weekly charts. However this is not a easy market to trade with confidence here. Closed my GLD position at breakeven this week and SLV for a 2% loss. Will reasess Gold based on this weeks action. Staying out for now.

Dollar index remains in a weekly downtrend. So boring...

Oil remains in a weekly uptrend. Yawn...