A lot of indecision and divergences in the markets today. The S&P 500 (SPY) had an inside trading day, showing no directional movement on the daily chart. The Nasdaq (QQQQ) was relatively strong, closing up .5% while the other indexes sold off .5%-1%. Gold (GLD) pulled back slightly and the dollar (UUP) broke above resistance at the 200 day moving average. The VIX popped ever so slightly, up .5%. The TRIN was very bearish today while the TRIN/Q remained bullish.
Based on earnings alone (so far they have been good after hours), I would expect the markets to trade higher tomorrow. However, things can turn on a dime as it is earnings season. Also, we have Jobless Claims and Productivity & Costs numbers coming out pre-market tomorrow. Always check earnings dates for stocks you are watching and/or trading. It is not prudent to hold positions or trade into earnings. Also, it is important to always define your risk and trade with a stop loss.
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Happy Trading,
Jason
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The markets popped today, putting a temporary end to the recent sell off. All of the major indexes have put in a swing low now, however, the Nasdaq (QQQQ) and Russell 2000 (IWM) are relatively weak to the S&P 500 (SPY), Financials (XLF), and Dow Jones Industrial Average (DIA) on the daily time frame. If the bulls want any hope of continuing the March 2009 rally past March 2010, the next swing high better not be lower than the last. That would be bearish to see and would provide more confirmation for the markets rolling over here.
The dollar (UUP) appeared to be breaking above a resistance line as well as the 200 day moving average on Friday, but has pulled back under the resistance this week, therefore registering it a failed break out. Gold (GLD) has marked an equal swing low to the last swing low and may form a double bottom formation here. It is not a confirmed double bottom yet, on gold, and there is a bit of resistance to fight through on the upside. If gold continues to rise and the dollar continues to drop, that will help push stocks higher.
The VIX dropped 5% today, which is more than enough to confirm the 1% pop in the general markets. The TRIN and TRIN/Q were both very bullish today. The TICK and TICK/Q corroborated the move nicely.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately! Also, be sure to check earnings dates for stocks you are trading and/or watching. It is prudent not to hold over earnings. Finally, it is a good idea to regularly check the Bloomberg Economic Calendar and sites like Yahoo finance so that you know the major headlines that may move the markets.
Happy Trading,
Jason
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The major indexes rose more than 1% today. Volume was average, which certainly takes away from the move. The VIX dropped more than 8% today, which is pretty significant. A 3-4% drop in the VIX would have been enough confirmation for today. The TRIN was certainly bullish and the TRIN/Q was almost overly bullish, hovering around .4 all day. The TICK and TICK/Q corroborated the sideways chop that we saw for most of the session.
Gold (GLD) spiked up 2.26% today which is good for the markets. Also, the dollar (UUP) dropped .43% and that also helped push stocks higher today.
The S&P 500 (SPY) could be marking a swing low here, but it is certainly not confirmed yet. A break above 110 would be strong confirmation of a swing low here. Otherwise, the daily chart is still showing the makings of a weak low base consolidation.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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The markets are looking extremely bearish. The most important news today is the fact that GDP and Consumer Sentiment reports both came out better than expected, and the markets sold off. Remember, how the market reacts to the news is more important than the news itself. If you will recall, back in March and April of 2009, the market responded to negative news with buying pressure. Right now, the markets are responding to positive news with selling pressure.
The S&P 500 (SPY) broke down out of a rising wedge on the daily chart and formed a high base. Today (and yesterday), SPY broke down out of the high base formation. All of this selling pressure occurred with increasing volume. That is significant confirmation of the bearish formations. Gold (GLD) has put in a short term top and the dollar (UUP) just broke out of a falling wedge and today broke above the 200 day moving average. Recently, the correlation has been that when the markets are up, gold is up and the dollar is down. These are all indicating bearish activity and probably more selling pressure to come.
The Nasdaq (QQQQ) was the leader to the downside today, followed by the Russell 2000 (IWM). These are leading indexes and they are adding to the selling pressure. The VIX popped about 3.75% today and tested the 25 mark. The TRIN, TRIN/Q, TICK, and TICK/Q each corroborated the moves in their respective indexes nicely today.
This is the worst pull back we have seen in a very long time. Unlike the head and shoulders break down we saw in July 2009, this sell off is being confirmed by extreme increases in volume. This is serious folks. I always say it, but I hope my repetition has not detracted from its value… Always trade with a stop loss and manage your risk appropriately! Capital preservation is a traders number one priority.
Have a great weekend. Thanks for being a part of Swing-High.com!
Happy Trading,
Jason
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The FOMC Minutes moved the markets higher today. Today was a fairly common Fed announcement day as the markets chopped sideways on low volume until 2:15, at which time volume, volatility, and in this case prices picked up into the close. If you caught yesterday’s Post Market Analysis, I warned everyone to look out for this announcement.
The S&P 500 (SPY) is still consolidating in a low base formation, trading under 110 and above 109 for the most part today (with the exception of the brief run down to 108.3 around 2:15). The TICK, TICK/Q, TRIN, and TRIN/Q corroborated today’s action nicely. Keep in mind that the TICK/Q and TRIN/Q correspond with the Nasdaq. I forgot to mention the VIX in my video, but it dropped 5.75% today, holding up above 23. The Financials (XLF) and Russell 2000 (IWM) were clearly the strongest of the five major sectors I cover on this site. That is certainly bullish, but on the daily charts, things still look pretty weak across the board. If SPY does put in a swing low here, I expect a lower swing high around 112 or 111. If SPY consolidates here and breaks down past 108, the next support areas are 105 and 103.7.
I want to briefly mention AAPL here. It looked like AAPL was going to have a classic “buy on the rumor, sell on the news” type day today with the release of the iPad (terrible name by the way). However, it rallied back and closed higher for the session. Right not it is not showing a buy signal on the daily chart. I would like to see it continue to consolidate here, putting in a high base or ascending triangle. From there, a break above 115.55 on convincing volume would be a buy. If not, playing a pull back buy could be an option in the future.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately, especially on days like today and as volatility is increasing.
Happy Trading,
Jason
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Interesting day in the markets as most major indexes were up about .5% mid-day, but all of them pulled back and finished in the red. The Financials (XLF) and Russell 2000 (IWM) were relative weak today. The VIX dropped about 3.5%. The TRIN, TICK, and TICK/Q all corroborated today’s action pretty well. However, the TRIN/Q stayed bullish all day. SPY is still in the process of consolidating at these levels. I would like to see a low base or a lower swing high going forward to support the bear case.
The FOMC meeting at 2:15 will probably be the highlight of the trading day tomorrow. Also watch the New Home Sales and EIA Petroleum Status Reports. Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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Big sell off across the board today. The S&P 500 (SPY) broke down out of its rising wedge formation on the daily chart. The high base was shattered today, so a high base breakout is no longer a possibility. The break down occurred on very high volume which is significant in confirming the rising wedge break down. The VIX popped 20% today, closing over 22! A lot of fear is coming in to the markets at this point. The TRIN was very bearish while the TRIN/Q was oddly bullish. The TICK and TICK/Q were both bearish today.
Be very careful going long in this environment. I am personally going to wait for the next swing low before considering taking up any more long positions. Always compare stocks you are watching to the indexes to identify relative strength or weakness. Going short would be a better bet right now, but it is tough to say how far the sell off will go. Expect major support for SPY at the 108-110 area.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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Today we saw a broad market rally, with all of the major indexes popping 1% or more. The TRIN, TRIN/Q, TICK, and TICK/Q all corroborated the bullish move quite nicely. The VIX only dropped about 2%, but it is well under 20 and we can’t ask for much more right now.
SPY is in a high base formation on the daily charts and appears to be setting up for a breakout to new 52-week highs. It would be very bullish for SPY to break out above 115 and make a run to the 120 area, also testing the upper trend line of the rising wedge formation on the daily chart. Do not jump in early though. Wait for a confirmed break out above 115 and a close above 115.50 on the conservative side. SPY is sitting at resistance at 115 right now and can just as easily turn around and head lower.
Look out for Housing Starts data as well as the Producer Price Index tomorrow as they can be market movers, perhaps even a catalyst for a breakout. Check your Bloomberg Economic Calender for more details on those two economic reports.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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