The markets formed a doji in week one of 2012. This is a sign of indecision and could be expected at the onset as traders and hedge funds begin to pick up trading again in the new year. That being said it is the long term investors which drive the long term trend of the markets. Aside from the intraday and a few small daily trends, we have really gone nowhere in the past year. We saw a few longs…
Grab the RSS Feed to have the daily watch list delivered via email. The #1 thing I learned about the markets is that anything can happen. No matter what the data says should happen, doesn’t mean it will happen. There is no one on the planet who can predict the market to 100% certainty so I won’t claim to do so here. What I would like to do is take a look at 2012 and look at some possible scenarios…
We saw heavy selling these passed two weeks on increasing volume. Look to sell into any rally if we see a decline in volume. A true rally will coincide with a massive drop in the VIX. Above we have the four top line figures, SPY, DIA, QQQ, and IWM (from left to right). Notice the increasing volume noted by the darker green and the incredibly large percent down days in the markets.
As talked about in the April 28th post we are targeting 1390s on the S&P500. You can see that we’ve pulled back once again halfway back and the old resistance has acted as new support. Option max pain for the SPY is 134 as of May 10 (prior highs) so we have a clear line in the sand if we should fail out of our move higher.
We’re looking for a rally to 1390, however before we do so we may pullback into the next daily halfway back setup.
The ES, or the E-mini S&P Futures hit a pivotal level on 4/18 which has sent the market screaming higher. As we continue to drive higher and break prior highs, more and more stops will be hit which in turn sends the market high. We need sellers at highs to make new highs and buyers and lows to make new lows. This is because the stops that the sellers place at highs (just about the highs) will be fuel for…
Well spaced news for the upcoming week. We are anticipating a rally this week at least in to the 1082s on the /ES. If we move up and break 1093 then we will look to buy the first major pullback. The top traders and hedge fund managers should be coming back from holiday after Labor Day and the market action should really start to pick up again.