FP Stock Market Challenge

at 9:21 PM

TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)

Long-term 3 of 3 are BUY

Intermediate 3 of 3 are SELL 5 of 6 are NEUTRAL SPY ST Model is in SELL mode

Short-term 1 of 1 are SELL 9 of 9 are NEUTRAL

BULLISH 6.3.2c Major Distribution Day Watch: Bottom is close?
0.0.9 Extreme Put Call Ratio Watch: *Bottom is close?
2.0.0 Volatility Index (Daily): *3 reversal bars in a row, VIX may pullback.

BEARISH 6.3.0 Major Accumulation/Distribution Days: Another Major Distribution Day ahead?

CONCLUSION

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING VEHICLE: SSO/SDS, UPRO/SPXU

ST Model 02/04 S 1.9 x ATR(10)

Reversal Bar 02/04 S *Stopped out short position flat.

NYMO Sell

VIX MA ENV

OTHER ETFs TREND COMMENT – *New update. Click BLUE to see chart if link is not provided.

QQQQ

IWM

CHINA Down Double Top or Bearish 1-2-3 Formation?

EMERGING Down

CANADA Double Top, target $15.77.

FINANCIALS Down Could be a confirmed Head and Shoulders Top.

REITS Measured Move, target $41.54. *Stick Sandwich pattern confirmed.

MATERIALS

ENERGY Down Confirmed Double Top.

OIL Could be a Double Top in the forming.

GOLD Down Descending Triangle, target $91.08.

DOLLAR UP Head and Shoulders Bottom, target $24.28.

BOND 3.0.0 10Y T-Bill Yield: Bearish 1-2-3 formation, target 34.43.

INTERMEDIATE-TERM: INITIAL PULLBACK TARGET MET BUT COULD BE MORE

No update, see 02/05/2010 Market Recap, Fib 38.2% retracement target was met, but I suspect there’s more. There’s a chance that after the pullback is over, we’ll see a new high followed by a bigger pullback thereafter.

SHORT-TERM: MARKET MAY VERY CLOSE TO AT LEAST A SHORT-TERM BOTTOM

See table above, two additional bullish signals were added, therefore chances are increasing significantly that the market may very close to at least a short-term bottom. But still there’re 2 concerns. Firstly, 6.3.0 Major Accumulation/Distribution Days, the Major Distribution Day seldom comes alone, in another word is that there could be another big sell off ahead. Secondly, 6.4.A SPY Bottom Shape, see chart below, comparing to the past bottom shape, do you think the current shape look like a bottom? So the conclusion is, a bottom (could be either short-term or intermediate-term) should be very close but the market may test 02/05 low first. Of course, the market could keep rising from here, if so, because the low is not tested, it’s not easy for the market to stand only on one foot, therefore it cannot go too far, eventually will have to come down at least to test the 02/05 low. If this is the case, then for sure, the 02/05 low is only a short-term bottom.

The three bullish signs mentioned above are listed below.

6.3.2c Major Distribution Day Watch, NYDNV:NYUPV > 35, usually a bottom is very close.

0.0.9 Extreme Put Call Ratio Watch, see green rectangles.

2.0.0 Volatility Index (Daily), three reversal bars in a row so VIX is very likely to pullback which means that SPX will rise.

STOCK SCREENER: For fun only, I may not actually trade the screeners. Since SPY ST Model is in SELL mode, only SHORT candidates are listed. For back test details as well as how to confirm the entry and set stop loss please read HERE. Please make sure you understand the basic risk management HERE.

Today’s screener has 0 stock found.

According to the entry rule, BRCM found yesterday wasn’t confirmed.

at 5:23 PM

I have no idea about tomorrow. According to the chart below, looks like in which direction (up or down) a gap is opened tomorrow morning will determine the fate of bulls and bears. My guess is more likely it’s going to be a gap down because the market has opened with a gap up 3 days in a row.

at 8:17 PM

TREND INDICATOR MOMENTUM INDICATOR COMMENT (Click link to see chart)

Long-term 3 of 3 are BUY

Intermediate 3 of 3 are SELL 5 of 6 are NEUTRAL SPY ST Model is in SELL mode

Short-term 1 of 1 are SELL 6 of 9 are NEUTRAL

BULLISH 6.3.2c Major Distribution Day Watch: Bottom is close?

BEARISH 6.3.0 Major Accumulation/Distribution Days: Another Major Distribution Day ahead?

CONCLUSION

SPY SETUP ENTRY DATE STOP LOSS INSTRUCTION: Mechanic signals, back test is HERE, signals are HERE.
TRADING VEHICLE: SSO/SDS, UPRO/SPXU

ST Model 02/04 S 1.9 x ATR(10)

Reversal Bar 02/04 S breakeven

NYMO Sell

VIX MA ENV

OTHER ETFs TREND COMMENT – *New update. Click BLUE to see chart if link is not provided.

QQQQ 0.0.5 QQQQ Short-term Trading Signals: Falling Three Methods, bearish continuation 71% time.

IWM

CHINA Down Double Top or Bearish 1-2-3 Formation?

EMERGING *Down Bearish 1-2-3 Formation, target $36.34.

CANADA Double Top, target $15.77.

FINANCIALS *Down Bearish 1-2-3 Formation, target $13.40. *Could be a confirmed Head and Shoulders Top.

REITS Measured Move, target $41.54. *Could be a bearish Stick Sandwich pattern.

MATERIALS *Could be a bearish Stick Sandwich pattern.

ENERGY *Down *Confirmed Double Top.

OIL Could be a Double Top in the forming.

GOLD Down Descending Triangle, target $91.08.

DOLLAR UP Head and Shoulders Bottom, target $24.28.

BOND 3.0.0 10Y T-Bill Yield: *Bearish 1-2-3 formation, target 34.43.

INTERMEDIATE-TERM: INITIAL PULLBACK TARGET MET BUT COULD BE MORE

No update, see 02/05/2010 Market Recap, Fib 38.2% retracement target was met, but I suspect there’s more. There’s a chance that after the pullback is over, we’ll see a new high followed by a bigger pullback thereafter.

SHORT-TERM: FALL ON DECREASED VOLUME USUALLY IS NOT A SIGN OF BOTTOM

Nothing to say, but since now the report contains more and more data in the table above (I hope you like the idea) and the stock screener (which, I guess, you’re unsatisfied. Don’t worry, my screener for longs should be very good. For shorts, actually, I think bearish ETF is much better.), so I have to find something to say everyday. And here comes what I made up today: 0.0.2 SPY Short-term Trading Signals, fell on decreased volume plus not many oversold signals, so I tend to believe the market is not bottomed yet.

If the market is not bottomed, then beware of the next prophecy: 6.3.0 Major Accumulation/Distribution Days, Major Distribution Day seldom comes alone, this means there’ll be at least one panic sell to new low ahead, unless a Major Accumulation Day steps in first.

STOCK SCREENER: For fun only, I may not actually trade the screeners. Since SPY ST Model is in SELL mode, only SHORT candidates are listed. For back test details as well as how to confirm the entry and set stop loss please read HERE. Please make sure you understand the basic risk management HERE.

Today’s screener has 1 stock. Just please don’t forget the entry rule, it’s not a short yet.

Well, no bullish Monday. But at least after the last bearish Monday, the rest of the week wasn’t bad. And it’s true, it’s very rate for INDU to have red weeks 4 weeks in a row, and it’s the 5th week now, so suppose we should have an intra-week reversal and eventually have a green week?

Just still want to remind you the chart below, a little bit old but should enough to see that the rest of the week after the Monday wasn’t so promising in the past.

I have no idea what’s going to happen next. Past experience says a scary sell off for at least two more days to wash all the weak hands out then a few weeks rebound thereafter. Anyone wants to say that because so many people are expecting panic sell, so there’ll be no panic sell?

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