Monday, December 31, 2012

S&P 500 close 12/31

Seemlingly tragedy has been averted.  The framework for a deal has been laid out and the stock market rallied as rumors spread about the possibility even though the market closed without a deal in place.  Let's give it 36 hours to see some details and let the market digest the specifics.  It still has to be voted on and that could still get interesting.  The move today reversed the downturn in long term momentum indicator.  But it may take some follow up to maintain.  Still watching...

Friday, December 28, 2012

S&P 500 close 12/28

Another day another test of nerves for the market.  We started lower from the start, manage to stay above the 1410 convection area for most of the day and then dipped sharply lower at the close to finish at 1402.  Anything under 1400 and this gets ugly fast.  Ominous bad sign the long term momentum indicator is now headed lower.  But given that lawmakers are back on Sunday to take once last swing at this, this may be what the edge of the cliff looks like for the market.  Here that Washington, that the sound of America's collectively holding its breath.

Thursday, December 27, 2012

S&P 500 close 12/27

A lot of political drama and a wild ride by the markets today saw us finish basically where we started.  I would not trust too many moves by the market because news either way is going to lead to a knee jerk reaction.  Still sitting on the sidelines until they figure this out.

Wednesday, December 26, 2012

S&P 500 close 12/26

Market pushed lower today as Congress heads back to work tomorrow to try and come to an agreement before the new year.  Everyone will be probably be tuned in to any little sound bite that could provide some guidance on whether a deal will be in done in time.  Short term we are weakening with the long end still improving.  We have now retouched that weekly support line once again and anything below 1420 is really not a great technical signal with the head and shoulders back in play.

Friday, December 21, 2012

S&P 500 close 12/21

Well the Mayans were wrong after all, but Congress did there part to help them out.  The market sold off at the bell hit to hit a low of 1423 and then rallied to finish at 1430.  Honestly I am surprised the the support level held in the face of the news, but we did and that's all that matters.  Going forward, until we get some clarity from Washington, I may hold off on establishing a long position even though the market may leave without me.  Short term momentum has definitely lightened up in the face of the Congress's indecision.  Long term still looks good.  Next week is going to be interesting with a shortened week, lighter volume and Congress returning on the back half to maybe come to a solution.

midday 12/21 market update

Overnight surprise by our elected "leaders".  Usually the market can weather bad news, but incompetence from Washington is probably another matter. I guess the market cant hold up in the face of a Congress induced recession.  Let's be honest it probably shouldn't.  So I am reluctantly going back to yellow-yellow until these quacks get this straightened out.

Thursday, December 20, 2012

S&P 500 close 12/20

Textbook move by the markets today.  After an attempt to move lower in the morning, the market traded sideways until the bears relented and we pushed higher.  The market closed at 1443 up 7.   I do expect to trade sideways until the top value line moves up to the index.  Right now the top of the value is almost 1429.  Short term is improving, but again a little back and forth is probably expected.  Long term looks good.

Wednesday, December 19, 2012

S&P 500 close 12/19

Nice retrace today with the markets taking some profits off the table.  The market opened at the high of the day and gradually moved lower.  The close still puts it above the 1430 resistance level.  The value zone is a little lower at about 1425, so we could trade down a little bit from here and still be ok.  The start of bull markets are always pretty volatile and a retest of the previous resistance level is not out of the question.  If we move a little lower, I will look to put in a long trade and will start documenting them on a new page.  Long term the momentum is growing bullish, although still just south of breakeven.  Short term saw a slight slide in momentum with today's profit taking.

Tuesday, December 18, 2012

S&P 500 close 12/18

Anther good day for the markets.  We opened higher briefly ticked down to 1431 and then moved up strongly.  The market is setting up for a long run although I hope to buy on at least a little dip.  We are all green.

Monday, December 17, 2012

S&P 500 close 12/17

Very strong day by the markets today.  We rallied at the start and gradually moved higher to finish at 1430.  Things are looking up, I would like to see a close above 1430 to solidify the new trend, but looks promising.  Overall both the short term and long term technicals are improving.  Let's see if the market has some follow through tomorrow

Saturday, December 15, 2012

The Bond Bubble

Another good article from CNBC regarding fixed income.  It highlights the problem of having low interest rates for an extended period of time and the fact that so many people have chased yield as a means of return over the last couple of years.  It also highlights how difficult it can be to call a top in any bull market, especially when the rates are being manipulated by a government agency.

Friday, December 14, 2012

S&P 500 close 12/14

Not a good day for the markets. We finished near the lows of the day at 1413. We are near a couple of important technical levels now. First we are very near the convergence zone of 1400-1410. If we move back just a little we should retest 1400. Second we are now touching the weekly trend line, albeit still on the upside of it. Third, the sideways moves reinforces the weekly head and shoulders pattern that may be trying to form. On a more positive note, we are now back in the "value zone" of two moving averages that help track trends. If we can bounce from here even just a little it may give us the momentum to move more positively. However, pushing south of them and things do not look so good. Technical indicators have the short term weakening and long term although still improving, they are slowing down.

Thursday, December 13, 2012

S&P 500 close 12/13

So we failed to breakout above 1430 and pushed lower to close at 1419. Tomorrow becomes important because of the weekly close level. If we close sideways we move back into the weekly head and shoulders pattern. However, if we move up toward 1430 the likelihood of the pattern becomes considerably less. Although one day/week is not going to make or break any large move. Nonetheless, the clock is ticking on the market. For those who want to see how the market fights over an important technical level, look at the first hour of trading today. If you can look at a minute chart and you will see the bulls and bears trying to fight for control.

Wednesday, December 12, 2012

S&P 500 close 12/12

So to use a baseball analogy today was a foul ball. Not quite a strikeout, but pretty close and just barely alive. After starting the day up above 1430 and getting help from the Fed to move much higher, we still retreated to 1428 at close. Within striking distance of 1430, but not enough to feel comfortable. We have had a number of up days in a row, so it may be a little bit of a break. But then again, it is cause for some concern. With two days left this trading week, we need to see some upside determination to move forward.

Waiting to buy (or sell)

So I wanted to quickly touch on a subject that I thought was completely ludicrous when I first started looking at technical analysis as a possible investment strategy: the breakout.
Stocks move in trends and trading ranges with corresponding support and resistance levels. On most occasions, attempts to break an existing level fails, whether it is support or resistance. These are characterized as false breakouts. A false breakout is when the price moves through the level only to see the move fade late in the day.
False breakouts happen more often than not. That is why a close beyond the level is important. It is also why markets/stocks trade in trading ranges a good bit of the time. These levels have numerous shares traded at these prices over time and moving past them is a pretty big feat. The longer an investment or index stays at a certain level the more difficult it is to get past it. Once it does occur the liklihood that the investment/index pushes back through the level is unlikely.
As you can imagine a good number of people tend to buy before the resistance level is taken out. As a result, most people end up buying high and selling low.

Tuesday, December 11, 2012

S&P 500 close 12/11

Pretty good day for the bulls today. Rallied at the start and then moved above 1430 for most of the day. We reversed late in the day moved down to 1424 but finished at 1428. So feeling pretty good about this market but want to see a close above 1430 to go all green. I will post tomorrow, in addition to my normal close post, regardless of the day's move to explain why waiting for a higher price to buy is sometimes a good move.

Monday, December 10, 2012

S&P 500 close 12/10

Another tight range by the S&P today.  We could not make it above 1420 for long and traded down slightly in the middle of the day.  Technicals are the same incrementally improving long term momentum and a flattening of the short term indicators.  We need to break up beyond 1425 to get out of this possible head and shoulders pattern.  Sideways is not a good sign at these levels.

Saturday, December 8, 2012

Where is everybody and market sentiment?

I found this article on stock market participation while perusing CNBC's website. It is a pretty good summation on how sentiment of investors is not necessarily tied to the performance of the market.  It is  a good example of how people have a hard time managing the emotional aspects of their investing...

Friday, December 7, 2012

S&P 500 close 12/7

OK so this is not what I expected. We got a decent jobs report today. There were a few issues but overall better than what a lot of people expected. But the market really did not move too much. Normally with the daily chart pattern I would be green-green on the market and investments, but the overlying issue of a possible weekly head and shoulder pattern is causing a lot of reservations. The pattern will complete itself if we cannot get above 1425ish and begin to head down. I would feel better about the market if we get above 1430, which is a big resistance level. I would be very bullish at that point. For those who are interested in the pattern, its initial shoulder is mid march-april highs with the head forming in late sept-early october. If we cannot make it past the previous shoulder (march-april) pricing then things look pretty ugly. Normally I would be bullish but this pattern is just too strong with a number of enforcing elements suggesting that it might happen. I am cautiously optimistic, but not willing to risk capital for a small upswing followed by a major downturn. This makes next weeks trading very important.

Thursday, December 6, 2012

S&P 500 close 12/6

So we ticked up a little toward the close to finish up 4 to just shy of 1414. Tomorrow morning's jobs report might just be the catalyst to get this thing moving. Expectations are low since it will factor in Sandy' effect on the market. Technicals have not changed.

Wednesday, December 5, 2012

S&P 500 close 12/5

The market is beginning to get restless. After a decent attempt to push lower below 1400, the market rallied to 1415 before finishing the day at 1409. Apple was the big mover today down over 6% for the day, making the Nasdaq the big loser of the day. Overall still the same sentiment with a slowly eroding short term momentum and incremental improvement to the long term. Still anybody's game. The market is winding itself to move impressively, whenever that may be.

Tuesday, December 4, 2012

S&P 500 close 12/4

More of the same... a weak attempt at 1400 combined with a failed late effort on 1410 leaves us in the exact same spot. Short term momentum is weakening and long term is strengthening although still inside bearish territory. Although it typically is bad practice to try and guess the move of the market (it's best to let the market move and then react) we may be forming a head and shoulders pattern with a very small right shoulder. Like everything else, let the market move one direction or another and then I'll get out of cash.

Monday, December 3, 2012

S&P 500 close 12/3

Nice try by the bulls early. The market rallied at the start, got to 1422 and then gave it all back. The market finished lower closing at 1409, which puts it back in the 1400-1410 convergence zone. Still a little top heavy short term but I would not expect anything convincing. We probably retest 1400 since the bulls have run out of steam. The move from here (once it happens) will probably be significant. Long term the bulls are getting a little stronger but still the market is on the bearish side of strength. Happy in cash.

Friday, November 30, 2012

S&P 500 close 11/30

Very uneventful day. The market was completely listless today oscillating in a 6 point trading range. In the short term the up side looks more vulnerable even though we maintained above 1410. There is no conviction in the market so I am still yellow on the market and currently in cash 100%. Long term metrics are improving but still skeptical since the overall weight of the long term market technicals are still slightly bearish. Perfect time to stay on the fence until we figure this out...

Thursday, November 29, 2012

S&P 500 close 11/29

Good move for the bulls with a close above 1410. We retested later in the day and finished at 1415. Expect a retest tomorrow and will need it to hold to become bullish. One cause for concern is momentum is slowing down to the upside. Need another close above 1410 to feel secure about going long. Long term charts are still a little weak so still concerned about a prolonged move.

Wednesday, November 28, 2012

S&P 500 close 11/28

Strong day for the bulls. After fending off an early assault by the bears which saw the S&P 500 down 12 to 1385, the market rallied back to 1409 closing at the high of the day. Short term we are still a little overbought and the long term outlook has turned neutral we will probably try to rally beyond 1410 tomorrow. I am still yellow because we finished again in the 1400-1410 range. Still looking for conviction north of 1410 or south of 1400 to get me off the fence. The bears had their shot today, let's see what the bulls can do tomorrow. If we push through 1410 convincingly, 1430 is the target.

Tuesday, November 27, 2012

S&P 500 close 11/27

Seesaw day for the market with the averages between the trading range of 1400-1410 for most of the day.  Will need to see some follow through by the bears tomorrow and push a little lower below the close of 1398 to be convincing that we are headed south again.  The move early tomorrow may set the stage for the day and subsequently the next couple of weeks.  If we close below 1400 I will probably move my market indicator to red with a target of 1375.  My investments will stay yellow unless we get a strong move down.

Monday, November 26, 2012

S&P 500 close November 26

So I am officially yellow on the market right now.  I am use to getting conflicting messages and making decisions but with today's market I do not mind being in cash.  With a retest of 1400 twice and the market moving higher toward the end of the day, I would normally be bullish if the larger market was not in a different pattern.  The short term has us overbought, the long term technicals still hinting lower and the bond market actually moved up in price (down in yield) which all says bearish.  Technically we are above the psychological 1400 but below the 1410 level that acted as support in early November. If we move with determination one way or the other tomorrow I will favor that side of the market.  Should be interesting

Saturday, November 24, 2012

S&P 500 close 11/23

So this is the worst part about being a bear: big price moves on very low volume days.  S&P 500 closed at 1409 so above the resistance level of 1400 and definitely out of its technical ranges for a bear move.  However, the charts still say we move lower, and with the low volume (over the three days) the move up is not technically that strong.  I think we definitely retest 1400 and probably 1375 pretty quickly.  After that we either bounce off 1375 and start the Santa rally or we'll be staring at 1350. 

Thursday, November 22, 2012

Article about a new twist in personal investing

I found this article about investment advice on cnbc: I like the direction Alexa is going. I have had experience with bundled low cost financial planning and it typically lacks an individual touch. But let's she what she can make of it

S&P 500 close 11/21

Another pretty tight range leading to a small gain of 3 for the S&P 500. Nothing much has changed. Long term still has strong bearish signals and short term is growing slightly weaker. Light volume dictated the trading day so not much can be derived from the move. Next week should be interesting with the EU leaders in Brussels trying to figure out Greece. Have a Great Thanksgiving America!

Tuesday, November 20, 2012

S&P 500 close 11/20

We'll call this a draw. S&P crisscrossed between positive and negative without much determination. Which gives an option B for this week: No one is going to commit to large decisions during the holiday week. I would probably expect more of the same tomorrow. Indicators are looking a little shaky short term and have the same bearish strength long term. I'm leaving my market at red for the time being. I still expect a retest down to some degree but it will probably be next week.

pre-market footnote from last night's post

The S&P 500 ticked up to that weekly trend line that I have been referring to. It also touched a newer resistance line that has formed with the recent downturn. We should know pretty quickly which direction the market wants to go.

Monday, November 19, 2012

Stock Picking and the Stock Market

I came across the article on CNBC's website:  It hit on a couple of topics that I feel are a growing trend in the investing arena.  Although it does premise active investing is on its way out, I feel this occurrence would only be relegated to institutional level investors and managers.  It does touch on the differing facets of ETFs and the demise of stock picking in general.

S&P close 11/19/2012

Strong day with the S&P 500 finishing up 29 at 1386.  Brings us to the top of the bearish range.  The market needs to hold above 1375 to maintain the momentum.  VIX got crushed down to 15.24.  This where it gets tricky, indicators are still pointing bearish.  The next two days will be interesting with light volume expected because of the Thursday holiday.  If we begin to falter I think we will tank down to 1350 in a hurry.  1400 is the resistance level at the moment.

Friday, November 16, 2012

S&P 500 close Friday November 16

Pretty nice bounce after retesting 1350 twice early in the day.  Support and resistance are now 1350 and 1375 with 1382 being the top of the bearish range.  Short term the market is showing a little strength but the longer term actually looks worse even with the pop today.  The aggregate move Monday/Tuesday will go a long way in determining the week next week.  The VIX is probably the most interesting sinking strongly down to 16.41 which suggests everyone is ok with what is happening.

Thursday, November 15, 2012

S&P 500 close November 15 2012

Although the market was down it held above 1350 after testing it twice and one of those the last half hour of trading.  The S&P 500 is still holding in its oversold condition.  I think we could bounce a little off these levels but probably expect a retest of 1350 first.  The VIX was essentially flat today, holding at 18.  Still a very orderly sell off and no panic moves.  Long term sentiment has not changed.

Wednesday, November 14, 2012

S&P 500 close 11/14/2012

Yeah pretty ugly.  S&P was down 19 with not much of a fight to hold 1375.  Next congestion point is 1350 with 1330 now in play on the yearly fibonacci retrace.  All indicators are growing more bearish.  Market is still technically oversold, but it really does not seem to care.

Tuesday, November 13, 2012

S & P 500 close November 13

Bad news bulls.  They took the morning with a strong rally back to 1388 and then gave it all back with the S&P 500  finishing down 3.  Short term and long term are now both bearish.  S&P broke below a yearly trend line that I mentioned in an earlier post, Could get ugly tomorrow

Monday, November 12, 2012

Monday November 12 S&P500 close

Pretty tight 7 point trading range as the market tries to sort itself out.  Long term indicators still very bearish but the short term looks like we could get a little pop.  Retrace target is almost 1400.  Anything weaker and we could start selling again.

Saturday, November 10, 2012

Stock Market and the Media

One of the things that bothers me is the overwhelming amount of media that suggests bearish moves are over or that the stock market has hit a bottom.  This morning I came across this article on CNBC's website: It's title is: "Did the S&P Bottom Thursday? Yes, says the VIX" It lays out some obscure pattern that supports their assertion.  This is my problem with the article.  First the VIX is only at 18.61 and has not breached 20 at any time during this last down turn suggesting that the selling has been orderly; which means its likely to continue. You typically need some sort of capitulation type move in the market with a VIX spike to signal a bottom.  During our last selloff in June 2012 for example the VIX nearly hit 28.  Second the stock market is effectively sitting on a 13 month support line that originated in October 2011.  This is our fourth touch which generally would be supportive if we were to bounce off of it.  It's too early to tell and would never feel comfortable calling a bottom at the very bottom.  That just does not happen.  Finally there are a number of other longer term technical indicators that suggest this move down is far from over.  With some indicators pointing to a move that could last for months.  This is one of the reasons that I never give myself price targets (aside from resistance and support levels) I tend to follow what the indicators tell me and the visability with these is typically not more than a few days

Friday, November 9, 2012

Friday November 9, 2012

Very weak retest back to 1490 on the S & P.  Traded their briefly and then fell back into the 1480s for most of the day fading to 1479 by close.  Long and short term technical patterns are growing increasingly bearish.  Did not add any positions since the retest was not substantial.  Market is still oversold with 1398 now the retest stock market on the upside.  Need to move with conviction above 1480 (probably on Monday) or 1475 will get taken out.  Still yellow on investments because of the weak retest. 

Thursday, November 8, 2012

Thursday November 8, 2012

So not much of a retest. The S & P 500 bounced above 1400 for less than 10 minutes when the stock market opened this morning and then pushed noticeably lower.  Still looking for a bounce of some nature just to confirm the bearish trend.  Will not add to my bearish ETF until we get a little technical bounce.  The next Fibonacci retraces are at 1371 and 1350 although i'm more concerned about 1375 which has a good amount of volume being a previous resistance level.

10:50am EST Thursday November 8, 2012

 Update from last nights entry.  They S& P 500 is much lower than its bearish range.  It could correct back up to 1410 and close and still suggest weakness.  1400 is still the critical level but a couple of days from 1395 to 1405 would not be unexpected.  Will update after market close

Wednesday, November 7, 2012

Wednesday November 7, 2012

So the S & P  got to 1400 faster than I thought, traded through it to 1390 and then settled back to 1400 for most of the day.  a bit of a push down at the end to finish at 1394.  we will probably retest back to 1400 and see if there is any support if we finish below 1400 tomorrow, it could get ugly in a hurry

Tuesday, November 6, 2012

Tuesday November 6, 2012

Election Day and the market was up strong with the S & P finishing at 1428, up 11.  It finished however below the technical resistance level of 1130 after trading above it for some of the day.  Futures as of 10:32pm EST point to a decline tomorrow.  Market needs to close above 1430 to break bearish pattern otherwise we will probably test 1400 shortly. 

Monday, November 5, 2012

Monday November 5, 2012

S&P 500 bounced off 1410 and moved slightly higher throughout the day closing at 1417.  I bought some put protection today for my bearish ETF in case of an incumbent defeat tomorrow and a republican rally.  All signs still point to a bearish move in the market especially with the rate on the 10 year bond ($TNX) moving down to 1.68 from 1.72.  Expect an uneventful day tomorrow ahead of the election tomorrow night.

Sunday, November 4, 2012

Friday November 2, 2012

Fair employment report helped move the S & P 500 up above 1430, but was not able to hold and market moved down and closed near the lows at 1414.  Market unable to penetrate and hold above 1430 signaling increasing weakness.  Huge congestion zone from 1400-1413 if market moves and closes below 1400, further downside expected.