Approaching Resistance

We're running back to the top of the channel again, and approaching resistance once again at the 1100 level of the S&P 500. There was some good economic data out of China and Australia were among the reasons given for today's rally, as well as modestly better-than-expected weekly jobs data in the U.S.

Of course as has been the case lately, today's rally coincides with another rally in the euro, which regained the 1.2100 level for the first time in a week.

The Seven Sentinels are starting to look promising again, but I'm not trading off them for the moment given the past month's volatile action coupled with dire global economic conditions. We have to remember we really are in uncharted territory, so historical references are not as reliable as they might otherwise be.

Here's today's charts:



NAMO and NYMO are both flashing buys again.



NAHL and NYHL are also flashing buys.



I put up 2 year charts here to show how low the TRIN reading was today. It's in the dirt. Both signals are flashing buys, but are showing overbought conditions.



A bit of a turn for BPCOMPQ today, but it remains on a sell. Look at that step ladder from its highs. Those last two whipsaw buy signals are clear in this chart. Are we setting up for a third?

So 6 of 7 signals are flashing buys, which "technically" keeps the system on a buy. As I stated earlier, I am not playing any signals in this market for the time being. The Seven Sentinels are not fast enough to match the volatile action and neither is our TSP accounts. I am long term bearish, but anything can happen near term. That's it for this evening. See you on freaky Friday.

 

[Frixxxx]

I've stayed in just on "uncharted" territory reasoning. So, I'm taking a risk and buying in to this area......I'm praying for a 20-25% run and that's a 12,500 Dow by the EOY!

 

[Boghie]

I just want to pass the Single Cell critter.

Then, maybe sit the rest out on a purty Lilly Pad


Other than Obama fluttering about I don't see a whole lotta negative out there. The Europeans will have to hide assets somewhere. Why not here.

Somewhere in August through October da'Boyz will be cashing out. Who wants to give the tax man an additional 5% - 20%.

 

[coolhand]

I've stayed in just on "uncharted" territory reasoning. So, I'm taking a risk and buying in to this area......I'm praying for a 20-25% run and that's a 12,500 Dow by the EOY!

At the moment I am neutral. Uncharted territory in this case comes with a lot of unknown risk. No country seems immune to this debt contagion and highly risky derivatives are still in play in euroland. I can't trade based on these unknown risks, which is why I like using the SS, but at the moment the SS system is paralyzed due to volatility. If I can discern a good entry point with reasonable risk, I may take another position. But it won't be strictly on the SS. This market needs to settle down, and somehow I don't think that's going to happen for some time.