Uptrend's Account Talk

[Uptrend]

RPM: I don't use weekly charts, because that is like looking in a rearview mirror. The market has already moved. I don't even like the slow sto that much, but do use it in combination with other indicators. In the chart below:

View attachment 3672

First we see all kinds of chart resistance above. This is a tall order for the upwave to continue, and the 20 dma is also there (not shown). Second, we have already make a 125 point rise from 1253 to 1379. Previous upwaves in this bear market have been 120 and 101. There is no reason to believe we will get more of a run. Third, look at the slow sto. It is in the overbought area and is topping out with a broad top. Looking backwards on charts with slow sto shows that normally with double slow slow tops the market goes down big in a few trading days. Fourth, look at the ADX. Notice my arrows and see that the red and green directionals are going in the same direction or down. This is not healthy. Notice how the green crossed through the red when we had the big 3% gain last Tuesday, but now is trending down. This reason the market cannot maintain its direction, IMO is because of overhead resistance. Fifth, to set up for another run up, the market needs to consolidate going down toward the 50 dma. The consolidation the last few days has been up. This is not good. Bull flags have a big rise (the pole) and then consolidate down a few days (the flag) before another big push up. Bear flags have a big drop, and then consolidate up a few days. The upward consolidation I believe looks like a bear flag in the big chart figure I showed in my last post.

Conclusion: The market cannot sustain it-self for very long. A bonds play is coming soon within a few days.

 

[airlift]

Note:

I don't know how important it really is but the S&P500 is getting resistance at the EMA(100). I have read some TA analysts give this a high degree of importance.

 

[Uptrend]

Strategy Desk:

Assumptions:
1 Options X next week should move against the major market trend.
2 Market is a tight trading range, the last 5 days, with a little consolidation now. After 6-7 trading days there is usually a release.

Facts:
1 Strong support below at 1350 ($spx) area. 20 and 50 ema are starting to converge.
2 Strong resistance at 1383, and at various points above. This was penetrated yesterday, but could not hold above. As with airlifts observation, the 100 ema is crossing there as well for extra chart resistance.
3 Not much to move the market in earnings reports next few days (Circuit City, Greentech, Rite-Aid). Consumer sentiment on Friday might be a mover.
4 Market moving back to nuetral from overbought.

Possible Bounce Play:
I am starting to think that we will retrace for one more day towards 1350, and then blast off on Thursday, Friday and Monday. That should put us in the 1410 area of resistance. Then the whipsaw action goes on from next Tuesday-Friday and Options X goes against the trend (down). The Elliot wave wouild then top out at about 1410, a 157 point rise off the 1253 lows, before a retreat to the 1300 area when the main slug of earnings come out.

 

[RPM]

Strategy Desk:

Possible Bounce Play:
I am starting to think that we will retrace for one more day towards 1350, and then blast off on Thursday, Friday and Monday. That should put us in the 1410 area of resistance. Then the whipsaw action goes on from next Tuesday-Friday and Options X goes against the trend (down). The Elliot wave wouild then top out at about 1410, a 157 point rise off the 1253 lows, before a retreat to the 1300 area when the main slug of earnings come out.

Are you planning to get back in tomorrow? Thanks for all your analysis.

 

[SteveTSP]

Uptrend,
Thanks for posting your thoughts and strategy. I have been sitting at the computer trying to figure out what to do before the noon deadline and your thoughts rang true to what I have been thinking about the last couple of days. Appreciate your thoughts and the guts to put them out there!
Steve

 

[Uptrend]

View attachment 3685

As the market recovered in 2003, look at the bull flag that formed. The 100, 50 and 20 ema are shown. Notice that the first time the 100 ema was punched through that the market went back down to form the flag, resting on necktie of the 20 and 50 day ema The next time the market went above the 100 ema and then came back for a retest before going on an uphill slope along the 20 ema.

View attachment 3686

Does this look familiar? First we see a pattern of not one, but 2 bull flags. We also see the 20 and 50 ema moving closer and closer together. We also see that the 100 ema was pierced yesterday.

Putting this evidence together with futures tonight trading slightly lower meaning a little more consolidation and downward fake-out for the uninformed, and then off to the races Thursday?

Also NYSE new lows have been diminishing the last few days. Today only 25 (anything below 28 considered good), yesterday only 5. Means the market is gathering some strength, although the new highs are still on the low side; 41 vs 80-100 needed for a bull advance.

I will probably go C/S tomorrow. In rearview analysis, I should have stayed in, but it's hard to always know.

 

[RPM]

View attachment 3685

I will probably go C/S tomorrow. In rearview analysis, I should have stayed in, but it's hard to always know.

As usual, thank you very much for the analysis.

 

[SteveTSP]

Uptrend,
Thanks again for the update. I am moving back into C and S fund today also. Do you have any thoughts on your planned fund allocation?
Steve

 

[Uptrend]

C is looking stronger. Some other technical data I watch suggests that Russell is a little weaker than the large cap. So I am thinking 60-70 C/30-40 S.

This market should be trading a little more down in a sideways pattern towward the 50 ema, but just refuses to give up strength. The more down today the better. I would even like to see tomorrow start off down (but staying above 50 ema) and then reverse. The Elliot wave count now suggests that there is another push up from 1313 on March 31. This would be wave 5 with a top at 1410-1416, a near perfect 50% retracement from the highs. And we all know what happens after a wave 5 advance - down she goes.

I am also intrigued by market releases - we are now working on day 6 of sideways trading, since the last big jump. Remember, when Trader Freds commentary was free for the looking. He was graphing these releases, but they were unkown to him why they occur, and the direction. Suspect if one could figure it out - would make them rich!

 

[SteveTSP]

Uptrend,
I really appreciated your inputs on your planned IFT today. Unfortuntely, I had to run to a mtg before your reply. However, I was inline with your thoughts (by accident) with my IFT going 40% C and 60% S. I originally was going 30 and 70 but changed my mind at the last minute for no sound justification but gut feel. It looks like that you went the 70 / 30 split (OBTW, concur with your approach) and wishing you the best on your projection. I only hope that I don't gink you since my last several moves have been very poor and was not patient enough to weather the short down turn. This followed by extreme concern to minimize risk of lost and thus lack of potential recovery.
Thanks again, Steve

 

[Uptrend]

We have a beautiful bull flag, sitting right over 20 and 50 ema support The chart formation could not be better! Get ready for the big move up. Tomorrow we have the Yahoo-AOL merger talks, has pushed the futures up to spx 1361 tonight. Le'ts keep er going. GE earnings look good for Fri, First Call is up 0.51 vs 0.44 last year. Any spark and we are going off to the upside. Let's roll!

 

[SteveTSP]

Great news and hopefully the market will cooperate. I'm in!

 

[RPM]

We have a beautiful bull flag, sitting right over 20 and 50 ema support The chart formation could not be better! Get ready for the big move up. Tomorrow we have the Yahoo-AOL merger talks, has pushed the futures up to spx 1361 tonight. Le'ts keep er going. GE earnings look good for Fri, First Call is up 0.51 vs 0.44 last year. Any spark and we are going off to the upside. Let's roll!

Great call as usual! Thanks very mucho

 

[SteveTSP]

Uptrend,
GE report not so good. Any changes planned today or Monday? I am not sure other than to hold.
Steve

 

[Uptrend]

I have to admit I did not see the GM stock crusher coming, but it was mostly the financial dept.and an over reaction. Good way to scare the bulls and bring on the bears. But look,there is a short squeeze coming - look at the spx chart:

View attachment 3712

After studying this chart for awhile, I have to say I am gravitating towards the inverse H&S camp. Look at the great support line beneath todays close, and formation of the right shoulder. The bull flag downward consolidation angle is textbook. Notice the breakout line above, and stochastics going toward overbought.

So what does all this mean? Some say a breakdwon; but I say a breakout!

 

[Uptrend]

Oops
On the last post and chart, I meant the stochastics are going toward short-term oversold.

 

[Uptrend]

Friday's market down day caused by GE missing expectations by 7 cents. What a ruse - I don't believe it - The market is getting to rally BIG -perhaps all the way to the 200 ema. See my posts below.

What others are saying:

http://www.cnbc.com/id/24068384

 

[SteveTSP]

Uptrend,
Thanks for your feedback. Allot of negative thoughts out there but concur with you. I wish I had more patience but will hope to stick this one out for a while and hold instead of running out of stocks.
Thanks much for your thoughts, SteveTSP

 

[Uptrend]

Look at the ISEE sentiment index. There is a positive bias in the last few weeks.

"The ISE Sentiment Index is a unique put/call value that only uses opening long customer transactions to calculate bullish/bearish market direction. Opening long transactions are thought to best represent market sentiment because investors often buy call and put options to express their actual market view of a particular stock."

http://www.ise.com/WebForm/viewPage.aspx?categoryId=126&header3=true&menu0=true&link1=true


Stats:

Average yesterday 114

10 day ma 4/01 -4/14 101

20 day ma 3/17 - 4/14 100

50 day mv 2/01 - 4/14 94

52 week high 10/29/2007 192

52 week low 3/10/2008 56

Conclusion: Sentiment has seen the low in March and is slowly rising. It appears we are starting to change from nuetral of the last few weeks to the positive direction. This is a bullish sign. Sorry bears.

 

[Steadygain]

Man, thanks Uptrend you can't imagine how much your words mean to me. I really appreciate it!!