Weakness Resumes

True to recent form, today's market action was largely a function of dollar direction, and it's been an inverse relationship. The dollar gained 0.8% on the day, while the major averages suffered moderate losses. Of course that doesn't include our "I" fund as it took it on the chin as a result of the dollar rally. The "I" fund fell 1.42% as result.

Given today was OPEX, I'll not try to pin today's trading on anything specific. So let's go to the charts:



NAMO and NYMO both dropped back under their respective 6 day EMAs, which means they flipped back to a sell condition.



So too did NAHL and NYHL.



TRIN and TRINQ both flipped to sells as well today.



BPCOMPQ managed to tick just barely higher today, but remains in a sell condition. If it can get back above that lower bollinger band it will turn back to a buy. But that's a big "if" and even if it does get above it, there is still reason to question whether it can remain there.

If you were keeping count, you'll notice that all signals are now flashing sells, which puts the Seven Sentinels into an "unconfirmed" sell condition. That's three times we've seen an unconfirmed sell issued since its last buy signal, but the system has yet to confirm that sell condition with a fresh 28 day trading low from NYMO. And the market hasn't really gone anywhere in all that time either, so it's not really a surprise.

But I consider it a protracted warning just the same.

Check back in Sunday evening for the latest Tracker charts. I'll see you then.

 

[mayday]

BPCOMPQ is trending down.
As the old saying goes (The trend is your friend).

 

[coolhand]

That's the foundation of this system. In a less manipulated market I'd be much more concerned, but that's not to say I'm bullish by any means.

BPCOMPQ is trending down.
As the old saying goes (The trend is your friend).

 

[Boghie]

CoolHand,

You know what is wild...

From the 30,000 foot view, we are sitting in a tiny trading range. We are off by just 2.8% on the 52 week high (S&P500).

Folks are still too scared - based on the crash three/four years ago.

Folks are now too spoiled - remembering 30% gains in 2009 and 16% gains in 2010.

To me, it looks as if we are talking about a good - but normal - market. Maybe an annual gain of 12% - 15% with normal trading patterns.

 

[Sensei]

CoolHand,

To me, it looks as if we are talking about a good - but normal - market. Maybe an annual gain of 12% - 15% with normal trading patterns.

That sounds about right to me. At the end of 2010, I was reading some WSJ editor's predictions for 2011 - apparently he accurately predicted the S&P's performance last year, and his prediction for this year was that it would end at 1400. I did the math at the time, and I think it worked out to an 11% gain.

 

[airlift]

There is so much uncertainty impacting the markets these days, that IMO we will see quite a big %centage drop going forward, and then those of us in G or F will be able to buy the stock funds for a real hefty gain later this year. Good luck to all.

 

[coolhand]

I have a real hard time using the word "normal" when talking about this market. :cheesy: But I wouldn't argue anyone's position on what kind of gains (or losses) we might see in the major averages by years end. I tend to agree with you though, that we'll see higher prices before we close out the year.

CoolHand,

You know what is wild...

From the 30,000 foot view, we are sitting in a tiny trading range. We are off by just 2.8% on the 52 week high (S&P500).

Folks are still too scared - based on the crash three/four years ago.

Folks are now too spoiled - remembering 30% gains in 2009 and 16% gains in 2010.

To me, it looks as if we are talking about a good - but normal - market. Maybe an annual gain of 12% - 15% with normal trading patterns.