It would seem we had a great rally today. The S&P and Wilshire Completion index moved up 1.34% and 2.15% respectively. The I fund would have done fairly well too if the dollar hadn't rallied, but it's just one day and that could change quickly.
I was feeling pretty good about a continuation higher next week as the day progressed, even with the end of day profit taking that we saw. But there's a couple of things troubling me about this rally right now. First is this chart:
See what happened the last two trading days? Even with today's seemingly robust move higher GS was down 1.86% today. It is possible that they are front running a decline by selling into strength.
This may be an important indicator as Goldman Sachs is considered a cornerstone of the market. Many traders believe they know where the market is headed because they have inside information. It's easy to see why they feel that way too. After all they've been around since 1869 and are a cornerstone of our banking system to include a major trading component as well. Plus, former Goldman Sachs employees such as Henry Paulson and Robert Rubin have held high positions in the federal government, regardless of which party was in the White House.
See the connection? I'll leave it at that.
Second on my list of worries is that the seven sentinels are weaker now than they were yesterday. They are just barely holding on in spite of today's rally.
If we rally Monday it should breath a little more life back into those signals, but this rally has gone far in a very short period of time. A decline Monday may force a sell signal, but not necessarily. We may be getting close though even with a rally.
I am not sure what to expect right now, except my radar is up and I'm trying to determine how much leg this rally has left. We may have more upside as strength has been phenomenal, it could go on longer than I think at this point. But if GS continues to sell in the face of a rally I'll be getting nervous. I may even consider front running a SS sell signal, at least partially.
Maybe I'm getting a little ahead of myself here, and I still think we have more upside coming, but it may require a bout of selling before the uptrend resumes. It might even mean an Intermediate Term reversal. But I've seen the SS get whipsawed in the last few months and that combined with our 2 IFT limit makes for pretty tricky decision making.
This market is defying a lot of seasoned professionals and I'm not calling a top here, but as a market timer I am trying to maximize gains. So far, so good with this last trade. I don't want to give it back.
I was feeling pretty good about a continuation higher next week as the day progressed, even with the end of day profit taking that we saw. But there's a couple of things troubling me about this rally right now. First is this chart:
See what happened the last two trading days? Even with today's seemingly robust move higher GS was down 1.86% today. It is possible that they are front running a decline by selling into strength.
This may be an important indicator as Goldman Sachs is considered a cornerstone of the market. Many traders believe they know where the market is headed because they have inside information. It's easy to see why they feel that way too. After all they've been around since 1869 and are a cornerstone of our banking system to include a major trading component as well. Plus, former Goldman Sachs employees such as Henry Paulson and Robert Rubin have held high positions in the federal government, regardless of which party was in the White House.
See the connection? I'll leave it at that.
Second on my list of worries is that the seven sentinels are weaker now than they were yesterday. They are just barely holding on in spite of today's rally.
If we rally Monday it should breath a little more life back into those signals, but this rally has gone far in a very short period of time. A decline Monday may force a sell signal, but not necessarily. We may be getting close though even with a rally.
I am not sure what to expect right now, except my radar is up and I'm trying to determine how much leg this rally has left. We may have more upside as strength has been phenomenal, it could go on longer than I think at this point. But if GS continues to sell in the face of a rally I'll be getting nervous. I may even consider front running a SS sell signal, at least partially.
Maybe I'm getting a little ahead of myself here, and I still think we have more upside coming, but it may require a bout of selling before the uptrend resumes. It might even mean an Intermediate Term reversal. But I've seen the SS get whipsawed in the last few months and that combined with our 2 IFT limit makes for pretty tricky decision making.
This market is defying a lot of seasoned professionals and I'm not calling a top here, but as a market timer I am trying to maximize gains. So far, so good with this last trade. I don't want to give it back.
