Well we now know the answer to that question, the mkt. likes the fact that the Fed is going to leave the rates low for an extended period of time. The mkts. didn’t love it, it just liked it about 3/4 of a percent. So now tomorrow pre-open we will have to digest the PPI news, and then crude inventory shortly after the open. I am expecting a directional day tomorrow, but I don’t think we will know that direction until after the open. Looking at most of the charts, the breakout appears to be in tact. In fact, I have come to the realization that if I had just looked at my charts, no news, no outside data, just stuck my head in the sand and poked it out to look at charts, then the buy signals would’ve been clear. I talked about them often over the past few months, but with chagrin and doubt because of my great intellect ( heavy sarcasm). Yet I have always traded trying to keep on eye on the behind the scenes activity, not whats on CNBC, the real news. This past few months that has been a detriment to me and my trading. Now I am mad, let’s look at charts:
As I suggested yesterday, I didn’t trust those top wicks on the VIX. She dropped all right, but then today we get the number one mixed signal, a huge top wick / bottom tail candle with a gap fill. So now this could be ripe for a bounce.
The INDU actually had decent v today on a small up day. That is a slight change of pattern as most v peaks have led to selling. You can see right now it is on the under belly of the bottom channel line and above support. Looking strictly at this chart, I would buy on a breakout above the channel line, or after a re-test of the 10521 line.
The SPX had a very nice breakout today, and I wouldn’t be surprised to see an inside day tomorrow, maybe even a little of a down day. Again, strictly looking at the chart, this looks very strong to me.
The NAS stalled out a bit the last couple of days, but looks poised to continue its move up. It is set up similar to early February, the one big difference, that was after a prolonged down move, this is a prolonged up move. Still, as we all know, pull backs are healthy for prolonged up moves, and we did close above Friday’s open all bullish type of signals.
The XSD triggered an alert and this is either setting up as a double top or breakout. It will depend on what the COMPQ does. It is currently overbought, but can stay that way for a while.
Another alert triggered on ETR. You can see the breakout, but if you look at the RSI it shows over-bought and turning down. However, notice the highlighted sections and you will see the RSI likes to hang out over-bought for a month at a time. So this could be a sign of things to come.
Well finish with one of my favorite things in the whole world, wingys. Love me some buffalo wings. This more than filled gap and rallied to the recent highs. Today it had an inside day with a spin top doji. This can serve as a decent reversal signal.
In closing: Looking strictly at charts, this mkt. looks poised to have another breakout. However, I would like to see a small pullback before I go headlong bullish. The pre-market news should give us a signal of which way to trade. I will be looking for the post open reversal that leads to a primary direction. Trade well and prosper. AKOT
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