Archive for August, 2009|Monthly archive page
Selling into Monday’s close shows a tired Bull.
When prices have a harder time holding higher ground the market usually corrects.
Tha’t what’s pretty much behind the candlestick theory of charting anyway.
But we’re not candlestick analysts. In fact, we love watching their signals get crossed.
But we are watching for further evidence to suggest sellers will take control.
A high volume sell-off would be just the sign.
But as always we’ll wait for the market to do the talking…
Modest rally Tuesday.
No volume, nothing really to pull from it other than market visibly appears to be in pullback mode.
In that case, we’re watching the 50-day moving average as a logical zone for support.
But more importantly, we want to see if volume dries up as a sign heavy sellers aren’t interested.
Wednesday’s sharp turn around from recent selling undoubtedly caught some Bears off guard.
Lot’s of smart money folks out forecasting lower prices for the major indexes.
Reality is we’re still very much living in a Bull’s script.
Accumulation of shares from institutions has been a dominant theme for this market.
But weakness in Tech shares for the past couple weeks could be a precursor for broader action to come.
The market isn’t straying much from its Bullish footing.
Despite just a little ground lost among the major indexes volume was light, which means there weren’t a lot of eager sellers.
Perhaps as a stronger sign of institutional selling interest are the pullback to the 50-day average for Semiconductors, as seen on the SMH, and heavy selling in retailers.
We’ll let the evidence weigh heavier for the Bears before changing our Buyer’s Caution bias.
Bearish reversal bars on the daily chart of the major indexes looks ominous.
But we’ve been here before in this market.
Just when it looks like things are going to turn down it heads higher.
We’re not frustrated or anticipating anything at this juncture.
The market does whatever it wants whenever it wants.
Should further evidence stack up to the Bearish bias we’ll adjust our bias accordingly.
For the record, that was Distribution posted on the Dow and Nasdaq.
More upside for the Bull.
What we consdider modest volume on the day led to one of Accumulation for the Nasdaq.
Whenever volume on an up day comes in higher than the day before we consider that a sign of institutional interest for stocks, or Accumulation.
No telling what might knock this rally off its tracks.
We’re just sitting back and watching the wheels go by.
Odds are we’ll see the market set opportunity, long or short, when the falls comes in…
It only goes up.
That seems to be the dominant feeling that has crept back into the minds of market watchers.
After four months of advances for a mind-blowing 50% gain on the S&P 500 the Bull’s strength can’t be ignored.
It’s not our job as breakout growth stock traders to call tops and bottoms.
We merely recognize when the market’s good for buying or it isn’t.
Last week we started to see Distribution from leading stocks, which could be a sign that the Bull may be ready for a pullback as investors take some off the table.
The S&P’s 1,000 mark that was hit today is a key psychological level.
We expect to see some volatility come in to play this week…