Chat - 10/16/12 - Technical Watch Forum

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Technical Watch > Categories > Chat & Breadth Archives > Chat - 10/16/12

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fib_1618

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Posts: 4,959

Posted 1350479760	Reply with quote #1

2012-10-16 16:00:20 [Message] fib_1618 -> Chat: good day 2012-10-16 16:00:23 [Message] fib_1618 -> Chat: how is everyone? 2012-10-16 16:01:49 [Message] sp 112358 -> Chat: Well thank you, and you? 2012-10-16 16:02:15 [Message] fib_1618 -> Chat: doing fine...thanks for asking! 2012-10-16 16:02:27 [Message] fib_1618 -> Chat: OK...any questions or comments before we get started?? 2012-10-16 16:02:52 [Message] sp 112358 -> Chat: Just one question... 2012-10-16 16:03:05 [Message] fib_1618 -> Chat: you can have more than one... 2012-10-16 16:03:12 [Message] sp 112358 -> Chat: In the Weekly Breadth report, you wrote ..." the expectation from there will be for another "run" to new price highs in many of the major market indices both domestically and globally into the 1st quarter of 2013." Can you go through how you came up with that timing of Q1-2013? 2012-10-16 16:03:42 [Message] fib_1618 -> Chat: that was two weeks ago, right? 2012-10-16 16:03:51 [Message] sp 112358 -> Chat: This weekend 2012-10-16 16:03:56 [Message] fib_1618 -> Chat: let me check 2012-10-16 16:04:04 [Message] fib_1618 -> Chat: time and space are fleeting me these days 2012-10-16 16:04:05 [Message] fib_1618 -> Chat: one sec 2012-10-16 16:04:45 [Message] fib_1618 -> Chat: ahhh... 2012-10-16 16:04:47 [Message] fib_1618 -> Chat: ok 2012-10-16 16:05:06 [Message] fib_1618 -> Chat: some of it was based on the preceding quote 2012-10-16 16:05:51 [Message] fib_1618 -> Chat: "with the interest rate sensitive A/D lines continuing to promise higher prices in the future" 2012-10-16 16:06:05 [Message] fib_1618 -> Chat: so the blueprint becomes 2012-10-16 16:06:25 [Message] fib_1618 -> Chat: that we're likely to either bounce off or snapback to the accelerated advancing A/D lines 2012-10-16 16:06:31 [Message] fib_1618 -> Chat: and then test the longer term rising bottoms lines 2012-10-16 16:06:45 [Message] fib_1618 -> Chat: and since the Bond and Preferred A/D's continue to make new highs 2012-10-16 16:06:51 [Message] fib_1618 -> Chat: once that challenge is met 2012-10-16 16:07:05 [Message] fib_1618 -> Chat: we should see higher price highs into the 1st quarter of 2013 2012-10-16 16:07:20 [Message] fib_1618 -> Chat: the "canary in the coal mine" is an important idea here 2012-10-16 16:07:31 [Message] fib_1618 -> Chat: the canary being the Bond and Preferred lines 2012-10-16 16:07:39 [Message] fib_1618 -> Chat: as long as they continue to make higher highs 2012-10-16 16:08:07 [Message] fib_1618 -> Chat: this shows that liquidity is plentiful to absorb a more robust correctional period of more than a couple of days 2012-10-16 16:08:21 [Message] fib_1618 -> Chat: and once we move back to our "mean" 2012-10-16 16:08:37 [Message] fib_1618 -> Chat: we should be constructive enough to see higher price highs in the major market indices 2012-10-16 16:09:06 [Message] fib_1618 -> Chat: that is unless we start seeing continued strength over the next week or so 2012-10-16 16:09:23 [Message] fib_1618 -> Chat: then we'll likely move into higher highs for the next several months 2012-10-16 16:09:33 [Message] fib_1618 -> Chat: and again peaking out sometime in the 1st quarter of 2013 2012-10-16 16:09:57 [Message] fib_1618 -> Chat: one things for sure... 2012-10-16 16:10:09 [Message] fib_1618 -> Chat: we continue to be in an intermediate term uptrend at this time 2012-10-16 16:10:26 [Message] fib_1618 -> Chat: but there are more and more indications that we're likely to trend sideways for a while 2012-10-16 16:10:51 [Message] sp 112358 -> Chat: It is the timescale that I don't get..- how you arrived at that... 2012-10-16 16:11:12 [Message] fib_1618 -> Chat: what is the usual amount of time that the MCO remains above or below its zero line? 2012-10-16 16:11:21 [Message] sp 112358 -> Chat: 6 weeks 2012-10-16 16:11:37 [Message] fib_1618 -> Chat: OK...so far we've been below the zero line for 2 weeks? 2012-10-16 16:11:40 [Message] fib_1618 -> Chat: let me check 2012-10-16 16:11:59 [Message] fib_1618 -> Chat: on and off for a month 2012-10-16 16:12:16 [Message] fib_1618 -> Chat: looking at the NYSE breadth MCSUM 2012-10-16 16:12:25 [Message] fib_1618 -> Chat: we see that we're still way above the zero line here 2012-10-16 16:12:35 [Message] fib_1618 -> Chat: with a +541 reading today 2012-10-16 16:13:00 [Message] fib_1618 -> Chat: each 250 mark on the MCSUM usually takes a week to move to the next level (with all things being equal) 2012-10-16 16:13:11 [Message] fib_1618 -> Chat: so if we are in a correctional pattern 2012-10-16 16:13:23 [Message] fib_1618 -> Chat: the MCSUM will take about 2 weeks to move to zero from here 2012-10-16 16:13:36 [Message] fib_1618 -> Chat: you have to figure that there's going to be a bounce - maybe a week - off the zero line 2012-10-16 16:13:52 [Message] fib_1618 -> Chat: and then a move below the zero line as we attempt to wash out the weak hands 2012-10-16 16:14:02 [Message] fib_1618 -> Chat: another week to the -250 level 2012-10-16 16:14:25 [Message] fib_1618 -> Chat: so based on our moving in a "straight line" it will take about a month for us to move to the -250 level 2012-10-16 16:14:46 [Message] fib_1618 -> Chat: add about a week for November holidays in the US 2012-10-16 16:14:57 [Message] fib_1618 -> Chat: and that puts us at the end of November 2012-10-16 16:15:24 [Message] fib_1618 -> Chat: if capital gains taxes are going to increase next year here in the states 2012-10-16 16:15:39 [Message] fib_1618 -> Chat: we'll probably see continued weakness into December OPEX 2012-10-16 16:15:45 [Message] fib_1618 -> Chat: bottom 2012-10-16 16:15:53 [Message] fib_1618 -> Chat: and then rally into the 1st quarter 2012-10-16 16:16:18 [Message] fib_1618 -> Chat: so a little technical...a little fundamental...and a little bit of experience 2012-10-16 16:16:50 [Message] sp 112358 -> Chat: OK, thanks, I see the logic of it now. 2012-10-16 16:16:52 [Message] fib_1618 -> Chat: keep in mind that my comments on the weekend data tends to be more "sweeping" than what we talk about in here 2012-10-16 16:17:29 [Message] fib_1618 -> Chat: I take the chat and the breadth data charts as two different angles of analysis 2012-10-16 16:17:31 [Message] sp 112358 -> Chat: I recognize that they are broader 2012-10-16 16:17:47 [Message] fib_1618 -> Chat: the chat is more for fine tuning 2012-10-16 16:18:01 [Message] fib_1618 -> Chat: but it's based on the larger degree of trend in which the weekend charts provide 2012-10-16 16:18:22 [Message] fib_1618 -> Chat: and as long as the two compliment each other 2012-10-16 16:18:26 [Message] fib_1618 -> Chat: in the final analysis 2012-10-16 16:18:35 [Message] fib_1618 -> Chat: then our confidence is higher on our blueprint 2012-10-16 16:18:40 [Message] fib_1618 -> Chat: example 2012-10-16 16:18:51 [Message] fib_1618 -> Chat: if the Bond and Preferred were declining here 2012-10-16 16:19:04 [Message] fib_1618 -> Chat: then the expectation of higher price highs isn't as confident 2012-10-16 16:19:28 [Message] fib_1618 -> Chat: as this would mean that liquidity...the amount of cash available to push prices higher...was draining from the system 2012-10-16 16:19:33 [Message] fib_1618 -> Chat: now 2012-10-16 16:19:45 [Message] fib_1618 -> Chat: this doesn't necessarily mean a top either 2012-10-16 16:19:51 [Message] fib_1618 -> Chat: as we have seen over the decades 2012-10-16 16:20:07 [Message] fib_1618 -> Chat: that just an emotional spark is sometimes that's all that's needed for prices to move to new highs 2012-10-16 16:20:20 [Message] fib_1618 -> Chat: the example here is the 1999 rally in the NASDAQ 2012-10-16 16:20:35 [Message] fib_1618 -> Chat: where the NASDAQ breadth MCSUM remained below its zero line for much of the rally 2012-10-16 16:20:49 [Message] fib_1618 -> Chat: and basically moved sideways between the zero line and the -250 level 2012-10-16 16:21:10 [Message] fib_1618 -> Chat: but in this case 2012-10-16 16:21:20 [Message] fib_1618 -> Chat: as long as the Bond CEF continues to make higher highs 2012-10-16 16:21:35 [Message] fib_1618 -> Chat: it PROMISES us that we will see higher stock prices in the not too distant future 2012-10-16 16:21:41 [Message] fib_1618 -> Chat: just as you have seen in the past 2012-10-16 16:21:53 [Message] fib_1618 -> Chat: and under some of the worse conditions one could imagine 2012-10-16 16:22:52 [Message] fib_1618 -> Chat: anyway...I try to be as reasonable in that review as possible given what we have to work with 2012-10-16 16:23:12 [Message] fib_1618 -> Chat: the other thing that helps in this kind of forecast 2012-10-16 16:23:49 [Message] fib_1618 -> Chat: is that we have the global markets (AORD, DAX and FTSE) showing the same kind of bullish configurations right now 2012-10-16 16:24:04 [Message] fib_1618 -> Chat: one would think that if we were looking at a longer term top 2012-10-16 16:24:22 [Message] fib_1618 -> Chat: a top in which Armageddon was upon us 2012-10-16 16:24:44 [Message] fib_1618 -> Chat: that we would at least showing some inconsistencies in these individual market places outside of the US 2012-10-16 16:25:54 [Message] fib_1618 -> Chat: anyway...I hope I answered your question 2012-10-16 16:26:00 [Message] fib_1618 -> Chat: thanks for asking 2012-10-16 16:26:04 [Message] sp 112358 -> Chat: Yes thank you 2012-10-16 16:26:13 [Message] fib_1618 -> Chat: anyone else? 2012-10-16 16:26:37 [Message] fib_1618 -> Chat: how did we do today anyway...let me check 2012-10-16 16:26:54 [Message] fib_1618 -> Chat: up 127 on the Dow 2012-10-16 16:27:14 [Message] fib_1618 -> Chat: and we have now basically erased all of last weeks decline in two days 2012-10-16 16:27:16 [Message] fib_1618 -> Chat: not bad 2012-10-16 16:27:40 [Message] fib_1618 -> Chat: also notice if you will 2012-10-16 16:27:44 [Message] fib_1618 -> Chat: where we found support 2012-10-16 16:27:49 [Message] fib_1618 -> Chat: right on the 50 day EMA 2012-10-16 16:28:02 [Message] fib_1618 -> Chat: which reaffirms the intermediate trend as being higher 2012-10-16 16:28:42 [Message] fib_1618 -> Chat: though the MID and SML pattens remain a bit soft here 2012-10-16 16:28:50 [Message] fib_1618 -> Chat: OK...let me get DP up and we'll get started 2012-10-16 16:29:34 [Message] fib_1618 -> Chat: after finding support around the -50 level 2012-10-16 16:29:52 [Message] fib_1618 -> Chat: the NYSE CO breadth MCO has not only snapped back to its zero line 2012-10-16 16:29:57 [Message] fib_1618 -> Chat: but it closed above it today 2012-10-16 16:30:12 [Message] fib_1618 -> Chat: and also closed above the recent highs seen on the chart 2012-10-16 16:30:22 [Message] fib_1618 -> Chat: this should be enough of a push to move the NYA index to higher highs 2012-10-16 16:30:48 [Message] fib_1618 -> Chat: or at the very least another challenge of the 8500 level 2012-10-16 16:31:12 [Message] fib_1618 -> Chat: we also generated a crossover buy signal today on the NYSE CO breadth components 2012-10-16 16:31:25 [Message] fib_1618 -> Chat: but they remain below last weeks highs 2012-10-16 16:31:31 [Message] fib_1618 -> Chat: so between the two 2012-10-16 16:31:46 [Message] fib_1618 -> Chat: we continue to show money flow as being somewhat out of sync here 2012-10-16 16:32:24 [Message] fib_1618 -> Chat: similar to back firing on a car when the spark plugs aren't exactly sitting square 2012-10-16 16:32:39 [Message] fib_1618 -> Chat: looking at the CO NYSE breadth MCSUM 2012-10-16 16:33:02 [Message] fib_1618 -> Chat: and this spurting effect is likely to give us a classic ledge pattern 2012-10-16 16:33:22 [Message] fib_1618 -> Chat: and that should then give way to our eventual test of the MCSUM zero line 2012-10-16 16:33:45 [Message] fib_1618 -> Chat: so lets continue to call it a trading range 2012-10-16 16:33:56 [Message] fib_1618 -> Chat: with 8250 on the low side and 8500 on the high side 2012-10-16 16:34:18 [Message] fib_1618 -> Chat: and we're now in the process of a transverse to the top of the range 2012-10-16 16:34:25 [Message] fib_1618 -> Chat: at this point 2012-10-16 16:34:37 [Message] fib_1618 -> Chat: and unless we continue to see better money flow here 2012-10-16 16:35:05 [Message] fib_1618 -> Chat: this will likely be our tradable high that we've expecting for the last month for the middle of October 2012-10-16 16:35:36 [Message] fib_1618 -> Chat: with any new price highs showing bearish divergences with price and the NYSE CO breadth MCO 2012-10-16 16:35:48 [Message] fib_1618 -> Chat: on the flip side 2012-10-16 16:36:05 [Message] fib_1618 -> Chat: we have challenged and successfully held our snapback to what was the price highs of last spring 2012-10-16 16:36:17 [Message] fib_1618 -> Chat: and we are about to re-initiate the rally higher 2012-10-16 16:36:28 [Message] fib_1618 -> Chat: so as we talked about last week 2012-10-16 16:36:42 [Message] fib_1618 -> Chat: shorts should had been hit and run affairs and all positions should be out for now 2012-10-16 16:37:00 [Message] fib_1618 -> Chat: while holding longs with trailing stops 2012-10-16 16:37:19 [Message] fib_1618 -> Chat: moving to the composite NYSE breadth MCO 2012-10-16 16:37:26 [Message] fib_1618 -> Chat: and here too we closed above the zero line 2012-10-16 16:37:37 [Message] fib_1618 -> Chat: but we did NOT take out the previous highs of a couple of weeks ago 2012-10-16 16:38:21 [Message] fib_1618 -> Chat: you will notice though that this snapback did come in right where needed for the buyers to hold the +500 level on the composite NYSE breadth MCSUM 2012-10-16 16:38:33 [Message] fib_1618 -> Chat: as was our expectation from last week 2012-10-16 16:39:03 [Message] fib_1618 -> Chat: we also see that we have a crossover buy signal here on the NYSE breadth MCO components 2012-10-16 16:39:35 [Message] fib_1618 -> Chat: but we're still in need of some additional follow through to turn this technical bounce into something more longer lasting 2012-10-16 16:40:15 [Message] fib_1618 -> Chat: this is also a good example of how the level of MCSUM can help us in determining in what we can expect from prices at any given time 2012-10-16 16:40:25 [Message] fib_1618 -> Chat: here we have the MCSUM above the +500 level 2012-10-16 16:40:47 [Message] fib_1618 -> Chat: which would make it difficult for the sellers to mount up anything more than just a couple of days of decline 2012-10-16 16:41:06 [Message] fib_1618 -> Chat: before the "basketball in the deep end of the pool" was released 2012-10-16 16:41:15 [Message] fib_1618 -> Chat: and whoosh...up we went today with a gap 2012-10-16 16:41:45 [Message] fib_1618 -> Chat: moving to the NASDAQ breadth MCO 2012-10-16 16:41:59 [Message] fib_1618 -> Chat: and here we have just about made a full snapback to the zero line 2012-10-16 16:42:29 [Message] fib_1618 -> Chat: and this again is slowing the rate of descent in the NASDAQ breadth MCSUM as it approaches its zero line 2012-10-16 16:42:56 [Message] fib_1618 -> Chat: we also see that both of the NASDAQ MCO components not only remain below their zero line 2012-10-16 16:43:06 [Message] fib_1618 -> Chat: but we remain on a crossover sell there 2012-10-16 16:43:15 [Message] fib_1618 -> Chat: so between the two marketplaces 2012-10-16 16:43:21 [Message] fib_1618 -> Chat: we are definitely out of sync 2012-10-16 16:43:32 [Message] fib_1618 -> Chat: and we are also still seeing weakness overall 2012-10-16 16:43:51 [Message] fib_1618 -> Chat: and when a pattern "smells" it can mean only one thing 2012-10-16 16:44:06 [Message] fib_1618 -> Chat: yes...an Elliott "B" wave 2012-10-16 16:44:20 [Message] fib_1618 -> Chat: just as we discussed last week as one of our options from our "oversold" condition 2012-10-16 16:44:39 [Message] fib_1618 -> Chat: but at the same time 2012-10-16 16:44:53 [Message] fib_1618 -> Chat: the upside objective here for the NASDAQ is for another 50 points higher 2012-10-16 16:45:08 [Message] fib_1618 -> Chat: so we can't continue to be bearish against the rally...at least not yet 2012-10-16 16:45:21 [Message] fib_1618 -> Chat: my sense here is that 2012-10-16 16:45:36 [Message] fib_1618 -> Chat: with the ISEE going to a reading below 80 last week 2012-10-16 16:45:53 [Message] fib_1618 -> Chat: that we're likely to keep rather bouyant now into the Friday's OPEX 2012-10-16 16:46:08 [Message] fib_1618 -> Chat: to produce the maximum pain for both the call and put buyers 2012-10-16 16:46:32 [Message] fib_1618 -> Chat: for the calls...they peaked out on the 9/14 top 2012-10-16 16:46:47 [Message] fib_1618 -> Chat: for the puts...last weeks test of the NYA trading range 2012-10-16 16:47:12 [Message] fib_1618 -> Chat: so it's likely that stock prices are going to close somewhere in between the two on Friday 2012-10-16 16:47:56 [Message] fib_1618 -> Chat: we did see some nice buying again in the NDX breadth MCO today 2012-10-16 16:48:04 [Message] fib_1618 -> Chat: as it now tests its recent highs 2012-10-16 16:48:07 [Message] fib_1618 -> Chat: and at the same time 2012-10-16 16:48:23 [Message] fib_1618 -> Chat: the NDX components produced a crossover buy signal today as well 2012-10-16 16:48:30 [Message] fib_1618 -> Chat: as was our expectation from last week 2012-10-16 16:48:48 [Message] fib_1618 -> Chat: we are in the process of trying to hold in and around the -250 level on the NDX breadth MCSUM 2012-10-16 16:49:00 [Message] fib_1618 -> Chat: with today's reading of a -304 2012-10-16 16:49:26 [Message] fib_1618 -> Chat: once we get our small snapback here to what was the horizontal pattern support we see on the chart 2012-10-16 16:49:38 [Message] fib_1618 -> Chat: we should then unwind to or towards the -500 level 2012-10-16 16:49:56 [Message] fib_1618 -> Chat: at least that's what the bears are hoping for here 2012-10-16 16:50:04 [Message] fib_1618 -> Chat: for the bulls 2012-10-16 16:50:16 [Message] fib_1618 -> Chat: in order for them to show a good turnaround 2012-10-16 16:50:30 [Message] fib_1618 -> Chat: we will need to see the NDX breadth MCSUM not only move above its zero line 2012-10-16 16:50:32 [Message] fib_1618 -> Chat: but with it 2012-10-16 16:50:51 [Message] fib_1618 -> Chat: it will need to take out this same resistance we saw in the pattern on its prior attempt to do just that 2012-10-16 16:51:28 [Message] fib_1618 -> Chat: the structure of the MCSUM also looks more of a "fishhook" than that of a "ledge" 2012-10-16 16:51:41 [Message] fib_1618 -> Chat: but we should know if it's a important turn or not by Friday 2012-10-16 16:51:56 [Message] fib_1618 -> Chat: for some of you... 2012-10-16 16:52:14 [Message] fib_1618 -> Chat: sitting on your hands last week in trying to short this puppy turned out to be the best plan 2012-10-16 16:52:38 [Message] fib_1618 -> Chat: higher highs in the SPX breadth MCO 2012-10-16 16:53:14 [Message] fib_1618 -> Chat: and I think it was this MCO where we talked about how neither side had much in the way of control of prices by the lack of texture we see in the MCO 2012-10-16 16:53:25 [Message] fib_1618 -> Chat: still the same scenario here as well 2012-10-16 16:53:41 [Message] fib_1618 -> Chat: where we see a minimal amount of structure here 2012-10-16 16:54:11 [Message] fib_1618 -> Chat: so it's unlikely that we're going to build too much more to make this move meaningful for the bulls 2012-10-16 16:54:47 [Message] fib_1618 -> Chat: looking at the SPX price chart 2012-10-16 16:55:05 [Message] fib_1618 -> Chat: and it looks like we're only 10 points away from new recovery closing highs again 2012-10-16 16:55:11 [Message] fib_1618 -> Chat: let me check 2012-10-16 16:55:42 [Message] fib_1618 -> Chat: yep...10 points 2012-10-16 16:56:02 [Message] thespookyone -> Chat: ? 2012-10-16 16:56:11 [Message] fib_1618 -> Chat: we closed today at 1455 2012-10-16 16:56:19 [Message] sp 112358 -> Chat: Do you think we did finished an "a of B" today on spx? 2012-10-16 16:56:20 [Message] fib_1618 -> Chat: the recent closing highs were 1465 2012-10-16 16:56:35 [Message] fib_1618 -> Chat: well...we're at a point in which something is going to give 2012-10-16 16:56:37 [Message] fib_1618 -> Chat: but remember 2012-10-16 16:56:46 [Message] fib_1618 -> Chat: it may not turn into a zig zag 2012-10-16 16:56:49 [Message] fib_1618 -> Chat: it could be a flat 2012-10-16 16:56:55 [Message] thespookyone -> Chat: ah, closing highs, forgot 2012-10-16 16:56:57 [Message] fib_1618 -> Chat: and a test of the old highs with little in the way of structure on the daily 2012-10-16 16:57:08 [Message] fib_1618 -> Chat: the key here though 2012-10-16 16:57:33 [Message] fib_1618 -> Chat: is whether or not there's enough energy coming in so that prices can first test and then move above these same highs or not 2012-10-16 16:57:39 [Message] fib_1618 -> Chat: so far...that answer is no 2012-10-16 16:57:47 [Message] fib_1618 -> Chat: but another day like today 2012-10-16 16:58:08 [Message] fib_1618 -> Chat: and that would extend the mid October period for a high forecast to next week 2012-10-16 16:58:28 [Message] fib_1618 -> Chat: but like we talked about earlier 2012-10-16 16:58:53 [Message] fib_1618 -> Chat: we're probably not going to do much more for the rest of the week because of the option specs 2012-10-16 16:59:40 [Message] fib_1618 -> Chat: do you know that the Dow is 60 points away from new highs here? 2012-10-16 17:00:04 [Message] fib_1618 -> Chat: during anticipated topping phases 2012-10-16 17:00:21 [Message] fib_1618 -> Chat: it's highly important that our focus remains with money flow and NOT with prices 2012-10-16 17:00:34 [Message] fib_1618 -> Chat: for as with every price top 2012-10-16 17:00:55 [Message] fib_1618 -> Chat: it's always done with lesser conviction by money 2012-10-16 17:01:07 [Message] fib_1618 -> Chat: so if we move to new price highs here 2012-10-16 17:01:09 [Message] fib_1618 -> Chat: so far 2012-10-16 17:01:29 [Message] fib_1618 -> Chat: there's still not enough short term money flow to keep prices moving in this same direction 2012-10-16 17:01:34 [Message] fib_1618 -> Chat: this will cause divergence 2012-10-16 17:01:56 [Message] fib_1618 -> Chat: and then a more constructive bottom will need to be built in order for something like this to actually occur 2012-10-16 17:02:21 [Message] fib_1618 -> Chat: OEX is 4 points away from new closing highs 2012-10-16 17:02:41 [Message] fib_1618 -> Chat: so although last weeks two decline was exciting 2012-10-16 17:02:49 [Message] fib_1618 -> Chat: much of it has been absorbed now 2012-10-16 17:03:03 [Message] fib_1618 -> Chat: and we're net sideways for the last couple of weeks 2012-10-16 17:03:06 [Message] fib_1618 -> Chat: now 2012-10-16 17:03:07 [Message] fib_1618 -> Chat: of course 2012-10-16 17:03:25 [Message] fib_1618 -> Chat: the MID and SML and NASDAQ are telling a slightly different story 2012-10-16 17:03:33 [Message] fib_1618 -> Chat: but isn't that how tradable tops actually form? 2012-10-16 17:03:49 [Message] fib_1618 -> Chat: without the broader market helping in keeping prices from declining? 2012-10-16 17:04:02 [Message] fib_1618 -> Chat: so until this configuration changes 2012-10-16 17:04:18 [Message] fib_1618 -> Chat: we should be comfortable with a top forming at this time 2012-10-16 17:04:20 [Message] fib_1618 -> Chat: now 2012-10-16 17:04:30 [Message] fib_1618 -> Chat: that brings up a more important question, doesn't it? 2012-10-16 17:04:35 [Message] fib_1618 -> Chat: and that would be 2012-10-16 17:04:49 [Message] fib_1618 -> Chat: how much downside is likely to be seen from this topping formation? 2012-10-16 17:04:59 [Message] fib_1618 -> Chat: well...so far...not much 2012-10-16 17:05:11 [Message] fib_1618 -> Chat: because we have the NYSE breadth MCSUM well above its zero line 2012-10-16 17:05:20 [Message] fib_1618 -> Chat: but the NASDAQ is below this same line 2012-10-16 17:05:32 [Message] fib_1618 -> Chat: so when the market is out of sync...what usually happens? 2012-10-16 17:05:40 [Message] thespookyone -> Chat: chop 2012-10-16 17:05:47 [Message] fib_1618 -> Chat: yes, and that's the expectation 2012-10-16 17:06:13 [Message] thespookyone -> Chat: fine with me 2012-10-16 17:06:18 [Message] fib_1618 -> Chat: and it should be 2012-10-16 17:06:37 [Message] fib_1618 -> Chat: this is why we switched to momentum oscillators last week 2012-10-16 17:06:59 [Message] fib_1618 -> Chat: Japan opened up 1%...Korea up .07% 2012-10-16 17:07:27 [Message] fib_1618 -> Chat: now... 2012-10-16 17:07:42 [Message] fib_1618 -> Chat: everyone will have their own time period working here 2012-10-16 17:07:50 [Message] fib_1618 -> Chat: but here's what we should be looking at overall 2012-10-16 17:08:09 [Message] fib_1618 -> Chat: let me upload a chart...one moment 2012-10-16 17:09:24 [Message] fib_1618 -> Chat: http://www.technicalwatch.com/chat12/nymo101612.png 2012-10-16 17:09:39 [Message] fib_1618 -> Chat: the link should take you to the NYSE breadth MCO 2012-10-16 17:09:51 [Message] fib_1618 -> Chat: with the full stochastic oscillator at the bottom 2012-10-16 17:09:58 [Message] fib_1618 -> Chat: yes? 2012-10-16 17:10:32 [Message] fib_1618 -> Chat: (hopefully) 2012-10-16 17:10:35 [Message] fib_1618 -> Chat: anyway 2012-10-16 17:11:00 [Message] fib_1618 -> Chat: its unlikely that the MCO is going to turn down again until we see a reading above the 80 level in the stochastic 2012-10-16 17:11:21 [Message] fib_1618 -> Chat: so if we use this daily information as a guide 2012-10-16 17:11:40 [Message] fib_1618 -> Chat: it should compliment whichever directional trade you're likely to make 2012-10-16 17:12:09 [Message] fib_1618 -> Chat: for example, you can use a 8 period RSI on a 15 minute chart 2012-10-16 17:12:21 [Message] fib_1618 -> Chat: and as it moves to and fro 2012-10-16 17:12:46 [Message] fib_1618 -> Chat: and we haven't reached the upper level in the MCO stochastic 2012-10-16 17:13:04 [Message] fib_1618 -> Chat: one should take a position on the buy side when the small period RSI moves to "oversold" 2012-10-16 17:13:17 [Message] fib_1618 -> Chat: and sell when it becomes "overbought" 2012-10-16 17:13:25 [Message] fib_1618 -> Chat: once the MCO stochastic tops 2012-10-16 17:13:37 [Message] fib_1618 -> Chat: then you can move to the daily since we're likely be diverging by then 2012-10-16 17:13:47 [Message] fib_1618 -> Chat: just a general primer 2012-10-16 17:13:57 [Message] fib_1618 -> Chat: use what works for you 2012-10-16 17:16:28 [Message] fib_1618 -> Chat: back to the charts 2012-10-16 17:16:40 [Message] fib_1618 -> Chat: moving to the OEX breadth MCO 2012-10-16 17:16:51 [Message] fib_1618 -> Chat: and here we have another example of our being "out of sync" 2012-10-16 17:16:59 [Message] fib_1618 -> Chat: with the SPX MCO moving to higher highs 2012-10-16 17:17:02 [Message] fib_1618 -> Chat: while the OEX has not 2012-10-16 17:17:21 [Message] fib_1618 -> Chat: so we should continue to expect choppy behavior here 2012-10-16 17:17:54 [Message] fib_1618 -> Chat: now if the buyers can capitalize on the crossover buy on the OEX components 2012-10-16 17:18:06 [Message] fib_1618 -> Chat: then we have a slightly different tune to play with 2012-10-16 17:18:21 [Message] fib_1618 -> Chat: but we KNEW last week that all we were to expect was a technical bounce 2012-10-16 17:18:39 [Message] fib_1618 -> Chat: yesterday was something like the "dead cat" variety 2012-10-16 17:18:47 [Message] fib_1618 -> Chat: but today made it more than that 2012-10-16 17:19:00 [Message] fib_1618 -> Chat: so maybe another day or two of firmness might be expected 2012-10-16 17:19:17 [Message] fib_1618 -> Chat: and that jives with our "going nowhere fast" idea for the rest of the week 2012-10-16 17:19:39 [Message] fib_1618 -> Chat: even the Dow breadth MCO was only able to snapback to its zero line 2012-10-16 17:20:05 [Message] fib_1618 -> Chat: and notice again how we're attempting to find support at the +250 level on the Dow breadth MCSUM 2012-10-16 17:20:24 [Message] fib_1618 -> Chat: moving to the MID breadth MCO 2012-10-16 17:20:28 [Message] fib_1618 -> Chat: and here we have higher highs 2012-10-16 17:20:38 [Message] fib_1618 -> Chat: and as we were talking about last week 2012-10-16 17:20:55 [Message] fib_1618 -> Chat: the internals here have all the ingredients of a potential bottom here 2012-10-16 17:21:17 [Message] fib_1618 -> Chat: with the rally from "oversold" finding zero line resistance 2012-10-16 17:21:31 [Message] fib_1618 -> Chat: moving lower and providing textural divergence 2012-10-16 17:21:46 [Message] fib_1618 -> Chat: and now back above the zero line in what can be described as a "breadth thrust" 2012-10-16 17:22:06 [Message] fib_1618 -> Chat: notice too how this is all occurring at the MID breadth MCSUM zero line 2012-10-16 17:22:41 [Message] fib_1618 -> Chat: so we should keep an eye on this basket of stocks here as to their potential for leadership 2012-10-16 17:23:06 [Message] fib_1618 -> Chat: for if the bulls can continue to build on this constructive MCO pattern 2012-10-16 17:23:17 [Message] fib_1618 -> Chat: and then take out the reversal bar at 1005 2012-10-16 17:23:32 [Message] fib_1618 -> Chat: this index could really move sharply higher from here 2012-10-16 17:23:45 [Message] fib_1618 -> Chat: and into new all time high territory 2012-10-16 17:24:06 [Message] fib_1618 -> Chat: the SML breadth MCO continues weaker than the MID 2012-10-16 17:24:26 [Message] fib_1618 -> Chat: but here too we did take out the recent highs seen at the beginning of the month 2012-10-16 17:24:34 [Message] fib_1618 -> Chat: so if the buyers can build on this 2012-10-16 17:24:41 [Message] fib_1618 -> Chat: and take this MCO back above the zero line 2012-10-16 17:25:17 [Message] fib_1618 -> Chat: this would then take us above the small blip resistance area we saw last month 2012-10-16 17:25:45 [Message] fib_1618 -> Chat: and a challenge of the September highs will be likely...if not more 2012-10-16 17:25:53 [Message] fib_1618 -> Chat: tough market 2012-10-16 17:26:09 [Message] thespookyone -> Chat: components not that fresh there, though 2012-10-16 17:26:17 [Message] fib_1618 -> Chat: where you can't just watch one thing to know everything that's going on 2012-10-16 17:26:35 [Message] fib_1618 -> Chat: true...zero line snapback there 2012-10-16 17:26:36 [Message] fib_1618 -> Chat: but they are moving in sync with the MCO itself 2012-10-16 17:26:57 [Message] fib_1618 -> Chat: if they take the lead 2012-10-16 17:27:16 [Message] fib_1618 -> Chat: that would be a bullish event 2012-10-16 17:27:28 [Message] fib_1618 -> Chat: like I said 2012-10-16 17:27:37 [Message] fib_1618 -> Chat: it's important that we look at everything here 2012-10-16 17:27:40 [Message] fib_1618 -> Chat: and lucky for us 2012-10-16 17:27:49 [Message] fib_1618 -> Chat: we have 3 straight days of chat this week to do just that! 2012-10-16 17:28:03 [Message] thespookyone -> Chat: sure, just looking at the tops below tops situation-and the zero hit 2012-10-16 17:28:14 [Message] fib_1618 -> Chat: where we'll be able to take this apart and see who's in control 2012-10-16 17:28:23 [Message] thespookyone -> Chat: will be great! 2012-10-16 17:28:37 [Message] fib_1618 -> Chat: but that's only part of the sequence here 2012-10-16 17:28:49 [Message] fib_1618 -> Chat: with the MCO and its components moving together 2012-10-16 17:29:11 [Message] fib_1618 -> Chat: it implies that there might be enough energy coming in now to break above these same tops 2012-10-16 17:29:31 [Message] fib_1618 -> Chat: again...it's a day to day thing here given how out of sync we are 2012-10-16 17:30:05 [Message] fib_1618 -> Chat: but I don't know too many times where the market has had a significant top while the MID and SML continue to carry a firm undertone to them 2012-10-16 17:30:21 [Message] fib_1618 -> Chat: and that's the important thing here 2012-10-16 17:30:30 [Message] fib_1618 -> Chat: if we are topping as is the suggestion of the NYSE breadth MCSUM 2012-10-16 17:30:46 [Message] fib_1618 -> Chat: then we should begin to show areas of breakdown moving into this same top 2012-10-16 17:30:57 [Message] fib_1618 -> Chat: and that, so far, isn't happening here 2012-10-16 17:31:59 [Message] fib_1618 -> Chat: and as expected 2012-10-16 17:32:08 [Message] fib_1618 -> Chat: the TM breadth MCO is also back up to its zero line now 2012-10-16 17:32:19 [Message] fib_1618 -> Chat: right on it, in fact 2012-10-16 17:32:26 [Message] fib_1618 -> Chat: so one side is about to take control 2012-10-16 17:32:33 [Message] fib_1618 -> Chat: place your bets 2012-10-16 17:32:36 [Message] fib_1618 -> Chat: 2012-10-16 17:32:46 [Message] fib_1618 -> Chat: moving to the volume oscillators 2012-10-16 17:33:06 [Message] fib_1618 -> Chat: CVI's still not climactic 2012-10-16 17:33:17 [Message] fib_1618 -> Chat: so there's room for some more emotional buying there 2012-10-16 17:33:40 [Message] fib_1618 -> Chat: and we'll call it neutral on the STVO's and VTO's 2012-10-16 17:33:44 [Message] fib_1618 -> Chat: and that means... 2012-10-16 17:33:52 [Message] fib_1618 -> Chat: one side is about to take control 2012-10-16 17:33:54 [Message] fib_1618 -> Chat: it also means 2012-10-16 17:33:58 [Message] fib_1618 -> Chat: that in 2 trading days 2012-10-16 17:34:14 [Message] fib_1618 -> Chat: we have returned to neutral...buyers and sellers are evened up 2012-10-16 17:34:16 [Message] fib_1618 -> Chat: which also mean 2012-10-16 17:34:18 [Message] fib_1618 -> Chat: once again 2012-10-16 17:34:28 [Message] fib_1618 -> Chat: the bears still have no sponsors 2012-10-16 17:34:34 [Message] fib_1618 -> Chat: try as they may 2012-10-16 17:34:58 [Message] fib_1618 -> Chat: and this time taking Apple's decline as their point 2012-10-16 17:35:11 [Message] fib_1618 -> Chat: STILL they can't get enough traders to agree with them 2012-10-16 17:35:23 [Message] fib_1618 -> Chat: luckily though 2012-10-16 17:35:29 [Message] fib_1618 -> Chat: like we talked about last week 2012-10-16 17:35:36 [Message] fib_1618 -> Chat: we can also say the same about the bulls 2012-10-16 17:35:43 [Message] fib_1618 -> Chat: and if both sides are indecisive... 2012-10-16 17:35:46 [Message] fib_1618 -> Chat: we chop 2012-10-16 17:36:07 [Message] fib_1618 -> Chat: down 200 Dow points in 2-3 days 2012-10-16 17:36:18 [Message] fib_1618 -> Chat: and then up 200 Dow points in the same amount of time 2012-10-16 17:36:26 [Message] fib_1618 -> Chat: "tug of war" 2012-10-16 17:36:35 [Message] fib_1618 -> Chat: and now the flag between the two sides is neutral 2012-10-16 17:36:42 [Message] fib_1618 -> Chat: who will take charge? 2012-10-16 17:36:53 [Message] fib_1618 -> Chat: NYSE TRIN at .78 2012-10-16 17:37:00 [Message] fib_1618 -> Chat: Open 10 .97 2012-10-16 17:37:12 [Message] fib_1618 -> Chat: again.. 2012-10-16 17:37:16 [Message] fib_1618 -> Chat: if this is a tradable top 2012-10-16 17:37:24 [Message] fib_1618 -> Chat: we should see the Open 10's get close to .80 2012-10-16 17:37:36 [Message] fib_1618 -> Chat: so far...the plan is on point 2012-10-16 17:37:48 [Message] fib_1618 -> Chat: NASDAQ TRIN at .95 2012-10-16 17:37:56 [Message] fib_1618 -> Chat: Open 10 at 1.06 2012-10-16 17:38:10 [Message] fib_1618 -> Chat: and this might allow a larger advance to make up for the larger decline we saw last week 2012-10-16 17:38:31 [Message] fib_1618 -> Chat: and then wind up pretty much were the NYSE related indices are 2012-10-16 17:38:41 [Message] fib_1618 -> Chat: TM TRIN at 1.02 2012-10-16 17:38:49 [Message] fib_1618 -> Chat: Open 10 at 1.07 2012-10-16 17:38:56 [Message] fib_1618 -> Chat: so.... 2012-10-16 17:38:59 [Message] fib_1618 -> Chat: if anything 2012-10-16 17:39:06 [Message] fib_1618 -> Chat: the ball is in the bulls court for now 2012-10-16 17:39:28 [Message] fib_1618 -> Chat: any kind of early morning sell off is likely to be absorbed pretty quickly 2012-10-16 17:39:43 [Message] fib_1618 -> Chat: and we should see things stabilize during the day 2012-10-16 17:39:45 [Message] fib_1618 -> Chat: for the bulls 2012-10-16 17:40:14 [Message] fib_1618 -> Chat: they have the MID, and to a lesser degree the SML, showing signs that last weeks bottom might be more than just a bounce 2012-10-16 17:40:35 [Message] fib_1618 -> Chat: and hopefully we'll have a better handle on that before Thursday 2012-10-16 17:40:43 [Message] fib_1618 -> Chat: for now... 2012-10-16 17:40:53 [Message] fib_1618 -> Chat: if long...hold with trailing stops 2012-10-16 17:41:07 [Message] fib_1618 -> Chat: if short...it's going to be a tough go here 2012-10-16 17:41:36 [Message] fib_1618 -> Chat: and if you're in cash...you have the best seat in the house 2012-10-16 17:41:49 [Message] fib_1618 -> Chat: patience... 2012-10-16 17:41:55 [Message] fib_1618 -> Chat: anything else? 2012-10-16 17:42:28 [Message] fib_1618 -> Chat: another clue to watch for 2012-10-16 17:42:42 [Message] fib_1618 -> Chat: is how prices perform at .50 and .618 retracement levels 2012-10-16 17:42:53 [Message] fib_1618 -> Chat: watch the internals as prices reach these levels 2012-10-16 17:43:04 [Message] fib_1618 -> Chat: if they continue to improve, I would stand aside on shorts 2012-10-16 17:43:37 [Message] fib_1618 -> Chat: as there's too many things here that are suggesting that this may not be a tradable top 2012-10-16 17:44:00 [Message] fib_1618 -> Chat: allow the market to share its whispers and go with that 2012-10-16 17:44:40 [Message] fib_1618 -> Chat: OK..."enjoy" the debate 2012-10-16 17:44:53 [Message] fib_1618 -> Chat: and we'll see how things look on Wednesday at the usual time 2012-10-16 17:44:55 [Message] fib_1618 -> Chat: good night __________________ Dave's LinkedIn Profile Technical Watch Twitter Page Technical Watch Facebook Page "As for it being different this time, it is different every time. The question is in what way, and to what extent" - Tom McClellan "An economist is someone who sees something happen, and then wonders if it would work in theory" - Ronald Reagan "What we see depends mainly on what we look for" - John Lubbock "The eye sees only what the mind is ready to comprehend" - Henri Bergson “Answers are easy; it’s asking the right questions which is hard” - Dr. Who - 1977 "You know the very powerful and the very stupid have one thing in common - they don't alter their views to fit the facts, they alter the facts to fit their views (which can be uncomfortable if you happen to be one of the facts that needs altering)" - Dr. Who - 1977
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