All donations go towards web site maintenance for all of Technical Watch,
keep it free of charge, and may be tax deductable as an investment expense.

PayPal Verified
Join our market chat sessions every Tuesday and Thursday at 4:00 pm Pacific time!
More information on subscriber services can be found at

Sign up Calendar Latest Topics

Note: This topic is locked. No new replies will be accepted.

  Author   Comment  

Posts: 4,888
Reply with quote  #1 
2010-12-21 16:00:15 [Message] fib_1618 -> Chat: good day
2010-12-21 16:00:20 [Message] fib_1618 -> Chat: how is everyone?
2010-12-21 16:00:27 [Message] PriceWatcher -> Chat: Hello
2010-12-21 16:00:39 [Message] fib_1618 -> Chat: good evening...or is it good morning??
2010-12-21 16:00:51 [Message] PriceWatcher -> Chat: Not that late yet...
2010-12-21 16:00:59 [Message] fib_1618 -> Chat: 1?
2010-12-21 16:01:10 [Message] PriceWatcher -> Chat: Yes
2010-12-21 16:01:16 [Message] fib_1618 -> Chat: late enough!
2010-12-21 16:01:21 [Message] PriceWatcher -> Chat: Yes
2010-12-21 16:01:27 [Message] fib_1618 -> Chat: or...early enough
2010-12-21 16:01:34 [Message] PriceWatcher -> Chat:
2010-12-21 16:02:21 [Message] fib_1618 -> Chat: how was everyone's week?
2010-12-21 16:02:27 [Message] Tracca -> Chat: Hi Fib, I have to go out for about an hour and will be back, I will read what I missed.
2010-12-21 16:02:45 [Message] fib_1618 -> Chat: hey...I forgot to write you back...very sorry
2010-12-21 16:02:53 [Message] fib_1618 -> Chat: been overwhelmed with stuff since my return
2010-12-21 16:02:55 [Message] Tracca -> Chat: You were on vacation
2010-12-21 16:03:06 [Message] thespookyone -> Chat: how was the vacation?
2010-12-21 16:03:14 [Message] fib_1618 -> Chat: the quick answer is that the bond CEF's lead by about 4 months ahead of the NYAD
2010-12-21 16:03:29 [Message] fib_1618 -> Chat: so you're dealing with two different contexts
2010-12-21 16:03:36 [Message] fib_1618 -> Chat: the vacation was a good one
2010-12-21 16:03:41 [Message] fib_1618 -> Chat: thanks for asking
2010-12-21 16:03:55 [Message] thespookyone -> Chat: good to hear!
2010-12-21 16:03:57 [Message] fib_1618 -> Chat: not that I'm ready to come back to work, mind you
2010-12-21 16:04:08 [Message] fib_1618 -> Chat: we start taking inventory later this week
2010-12-21 16:04:11 [Message] fib_1618 -> Chat: fun, fun, fun
2010-12-21 16:04:23 [Message] thespookyone -> Chat: been there, done that, ouch
2010-12-21 16:04:30 [Message] fib_1618 -> Chat: any questions or comments before we get started??
2010-12-21 16:04:46 [Message] Tracca -> Chat: VIX is pretty low, need your comment
2010-12-21 16:05:01 [Message] fib_1618 -> Chat: bull markets are always made up of complacency
2010-12-21 16:05:10 [Message] fib_1618 -> Chat: it can go to single digits before this run is over
2010-12-21 16:05:27 [Message] fib_1618 -> Chat: what I do with the volatility indexes
2010-12-21 16:05:40 [Message] fib_1618 -> Chat: is I apply an 89 period Bollinger Band to the data
2010-12-21 16:05:58 [Message] fib_1618 -> Chat: which works very well for the intermediate term focus
2010-12-21 16:06:15 [Message] fib_1618 -> Chat: your 89 day period itself is your demarcation between which side has control
2010-12-21 16:06:31 [Message] fib_1618 -> Chat: and you will notice that when we hit one band or the other we tend to reverse
2010-12-21 16:06:48 [Message] Tracca -> Chat: excellent, thank you
2010-12-21 16:06:53 [Message] fib_1618 -> Chat: I would try not to focus too much on something that can mean something or nothing at all
2010-12-21 16:07:35 [Message] fib_1618 -> Chat: it's good to keep in mind that all the volatility indexes allow us to see is the "implied" volatility of the price of a put option
2010-12-21 16:07:45 [Message] fib_1618 -> Chat: or to put it another way
2010-12-21 16:07:56 [Message] fib_1618 -> Chat: it measures the amount of mark up on that product
2010-12-21 16:08:07 [Message] fib_1618 -> Chat: the more demand...the higher the mark up
2010-12-21 16:08:35 [Message] fib_1618 -> Chat: the VIX, VXO, and VXN are given just too much weight in many traders analysis
2010-12-21 16:08:56 [Message] fib_1618 -> Chat: you can do much better by just looking at the direction of the A/D line
2010-12-21 16:09:13 [Message] fib_1618 -> Chat: and knowing when it's over extended
2010-12-21 16:09:41 [Message] fib_1618 -> Chat: I look at this gauge of market activity maybe twice a month or when there's a big move in the indices
2010-12-21 16:11:22 [Message] fib_1618 -> Chat:'s a tool that is low on my totem pole...personal preference and all that
2010-12-21 16:11:28 [Message] PriceWatcher -> Chat: I think we got a new high in the NYSE Comp AD line today
2010-12-21 16:11:35 [Message] fib_1618 -> Chat: ah oh!
2010-12-21 16:11:42 [Message] fib_1618 -> Chat: what will the bears think now?!?!
2010-12-21 16:11:53 [Message] fib_1618 -> Chat: there goes their divergence slant
2010-12-21 16:11:57 [Message] fib_1618 -> Chat: too bad
2010-12-21 16:12:01 [Message] fib_1618 -> Chat: let me take a look
2010-12-21 16:12:37 [Message] PriceWatcher -> Chat: Higher by 47 only, however. But higher
2010-12-21 16:13:07 [Message] fib_1618 -> Chat: all time highs!
2010-12-21 16:13:22 [Message] fib_1618 -> Chat: was pretty much a given for about three weeks now
2010-12-21 16:13:31 [Message] fib_1618 -> Chat: given that the NYUD has been moving higher
2010-12-21 16:13:32 [Message] PriceWatcher -> Chat: Since November 5
2010-12-21 16:13:36 [Message] fib_1618 -> Chat: yes
2010-12-21 16:14:23 [Message] fib_1618 -> Chat:
2010-12-21 16:14:43 [Message] fib_1618 -> Chat: there has been absolutely nothing wrong with volume during the last 3 weeks
2010-12-21 16:14:44 [Message] fib_1618 -> Chat: nothing
2010-12-21 16:15:02 [Message] fib_1618 -> Chat: but I'm sure you've read and heard about how volume has been "non confirming"
2010-12-21 16:15:11 [Message] fib_1618 -> Chat: which is further from the truth
2010-12-21 16:15:31 [Message] fib_1618 -> Chat: it's very important to use proper context in this area of analysis
2010-12-21 16:15:42 [Message] PriceWatcher -> Chat: But NYUD is still below the April high
2010-12-21 16:15:46 [Message] thespookyone -> Chat: why are the MCO's not taking out those November levels, as price skies through them?
2010-12-21 16:16:05 [Message] fib_1618 -> Chat: and stay away from those who believe they know and understand volume and its relation to price pattern structures and geometric patterns
2010-12-21 16:16:09 [Message] fib_1618 -> Chat: it is Tonny
2010-12-21 16:16:12 [Message] fib_1618 -> Chat: but it's rising
2010-12-21 16:16:15 [Message] fib_1618 -> Chat: money is moving in
2010-12-21 16:16:20 [Message] PriceWatcher -> Chat: Yes
2010-12-21 16:16:30 [Message] fib_1618 -> Chat: one sec Lew
2010-12-21 16:16:49 [Message] fib_1618 -> Chat: it's important to understand how volume plurality plays a part in all this
2010-12-21 16:17:42 [Message] fib_1618 -> Chat: unlike breadth of market which measures the amount of total liquidity available for investment (the A/D line)
2010-12-21 16:18:21 [Message] fib_1618 -> Chat: the volume line (NYUD for example) measures the amplitude and direction of this same liquidity factor
2010-12-21 16:18:31 [Message] fib_1618 -> Chat: a prefect technical world
2010-12-21 16:18:50 [Message] fib_1618 -> Chat: we would like to see both the A/D and U/D lines moving in not only the same direction
2010-12-21 16:19:15 [Message] fib_1618 -> Chat: but we would like to see volume plurality either keeping up with breadth or leading it
2010-12-21 16:19:23 [Message] thespookyone -> Chat: looks like price leading breadth on the MCO's, why isn't it?
2010-12-21 16:19:38 [Message] fib_1618 -> Chat: your volume quotient on moves when the bigger cap stocks are being bought and sold
2010-12-21 16:19:53 [Message] fib_1618 -> Chat: more like volume is now catching up with breadth
2010-12-21 16:19:58 [Message] fib_1618 -> Chat: to finish the thought
2010-12-21 16:20:28 [Message] fib_1618 -> Chat: breadth of market instructs us how many boats can rise in the total ocean
2010-12-21 16:20:49 [Message] fib_1618 -> Chat: while volume of market instructs us which boats are being focused on
2010-12-21 16:20:51 [Message] fib_1618 -> Chat: for example
2010-12-21 16:21:23 [Message] fib_1618 -> Chat: breadth of market has been leading which means that even the small caps will be able to draw from this amount of liquidity
2010-12-21 16:21:28 [Message] fib_1618 -> Chat: which includes the secondaries
2010-12-21 16:21:48 [Message] fib_1618 -> Chat: this is why the SML breadth MCSUM is already at higher highs
2010-12-21 16:22:06 [Message] fib_1618 -> Chat: money is so liquid that it can spread out to those less deserving
2010-12-21 16:22:33 [Message] fib_1618 -> Chat: volume, on the other hand, not only can move into these stocks
2010-12-21 16:22:48 [Message] fib_1618 -> Chat: but eventually once these secondary issues are saturated
2010-12-21 16:23:05 [Message] fib_1618 -> Chat: it can then move to those higher cap issues that provide more in the way of value
2010-12-21 16:23:15 [Message] fib_1618 -> Chat: this is when volume plurality starts to take off
2010-12-21 16:23:18 [Message] fib_1618 -> Chat: so...
2010-12-21 16:24:11 [Message] fib_1618 -> Chat: if we have a rising A/D line, but a flat to slightly rising U/D line, this says that money is available for investment but its not being utilized to the fullest extent
2010-12-21 16:24:43 [Message] fib_1618 -> Chat: if the U/D line is rising, but the A/D line is declining - this says that this liquidity quotient is drying up
2010-12-21 16:25:14 [Message] fib_1618 -> Chat: and with that the secondaries...then the SML...then the MID will start to lose participation of whatever funds are left for investment
2010-12-21 16:25:30 [Message] fib_1618 -> Chat: and since we start moving more into the high caps during this phase
2010-12-21 16:25:44 [Message] fib_1618 -> Chat: as the A/D line continues to decline
2010-12-21 16:26:13 [Message] fib_1618 -> Chat: there will be less and less stocks that will find the volume needed to keep them from falling back on the bear market default
2010-12-21 16:26:39 [Message] fib_1618 -> Chat: and then prices, overall, begin to follow the direction of the A/D line itself
2010-12-21 16:26:55 [Message] fib_1618 -> Chat: a great example of this would be the 1998-2002 bear market
2010-12-21 16:27:22 [Message] fib_1618 -> Chat: where the NYAD line topped out in April of 1998 and bottomed in 2000
2010-12-21 16:27:39 [Message] fib_1618 -> Chat: during this time the broader market suffered
2010-12-21 16:27:49 [Message] fib_1618 -> Chat: but the large caps continued to rally
2010-12-21 16:28:07 [Message] fib_1618 -> Chat: again...we have to remember that the major indexes are weighted
2010-12-21 16:28:39 [Message] fib_1618 -> Chat: enough IBM or GE in the Dow or OEX, and it really doesn't matter what happens to the rest in the index itself
2010-12-21 16:28:56 [Message] fib_1618 -> Chat: it becomes a stealth rally
2010-12-21 16:29:28 [Message] fib_1618 -> Chat: so to tie this altogether
2010-12-21 16:29:40 [Message] PriceWatcher -> Chat: So would you say that a MCO divergence on the NYUD is better that a MCO divergence on the NYAD for trading the index?
2010-12-21 16:29:48 [Message] fib_1618 -> Chat: the NYUD line will top out pretty much at the same time as that of prices themselves
2010-12-21 16:30:10 [Message] fib_1618 -> Chat: have to look...haven't had time as yet to study anything
2010-12-21 16:30:23 [Message] fib_1618 -> Chat: and with that...let me get DP up and we'll get started
2010-12-21 16:31:01 [Message] fib_1618 -> Chat: we go
2010-12-21 16:31:18 [Message] fib_1618 -> Chat: after snapping back to its zero line last week
2010-12-21 16:31:26 [Message] fib_1618 -> Chat: the CO NYSE breadth MCO moved to higher highs today
2010-12-21 16:31:37 [Message] fib_1618 -> Chat: confirming the higher price highs in the NYA
2010-12-21 16:31:51 [Message] fib_1618 -> Chat: this would then suggest that we have another leg up starting today
2010-12-21 16:32:21 [Message] fib_1618 -> Chat: bottoms above bottoms continue to control the MCO pattern
2010-12-21 16:32:21 [Message] thespookyone -> Chat: higher than nov highs?
2010-12-21 16:32:27 [Message] fib_1618 -> Chat: it looks like it
2010-12-21 16:32:31 [Message] fib_1618 -> Chat: perceptively
2010-12-21 16:32:38 [Message] fib_1618 -> Chat: but I'm going to give it the nod
2010-12-21 16:32:46 [Message] fib_1618 -> Chat: only because that the NYAD went to new highs today
2010-12-21 16:33:07 [Message] fib_1618 -> Chat: and usually we will need to take out a prior resistance point on the short term trend to do this
2010-12-21 16:33:18 [Message] fib_1618 -> Chat: so I maybe taking a bit of a liberty here
2010-12-21 16:33:23 [Message] fib_1618 -> Chat: let's go to the composite
2010-12-21 16:33:43 [Message] fib_1618 -> Chat: and there it's definitely higher
2010-12-21 16:33:51 [Message] fib_1618 -> Chat: which is also good news
2010-12-21 16:34:06 [Message] fib_1618 -> Chat: in that the interest rate sensitives are helping the commons along
2010-12-21 16:34:09 [Message] fib_1618 -> Chat: which means
2010-12-21 16:34:21 [Message] thespookyone -> Chat: hcomposite is which?
2010-12-21 16:34:33 [Message] fib_1618 -> Chat: that the entire NYSE marketplace is back into gear to the upside for the first time in over a month
2010-12-21 16:34:45 [Message] fib_1618 -> Chat: sorry?
2010-12-21 16:34:51 [Message] fib_1618 -> Chat: hcomposite?
2010-12-21 16:34:58 [Message] thespookyone -> Chat: is composite traditional, or?
2010-12-21 16:35:04 [Message] fib_1618 -> Chat: no RA
2010-12-21 16:35:08 [Message] fib_1618 -> Chat: I like the RA
2010-12-21 16:35:14 [Message] thespookyone -> Chat: thx
2010-12-21 16:35:23 [Message] fib_1618 -> Chat: the composite is ALL the traded stocks on the NYSE
2010-12-21 16:35:30 [Message] fib_1618 -> Chat: as opposed to the CO's only
2010-12-21 16:35:54 [Message] thespookyone -> Chat: the RA didn't take out Nov, not close
2010-12-21 16:35:57 [Message] fib_1618 -> Chat: the CO takes out all of the pollution that everyone seems to discount
2010-12-21 16:36:18 [Message] fib_1618 -> Chat: sorry...I'm only talking about the December highs
2010-12-21 16:36:30 [Message] fib_1618 -> Chat: the importance here is
2010-12-21 16:36:43 [Message] thespookyone -> Chat: I thought we should be taking outrt NOV
2010-12-21 16:36:47 [Message] fib_1618 -> Chat: is that we moved to "oversold" after the November peak
2010-12-21 16:36:52 [Message] fib_1618 -> Chat: moved up above the zero line
2010-12-21 16:36:59 [Message] fib_1618 -> Chat: snapped back to the zero line...found support
2010-12-21 16:37:04 [Message] fib_1618 -> Chat: and have now moved higher
2010-12-21 16:37:16 [Message] fib_1618 -> Chat: this tells us that a new sequence is now underway
2010-12-21 16:37:27 [Message] fib_1618 -> Chat: the November highs are not as important to the structure of the MCO as they once were
2010-12-21 16:37:40 [Message] fib_1618 -> Chat: are correct on the November peak
2010-12-21 16:37:49 [Message] fib_1618 -> Chat: but now that we have good technical structure
2010-12-21 16:38:03 [Message] fib_1618 -> Chat: and that we're able to break out to new highs on the raw data
2010-12-21 16:38:18 [Message] fib_1618 -> Chat: it's a pretty good bet now that the November highs will be eclipsed in the next week or so
2010-12-21 16:38:26 [Message] fib_1618 -> Chat: in other words
2010-12-21 16:38:37 [Message] fib_1618 -> Chat: the bulls seem to be getting off their indecision
2010-12-21 16:38:49 [Message] fib_1618 -> Chat: and looking at the NYSE breadth MCSUM
2010-12-21 16:38:57 [Message] fib_1618 -> Chat: the bears have absolutely no power at all
2010-12-21 16:38:59 [Message] fib_1618 -> Chat: nothing
2010-12-21 16:39:03 [Message] fib_1618 -> Chat: they are drained...exhausted
2010-12-21 16:39:18 [Message] fib_1618 -> Chat: so the path of "least resistance" is now higher again
2010-12-21 16:39:55 [Message] fib_1618 -> Chat: confirmation on this will come when the NYSE breadth MCSUM takes out its highs of the last 3 weeks which can happen as soon as tomorrow
2010-12-21 16:40:01 [Message] fib_1618 -> Chat: again...the market is so saturated right now
2010-12-21 16:40:38 [Message] fib_1618 -> Chat: that there's very little way for the bears to move the market without money finding points of what is perceived as fair value
2010-12-21 16:41:05 [Message] fib_1618 -> Chat: what we've been seeing in the bond CEF's is that this liquidity quotient is now starting to dry up
2010-12-21 16:41:19 [Message] fib_1618 -> Chat: but it's going to take several months before its felt in the A/D line
2010-12-21 16:41:26 [Message] fib_1618 -> Chat: for now
2010-12-21 16:41:38 [Message] fib_1618 -> Chat: money is moving out of debt and into equities
2010-12-21 16:41:49 [Message] fib_1618 -> Chat: just like it should in proper asset class rotation
2010-12-21 16:42:01 [Message] fib_1618 -> Chat: near term
2010-12-21 16:42:08 [Message] fib_1618 -> Chat: bonds should rally into the end of the year
2010-12-21 16:42:19 [Message] fib_1618 -> Chat: that class was very "oversold"
2010-12-21 16:42:30 [Message] fib_1618 -> Chat: ridiculously so in several areas
2010-12-21 16:42:41 [Message] fib_1618 -> Chat: news wise
2010-12-21 16:42:50 [Message] fib_1618 -> Chat: current tax rates have been extended
2010-12-21 16:42:56 [Message] fib_1618 -> Chat: so no need to sell
2010-12-21 16:43:15 [Message] fib_1618 -> Chat: we are in the 3rd year of the Presidential cycle
2010-12-21 16:43:46 [Message] fib_1618 -> Chat: which, except the 1930's, has always been the strongest year for stocks
2010-12-21 16:44:20 [Message] fib_1618 -> Chat: the only question near term is how over extended are we?
2010-12-21 16:44:36 [Message] fib_1618 -> Chat: going back to before I left
2010-12-21 16:45:10 [Message] fib_1618 -> Chat: I remember that the Open TRIN numbers should better reflect what's going on now that the Citibank anomaly is past
2010-12-21 16:45:20 [Message] fib_1618 -> Chat: so let's go on and see what else we have
2010-12-21 16:45:48 [Message] fib_1618 -> Chat: the NASDAQ breadth MCO has the same pattern as that of the NYSE breadth MCO
2010-12-21 16:45:56 [Message] fib_1618 -> Chat: but hasn't as yet moved to above the December highs
2010-12-21 16:46:10 [Message] fib_1618 -> Chat: meanwhile
2010-12-21 16:46:34 [Message] fib_1618 -> Chat: the NASDAQ composite index is close, if not already, at its highest levels since 2001
2010-12-21 16:46:36 [Message] fib_1618 -> Chat: let me check
2010-12-21 16:47:38 [Message] fib_1618 -> Chat: in 2007 it topped out at 2859
2010-12-21 16:47:52 [Message] fib_1618 -> Chat: so we're about 200 points away
2010-12-21 16:48:25 [Message] fib_1618 -> Chat: but here is a great example of how liquidity levels can drive a chart
2010-12-21 16:48:45 [Message] fib_1618 -> Chat: with these stocks generally the ones in which tend to go out of business
2010-12-21 16:49:14 [Message] fib_1618 -> Chat: for money to be flowing into these risky issues tells us that there is more than ample amounts of money to go around
2010-12-21 16:49:16 [Message] fib_1618 -> Chat: AND
2010-12-21 16:49:21 [Message] fib_1618 -> Chat: to take these kinds of risks
2010-12-21 16:49:33 [Message] fib_1618 -> Chat: now...
2010-12-21 16:49:41 [Message] fib_1618 -> Chat: we have all heard it before
2010-12-21 16:50:01 [Message] fib_1618 -> Chat: on how any market rally in the NYSE issues are always suspect without the NASDAQ
2010-12-21 16:50:11 [Message] fib_1618 -> Chat: well...if that's true...then why worry?
2010-12-21 16:50:24 [Message] fib_1618 -> Chat: the bears are in real trouble here
2010-12-21 16:50:35 [Message] fib_1618 -> Chat: they are beaten and bruised
2010-12-21 16:50:39 [Message] fib_1618 -> Chat: and can get nothing going
2010-12-21 16:50:58 [Message] fib_1618 -> Chat: there's just too much money out there to soften any kind of blows directed at the bulls
2010-12-21 16:51:14 [Message] fib_1618 -> Chat: when that will the direction of prices
2010-12-21 16:51:41 [Message] fib_1618 -> Chat: another important point I want to share here is
2010-12-21 16:51:47 [Message] fib_1618 -> Chat: since we're dealing with oscillators
2010-12-21 16:52:18 [Message] fib_1618 -> Chat: these kind of tools only work their best magic when prices are consolidating
2010-12-21 16:52:37 [Message] fib_1618 -> Chat: when prices are trending, as they are now on the NASDAQ, the MCO takes a backseat to the the MCSUM given that the MCSUM encompasses a larger time value
2010-12-21 16:53:17 [Message] fib_1618 -> Chat: so if we look at the NASDAQ breadth MCSUM
2010-12-21 16:53:27 [Message] fib_1618 -> Chat: or...if we look at the NDX breadth MCSUM
2010-12-21 16:53:57 [Message] fib_1618 -> Chat: we see that the NASDAQ breadth MCSUM has been rising confirming the DIRECTION of price
2010-12-21 16:54:20 [Message] fib_1618 -> Chat: while the NDX breadth MCSUM is only now following the troops in this leadership direction
2010-12-21 16:54:35 [Message] fib_1618 -> Chat: this is another relationship in which we have talked about in that we always want to see the greatest amount of participation to reaffirm the strength of a move
2010-12-21 16:55:32 [Message] fib_1618 -> Chat: and here again...with the relationship of the COMPX and the NDX we have this bullish configuration
2010-12-21 16:55:42 [Message] fib_1618 -> Chat: until that changes
2010-12-21 16:55:55 [Message] fib_1618 -> Chat: we just have to follow it...or be left behind
2010-12-21 16:56:20 [Message] fib_1618 -> Chat: I seem to remember that we were getting indications before I left that the train had already left Las Vegas to New York
2010-12-21 16:56:35 [Message] fib_1618 -> Chat: so far...I see nothing at all different to change that idea
2010-12-21 16:56:41 [Message] fib_1618 -> Chat: in fact
2010-12-21 16:56:52 [Message] fib_1618 -> Chat: we're probably going over the Rockies now
2010-12-21 16:57:20 [Message] fib_1618 -> Chat: higher highs in the SPX breadth MCO
2010-12-21 16:57:38 [Message] fib_1618 -> Chat: and this translates to a large gap higher on the SPX breadth MCSUM
2010-12-21 16:57:50 [Message] fib_1618 -> Chat: so...maybe we have a Santa rally on our hands
2010-12-21 16:57:55 [Message] fib_1618 -> Chat: another thing to think about is that
2010-12-21 16:58:17 [Message] fib_1618 -> Chat: we were pretty much choppy with a bullish bias in the weeks leading up to last Friday's expiration period
2010-12-21 16:58:58 [Message] fib_1618 -> Chat: usually when this happens, we tend to pull back for about 1 or 2 weeks given the amount of stock that was accumulated by the expiration of options, options on futures, and futures
2010-12-21 16:59:02 [Message] fib_1618 -> Chat: we haven't had that
2010-12-21 16:59:14 [Message] fib_1618 -> Chat: and now we're staring to move to higher highs
2010-12-21 16:59:31 [Message] fib_1618 -> Chat: I don't think it would be wise to ignore this kind of strength
2010-12-21 16:59:53 [Message] fib_1618 -> Chat: this is why the last few weeks have been hit and run
2010-12-21 17:00:13 [Message] fib_1618 -> Chat: now that we're starting to trend again...hit and run becomes old news
2010-12-21 17:00:27 [Message] fib_1618 -> Chat: and a different tactic should be employed
2010-12-21 17:00:32 [Message] fib_1618 -> Chat: for example
2010-12-21 17:00:41 [Message] fib_1618 -> Chat: if your work generates upside price objectives
2010-12-21 17:01:08 [Message] fib_1618 -> Chat: you keep your positions open until you either reach those objectives - OR - you start to see a loss of momentum
2010-12-21 17:01:24 [Message] fib_1618 -> Chat: this would mean one can hold a position for several days
2010-12-21 17:01:41 [Message] fib_1618 -> Chat: again...we're only trying to ride the directional wave of money flow
2010-12-21 17:01:59 [Message] fib_1618 -> Chat: with those indices that haven't as yet seen new highs in their MCSUM's
2010-12-21 17:02:09 [Message] fib_1618 -> Chat: you can play your trades closer
2010-12-21 17:02:20 [Message] fib_1618 -> Chat: but once we move to new highs (if we do)
2010-12-21 17:02:27 [Message] fib_1618 -> Chat: then you can kind of sit back and watch
2010-12-21 17:02:31 [Message] fib_1618 -> Chat: in bull moves
2010-12-21 17:02:38 [Message] fib_1618 -> Chat: we generally open lower and then rally through the day
2010-12-21 17:02:47 [Message] fib_1618 -> Chat: if you see this kind of personality
2010-12-21 17:03:01 [Message] fib_1618 -> Chat: then you have a pretty good notion that you're right "on the money"
2010-12-21 17:03:29 [Message] fib_1618 -> Chat: now...I know what you're probably thinking
2010-12-21 17:03:35 [Message] fib_1618 -> Chat: we are making higher price highs
2010-12-21 17:03:55 [Message] fib_1618 -> Chat: but many of the MCSUM's are still below their November highs
2010-12-21 17:04:00 [Message] fib_1618 -> Chat: this is true
2010-12-21 17:04:25 [Message] fib_1618 -> Chat: but for now we are looking, first and foremost, for a positive MCO structure to continue
2010-12-21 17:04:29 [Message] fib_1618 -> Chat: and that would mean bottoms above bottoms - breakouts and tests that are successful....this kind of thing
2010-12-21 17:04:51 [Message] fib_1618 -> Chat: but secondary
2010-12-21 17:05:09 [Message] fib_1618 -> Chat: we need to make sure that the DIRECTION of the MCSUM is in keeping with the direction of prices
2010-12-21 17:05:23 [Message] fib_1618 -> Chat: as long as this is occurring...we are said to be trending
2010-12-21 17:05:41 [Message] fib_1618 -> Chat: divergences are only a potential UNTIL they are triggered
2010-12-21 17:05:56 [Message] fib_1618 -> Chat: many traders freeze up when they see divergences like what we're talking about
2010-12-21 17:06:08 [Message] fib_1618 -> Chat: and they will lose a lot of what the price trend will deliver
2010-12-21 17:06:19 [Message] fib_1618 -> Chat: the key here is confirmation of direction
2010-12-21 17:06:32 [Message] fib_1618 -> Chat: because we all know that after the first extreme in any oscillator
2010-12-21 17:06:56 [Message] fib_1618 -> Chat: every peak after that is more than likely going to be not as robust as the first
2010-12-21 17:07:00 [Message] fib_1618 -> Chat: Space Shuttle...
2010-12-21 17:07:13 [Message] fib_1618 -> Chat: we have the greatest amount of thrust when it launches
2010-12-21 17:07:33 [Message] fib_1618 -> Chat: but doesn't need as much energy to continue to move up and on course
2010-12-21 17:07:44 [Message] fib_1618 -> Chat: nervous...?
2010-12-21 17:07:49 [Message] fib_1618 -> Chat: that's what stops are for
2010-12-21 17:08:01 [Message] fib_1618 -> Chat: but remember the importance on the level in which the MCSUM is
2010-12-21 17:08:04 [Message] fib_1618 -> Chat: the higher (or lower) it is
2010-12-21 17:08:22 [Message] fib_1618 -> Chat: the more difficult it is for the opposite side to take control and to develop a trend
2010-12-21 17:08:38 [Message] fib_1618 -> Chat: take the November highs for example
2010-12-21 17:09:09 [Message] fib_1618 -> Chat: how many times did we talk about that even though the MCSUM might move lower that doesn't necessarily mean that prices won't move to higher highs before we'll see a top????
2010-12-21 17:09:15 [Message] fib_1618 -> Chat: 10 times?
2010-12-21 17:09:30 [Message] fib_1618 -> Chat: every session for a while we talked about this
2010-12-21 17:09:42 [Message] fib_1618 -> Chat: and here you have your proof
2010-12-21 17:09:54 [Message] fib_1618 -> Chat: so the lesson here is that although the direction of the MCSUM can change
2010-12-21 17:10:32 [Message] fib_1618 -> Chat: it doesn't mean that prices won't carry on based on the momentum of the energy already generated
2010-12-21 17:10:38 [Message] fib_1618 -> Chat: before I left on my trip I made quick post at TT
2010-12-21 17:11:02 [Message] fib_1618 -> Chat: and it was specifically pointed to some pretty good traders there
2010-12-21 17:11:20 [Message] fib_1618 -> Chat: and I said...not to under estimate the underlying power of this marketplace
2010-12-21 17:11:50 [Message] fib_1618 -> Chat: it's very dangerous to "fade" a marketplace when there is so much strength driving it
2010-12-21 17:12:13 [Message] fib_1618 -> Chat: and historic levels to boot
2010-12-21 17:12:19 [Message] fib_1618 -> Chat: what this means is
2010-12-21 17:12:35 [Message] fib_1618 -> Chat: what we think might be a tried and true indications of an impending top
2010-12-21 17:13:05 [Message] fib_1618 -> Chat: might not work or will need to be "adjusted" to fit the current technical condition of the market
2010-12-21 17:13:08 [Message] fib_1618 -> Chat: for example
2010-12-21 17:13:22 [Message] fib_1618 -> Chat: if we look at the Open 10
2010-12-21 17:13:40 [Message] fib_1618 -> Chat: we have a long track record of when it gets below .80
2010-12-21 17:14:01 [Message] fib_1618 -> Chat: it's a fairly good bet that some sort of corrective activity is needed before moving forward
2010-12-21 17:14:14 [Message] fib_1618 -> Chat: with the highest liquidity levels in history right now
2010-12-21 17:14:27 [Message] fib_1618 -> Chat: maybe .80 is too low...maybe we need a reading of .70
2010-12-21 17:15:18 [Message] fib_1618 -> Chat: or it could be an indication that the market is strong enough to where it can be "overbought", and given the support beneath, get even more "overbought" as it gets overwhelmed by this same capital
2010-12-21 17:15:25 [Message] fib_1618 -> Chat: think of it
2010-12-21 17:15:42 [Message] fib_1618 -> Chat: corporate money chests are at all time highs
2010-12-21 17:16:05 [Message] fib_1618 -> Chat: with "safety" making only 3% or less
2010-12-21 17:16:16 [Message] fib_1618 -> Chat: and stocks giving a return much better than that
2010-12-21 17:16:27 [Message] fib_1618 -> Chat: where do you think a money manger is going to put his "performance" money?
2010-12-21 17:16:44 [Message] fib_1618 -> Chat: after all...they get reviewed too
2010-12-21 17:17:04 [Message] fib_1618 -> Chat: and how they're doing compared to others is always a consideration
2010-12-21 17:17:17 [Message] fib_1618 -> Chat: anyway...let's move on
2010-12-21 17:17:46 [Message] fib_1618 -> Chat: let's jump to the SML data
2010-12-21 17:18:12 [Message] fib_1618 -> Chat: how can any technician be bearish here with the kind of strength we're seeing in the SML breadth MCSUM?
2010-12-21 17:18:57 [Message] fib_1618 -> Chat: the index itself is now up close to 25% in 4 months
2010-12-21 17:19:10 [Message] fib_1618 -> Chat: that's 100% annually
2010-12-21 17:19:37 [Message] fib_1618 -> Chat: you think a money manager can keep out of this market when he's only been making 3% a year?
2010-12-21 17:19:53 [Message] fib_1618 -> Chat: wouldn't be reasonable..would it?
2010-12-21 17:20:21 [Message] fib_1618 -> Chat: and then I'll ask the question again that I've been asking for over a month now
2010-12-21 17:20:50 [Message] fib_1618 -> Chat: has there been a price top in the equities with the SML and/or MID/NASDAQ leading the charge higher?
2010-12-21 17:21:00 [Message] fib_1618 -> Chat: not that I can think of
2010-12-21 17:21:03 [Message] fib_1618 -> Chat: however
2010-12-21 17:21:10 [Message] fib_1618 -> Chat: back in the late 1960's
2010-12-21 17:21:22 [Message] fib_1618 -> Chat: the Value Line Index did move to higher highs than that of the Dow
2010-12-21 17:21:26 [Message] fib_1618 -> Chat: so it can happen
2010-12-21 17:21:47 [Message] PriceWatcher -> Chat: value line index?
2010-12-21 17:21:59 [Message] fib_1618 -> Chat: but would it be reasonable to expect given that the A/D lines of just about every angle is close to or at new highs?
2010-12-21 17:22:13 [Message] fib_1618 -> Chat: over the last 3 weeks have you noticed that although breadth of market has been soft
2010-12-21 17:22:37 [Message] fib_1618 -> Chat: the U/D lines in the cumulative charts were moving higher?
2010-12-21 17:22:46 [Message] fib_1618 -> Chat: money moves in ADVANCE of news
2010-12-21 17:23:12 [Message] fib_1618 -> Chat: it would also occur to me that it moves into larger issues when nobody is really caring about these same issues
2010-12-21 17:23:47 [Message] fib_1618 -> Chat: could make more a bullish case than that of a bearish one with this area of analysis
2010-12-21 17:24:11 [Message] fib_1618 -> Chat: staying with the SML breadth MCSUM
2010-12-21 17:24:28 [Message] fib_1618 -> Chat: you'll also notice that although prices are streaking higher
2010-12-21 17:24:44 [Message] fib_1618 -> Chat: the MCSUM is diverging with the peak seen in April
2010-12-21 17:25:24 [Message] fib_1618 -> Chat: so here's another good example where direction is more important than divergence techniques when we're trying to ascertain probability to outcome
2010-12-21 17:25:51 [Message] fib_1618 -> Chat: on the cumulative charts this past weekend
2010-12-21 17:26:31 [Message] fib_1618 -> Chat: you probably noticed that I took away the "ledge" idea from the NYSE breadth MCSUM and changed it to that of a "compression...big move coming"
2010-12-21 17:26:43 [Message] fib_1618 -> Chat: this unwinding process may have started today
2010-12-21 17:27:31 [Message] fib_1618 -> Chat: and since we've been moving net sideways for what may have been "never so long before in history"
2010-12-21 17:27:47 [Message] fib_1618 -> Chat: I would look for something quite explosive to come out of this compression point
2010-12-21 17:28:11 [Message] fib_1618 -> Chat: so if we really show a lot of vigor tomorrow
2010-12-21 17:28:52 [Message] fib_1618 -> Chat: I would respect this for what it may imply
2010-12-21 17:31:27 [Message] fib_1618 -> Chat: the Value Line Index was used as the broadest measure of stock market activity
2010-12-21 17:31:49 [Message] fib_1618 -> Chat: I say was as there wasn't too much out there until around 1965 when the NYA was introduced
2010-12-21 17:32:04 [Message] fib_1618 -> Chat: with the NASDAQ composite introduced in 1972
2010-12-21 17:32:25 [Message] fib_1618 -> Chat: so there was the Value Line, the SPX, and the Dow
2010-12-21 17:32:57 [Message] fib_1618 -> Chat: anyway...concentrate on the MCSUM for now
2010-12-21 17:33:11 [Message] fib_1618 -> Chat: and watch the 21 day window on the DP pages for a better handle on things
2010-12-21 17:33:31 [Message] fib_1618 -> Chat: as long as the upside gaps continue...this is the easier direction to make money
2010-12-21 17:33:59 [Message] fib_1618 -> Chat: when the gaps start to close or congest, then you know that money is starting to hold back
2010-12-21 17:34:13 [Message] fib_1618 -> Chat: when it changes direction...then you can look for shorts and such
2010-12-21 17:34:14 [Message] fib_1618 -> Chat: now..
2010-12-21 17:34:28 [Message] fib_1618 -> Chat: there will be those that NEED to play both sides at all times
2010-12-21 17:34:49 [Message] fib_1618 -> Chat: but your easier trades for the time being will be with the flow of this case...long
2010-12-21 17:35:41 [Message] fib_1618 -> Chat: looking quickly at the sector breadth charts
2010-12-21 17:35:52 [Message] fib_1618 -> Chat: and I would pay special attention now to the XLF
2010-12-21 17:36:02 [Message] fib_1618 -> Chat: it looks like it's ready to go
2010-12-21 17:36:09 [Message] fib_1618 -> Chat: breakouts
2010-12-21 17:36:11 [Message] fib_1618 -> Chat: snapbacks
2010-12-21 17:36:13 [Message] fib_1618 -> Chat: supports
2010-12-21 17:36:19 [Message] fib_1618 -> Chat: great structure now
2010-12-21 17:36:56 [Message] fib_1618 -> Chat: and we should see a simultaneous breakout above the November/December highs near term
2010-12-21 17:37:07 [Message] fib_1618 -> Chat: (November MCSUM and December prices)
2010-12-21 17:37:22 [Message] fib_1618 -> Chat: I like C here as one idea but you should look around...use the DP PMO charts
2010-12-21 17:37:43 [Message] fib_1618 -> Chat: this market is friendly
2010-12-21 17:38:20 [Message] fib_1618 -> Chat: materials (XLB) are also strong
2010-12-21 17:38:25 [Message] fib_1618 -> Chat: which means housing stocks are primed
2010-12-21 17:38:40 [Message] fib_1618 -> Chat: more thing
2010-12-21 17:38:53 [Message] fib_1618 -> Chat: with the exception of the XLF and XLV
2010-12-21 17:39:01 [Message] fib_1618 -> Chat: all of the other sectors are above their April price highs
2010-12-21 17:39:09 [Message] fib_1618 -> Chat: when you move to higher highs like this
2010-12-21 17:39:19 [Message] fib_1618 -> Chat: who's there to sell?
2010-12-21 17:39:44 [Message] fib_1618 -> Chat: on to the volume McClellan's
2010-12-21 17:40:14 [Message] fib_1618 -> Chat: the CO volume MCSUM is now testing its overhead resistance at the +750 level
2010-12-21 17:40:33 [Message] fib_1618 -> Chat: and composite NYSE volume MCSUM is at new highs now
2010-12-21 17:40:47 [Message] fib_1618 -> Chat: nothing bearish about that
2010-12-21 17:41:15 [Message] fib_1618 -> Chat: there's a lack of enthusiasm with the NASDAQ volume MCSUM
2010-12-21 17:41:32 [Message] fib_1618 -> Chat: but it's also at the +750 level which allows the price pattern to easily move to higher highs
2010-12-21 17:41:57 [Message] fib_1618 -> Chat: look at how the NDX volume MCSUM is hugging support at the +500 level
2010-12-21 17:42:06 [Message] fib_1618 -> Chat: as if it's acting as a zero line
2010-12-21 17:42:12 [Message] fib_1618 -> Chat: very bullish behavior
2010-12-21 17:42:44 [Message] fib_1618 -> Chat: Dow volume MCSUM is now back up to its zero line
2010-12-21 17:42:57 [Message] fib_1618 -> Chat: so we could see some softness here near term
2010-12-21 17:43:10 [Message] fib_1618 -> Chat: but as we've seen with the breadth side
2010-12-21 17:43:16 [Message] fib_1618 -> Chat: it's not the Dow that's leading here
2010-12-21 17:43:25 [Message] fib_1618 -> Chat: it's the broader market
2010-12-21 17:43:37 [Message] fib_1618 -> Chat: so although we "might" see a near term pullback in the Dow
2010-12-21 17:43:55 [Message] fib_1618 -> Chat: the small caps shouldn't see much
2010-12-21 17:44:04 [Message] fib_1618 -> Chat: look at yesterday and today
2010-12-21 17:44:23 [Message] fib_1618 -> Chat: the generals were having their problems moving higher
2010-12-21 17:44:31 [Message] fib_1618 -> Chat: but the small caps had no problems at all
2010-12-21 17:45:00 [Message] fib_1618 -> Chat: just looking at these one year charts of the current uptrend and you have to say it's quite impressive
2010-12-21 17:45:07 [Message] fib_1618 -> Chat: with absolutely no indication of tiring
2010-12-21 17:45:19 [Message] fib_1618 -> Chat: and look at all the top pickers of late!
2010-12-21 17:45:27 [Message] fib_1618 -> Chat: they call it a probe
2010-12-21 17:45:37 [Message] fib_1618 -> Chat: it's all emotional
2010-12-21 17:46:10 [Message] fib_1618 -> Chat: lol - look at the XLF volume MCSUM!
2010-12-21 17:46:29 [Message] fib_1618 -> Chat: I guess it wasn't corrected
2010-12-21 17:46:33 [Message] fib_1618 -> Chat: oh well
2010-12-21 17:46:48 [Message] fib_1618 -> Chat: here is a good example of direction being important
2010-12-21 17:47:25 [Message] fib_1618 -> Chat: materials continue to be exceptionally strong
2010-12-21 17:47:29 [Message] fib_1618 -> Chat: as is the energy sector
2010-12-21 17:47:50 [Message] fib_1618 -> Chat: I'm sure that some of you are very happy when you sold your shorts back in September
2010-12-21 17:48:08 [Message] PriceWatcher -> Chat: Sure
2010-12-21 17:48:29 [Message] fib_1618 -> Chat: and the only thing that told you to cover was....?
2010-12-21 17:48:52 [Message] PriceWatcher -> Chat: MCO break out I think
2010-12-21 17:48:57 [Message] fib_1618 -> Chat: yep
2010-12-21 17:49:03 [Message] fib_1618 -> Chat: and the MCSUM breaking to new highs as well
2010-12-21 17:49:13 [Message] fib_1618 -> Chat: and since that time
2010-12-21 17:49:36 [Message] fib_1618 -> Chat: the XLE is up 18%
2010-12-21 17:50:16 [Message] fib_1618 -> Chat: so much for the talking heads in this business who were screaming to sell because the economy was going to double dip
2010-12-21 17:50:37 [Message] fib_1618 -> Chat: this is why we need to keep focused on the direction of money
2010-12-21 17:50:49 [Message] fib_1618 -> Chat: everything else means very little
2010-12-21 17:51:19 [Message] fib_1618 -> Chat: CVI's remain bullish
2010-12-21 17:51:32 [Message] fib_1618 -> Chat: as do the STVO's and VTO's
2010-12-21 17:51:38 [Message] fib_1618 -> Chat: not "overbought" and not neutral...
2010-12-21 17:51:58 [Message] fib_1618 -> Chat: pretty much staying within the guidelines of a trending price structure
2010-12-21 17:52:17 [Message] fib_1618 -> Chat: NYSE TRIN at .60
2010-12-21 17:52:26 [Message] fib_1618 -> Chat: Open 10 at .74
2010-12-21 17:52:43 [Message] fib_1618 -> Chat: still technically "overbought" but it can stay that way if the trend is strong enough
2010-12-21 17:52:56 [Message] fib_1618 -> Chat: again...context is so important here
2010-12-21 17:53:03 [Message] fib_1618 -> Chat: being that we're dealing with an oscillator
2010-12-21 17:53:13 [Message] fib_1618 -> Chat: they tend to work their best magic during price consolidations
2010-12-21 17:53:17 [Message] fib_1618 -> Chat: when prices are trending they can remain at extremes for longer periods of time
2010-12-21 17:53:38 [Message] fib_1618 -> Chat: and this could be the current case
2010-12-21 17:53:52 [Message] fib_1618 -> Chat: NASDAQ TRIN at 1.00
2010-12-21 17:54:01 [Message] fib_1618 -> Chat:
2010-12-21 17:54:07 [Message] fib_1618 -> Chat: Open 10 at .96
2010-12-21 17:54:26 [Message] fib_1618 -> Chat: so "this side" over being "oversold"
2010-12-21 17:54:47 [Message] fib_1618 -> Chat: which suggests that the NASDAQ should have the bigger bullish pops near term
2010-12-21 17:55:01 [Message] fib_1618 -> Chat: TM TRIN At .80
2010-12-21 17:55:09 [Message] fib_1618 -> Chat: Open 10 at .85
2010-12-21 17:55:13 [Message] fib_1618 -> Chat: so...
2010-12-21 17:55:28 [Message] fib_1618 -> Chat: it would appear that we're starting to make some decisions here
2010-12-21 17:55:46 [Message] fib_1618 -> Chat: any follow through tomorrow would be enough to move long again in an aggressive way
2010-12-21 17:56:11 [Message] fib_1618 -> Chat: the Open 10's are suggesting that money has been rotating out of the NASDAQ and into the NYSE
2010-12-21 17:56:30 [Message] fib_1618 -> Chat: but near term...the NASDAQ has more upside potential because of the physics involved
2010-12-21 17:56:52 [Message] fib_1618 -> Chat: so the nod goes to the bulls...let's see what they're really made of
2010-12-21 17:56:57 [Message] fib_1618 -> Chat: anything else?
2010-12-21 17:57:16 [Message] fib_1618 -> Chat: as a reminder...there WILL be a chat tomorrow and that will make up for last week
2010-12-21 17:57:49 [Message] PriceWatcher -> Chat: The potential divergences on the volume MCOs are they something to watch for?
2010-12-21 17:58:07 [Message] fib_1618 -> Chat: we are watching for direction only
2010-12-21 17:58:19 [Message] fib_1618 -> Chat: until the MCO's move to lower lows
2010-12-21 17:58:27 [Message] fib_1618 -> Chat: and break their series of bottoms above bottoms
2010-12-21 17:58:46 [Message] fib_1618 -> Chat: it's only something to acknowledge but not trade off of
2010-12-21 17:58:52 [Message] fib_1618 -> Chat: the MCSUM is your key indicator now
2010-12-21 17:58:56 [Message] PriceWatcher -> Chat: OK
2010-12-21 17:59:09 [Message] fib_1618 -> Chat: this is NOT a short term price move
2010-12-21 17:59:17 [Message] fib_1618 -> Chat: it's of intermediate term variety
2010-12-21 17:59:30 [Message] fib_1618 -> Chat: we must compare equally...apples to apples
2010-12-21 17:59:56 [Message] fib_1618 -> Chat: OK...if there's nothing else
2010-12-21 17:59:59 [Message] fib_1618 -> Chat: I'm going to take off
2010-12-21 18:00:06 [Message] fib_1618 -> Chat: everyone have a great day tomorrow
2010-12-21 18:00:15 [Message] fib_1618 -> Chat: and we'll do this again 22 hours from now
2010-12-21 18:00:16 [Message] thespookyone -> Chat: thx!
2010-12-21 18:00:16 [Message] fib_1618 -> Chat: good night
2010-12-21 18:00:20 [Message] PriceWatcher -> Chat: Thanks! U too

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

Previous Topic | Next Topic

Quick Navigation:

Easily create a Forum Website with Website Toolbox.

Copyright 2000-2019 Technical Watch