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mortiz

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Reply with quote  #1 

Hopefully gman or cheif will weigh in with their comments on the latest climax indicator interpretations (and John will post some of his MetaStock CLX charts).

 

Below are the updated CLX and CLXpp offsets due to fall off in the coming week, with the values falling off designated in a red font, first the Dow.  The values posted this past week are "unofficial" CLX and CLXpp numbers for the Dow.  String of favorable 30 day offsets for most of next week, 10 day offsets favorable early next week.

 

 

The Dow CLX 10 DMA remains above the 30 DMA, with both now rising, a good sign.  Note how the 10 DMA bounced from the zero line.

 

 

The Dow AYDIS (CLX minus CLXpp) MACD variant, idea stolen from "Joanne", is again above its blue signal line.  From my limited experience in observing the behavior of this indicator, it appears prices perform best when the signal line is above zero... if the MACD indicator can remain above zero a bit longer, the signal line will follow.

 

 

The NDX CLX and CLXpp offsets due to fall off in the coming week are also designated with a red font.  The 10 day offsets are mostly favorable for the coming week, while two particularly unfavorable 30 day offsets are due to evaporate Thursday and Friday of next week.

 

 

The NDX CLX 10 day MA (blue curve) briefly exceeded its 30 day MA (black curve) a week or so ago, then fell under again, but has turned up again.  The NDX is finding difficulty in gaining traction, and will continue to do so until the 10 day CLX MA can remain above its 30 day MA for more than a day or two.  Note how the NDX CLX 30 day MA has managed to remain, on-balance, above the zero line for the majority of 2006.

 

 

The NDX AYDIS MACD indicator managed to scratch its way above zero again Friday, but is having a difficult time finding any traction for a sustained up move.  The black signal line will likely need to crawl above, and remain above zero before NDX prices can undergo a sustainable price rally.

 

 

The SMH CLX and CLXpp offsets due to fall off next week, again highlighted in red.  A mixed bag with the SMH 10 day and 30 day offsets in play for next week, but the bias is toward unfavorable offsets.

 

 

The SMH CLX 10 day MA pulled the same trick as the NDX a week or so ago, by nominally exceeding its 30 day MA, fell back under to regroup, has turned back up above zero, but needs to get back above its 30 day MA to spark a sustainable rally in this index.

 

 

The SMH AYDIS MACD has been congesting around its zero line for sometime now, with a bias below zero, as its signal line is still in negative territory.  As with MCOs, congestive patterns about the zero line usually, but not always, resolve in "falling out of the zone", as opposed to breaking to the upside.  Time will tell how this congestive pattern resolves.

 

 

The first three days next week going into Weird Wollie Wednesday will likely set the tone for the action going into OPEX week.  As cheif says, da boyz will likely set themselves up for the OPEX payday, and we'll likely know if the paycheck will be from the short or long side by mid-next week.

 

FWIW

 

Randy

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swingtrader

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Reply with quote  #2 

Randy,

 

How could we figure out the opex is going to be on the long or short side? What is typically the rules?

 

Thanks.

 

Swingtrader

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mortiz

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Reply with quote  #3 

Hi Swingtrader,

 

Welcome to Technical Watch and thanks for participating.

 

You have asked a good question where the different answers would equal the number of people asked.  The Wednesday before options expiration week is known as "Flex Wednesday" or "Weird Wollie Wednesday (WWW)" where the theory is "da boyz" are influencing price movements going into WWW while positioning themselves in options for a move in the opposite direction around mid-week prior to OPEX. 

 

Don Wolanchuk, aka da cheif, is a pioneer in CLX interpretation, although the indicator was originally presented by Joe Granville. cheif invented the CLXpp component and combined CLX and CLXpp into one indicator dubbed AYDIS.  cheif commented Thursday 5-4-06, upside acceleration would begin no later than Wednesday of next week (May 10th).... we saw acceleration the very next day.  cheif has also mentioned the -20 Dow CLX offset scheduled to fall off at the close of WWW as key.

 

Some very credible analysts, using different timing techniques, have a bottom arriving the middle of May, thus the earlier comment in this thread the next two or three days will likely provide clues as to the bias going into OPEX week.  Sentiment is on the side of the bullish case right now with an amazing level of disbelief of the upside price bias over the past few weeks.

 

In addition, liquidity is still strong, and the McClellan breadth oscillators are beginning to show strength again, with some variants postured for potential initiation thrusts with any follow through of Friday's action.

 

I am sure there are many credible arguments for the bearish case over the next couple of weeks, and I hope we continue to hear the bearish case vocalized by as many analysts as possible. 

 

However, the bottom line is anything can happen leading into OPEX week, so all we can do is remain flexible in the near term.... and use close stops for our shorter term accounts.

 

FWIW

 

Randy

 

 

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hiker

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Reply with quote  #4 
this is simply two items I have in my bag of tricks....sustained and rising closes above:

the SOX d/t line drawn off the Jan high

2353 on the Composite

if these two items once again become technical support, the character of the market with broader technology participation in strength may be changing. Last week showed some signs of a desire to do so, and notice the rising trendline support for SOX and the move above 520 -

http://stockcharts.com/gallery/gv?sox

I have been talking about this subject in this thread since January..scroll to bottom for updates -

http://forums.technicalwatch.com/tool/post/fib_1618/vpost?id=840964

I know this is not directly related to this CLX conversation....just part of what I am watching re: are we above or below support/resistance? That is all I usually care about....my crystal ball usually just keeps me from doing what I do best. 


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swingtrader

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Reply with quote  #5 

Randy,

 

Great post. Thanks so much.

 

Swing

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