TRIN is 0.69 another day in the cellar stoking the bull furnace. VIX drops under 12. Keystone thought 13 would hold, then 12.8, but volatility is now at 11.90. Charts remain positively diverged with the lower price so a spike up in VIX remains on the table. The out months are priced higher for VIX at 16 and up but bears do not want to wait for another eight weeks for a market pull back. The low TRIN and low VIX is an unbeatable combination for the bulls today. The SPX is trying to move above the important and strong 1553 resistance. The path to 1560-1580 opens if 1553 gives way.
The 2-hour, 1-hour and 30-minute charts continue to remain negatively diverged, with rising wedges, and the RSI appears to be lining up for the bears as discussed in the previous chart, so market weakness is anticipated. The RUT (small caps) and tech remain weak as compared to the broad indexes. Copper was down strongly this morning but recovered back to positive, now a shade negative again. GTX is 4864 lower today. The strangeness continues, copper and commodities weak, oil weak today, but the equities markets do not care that there is less need for raw materials and electricity, and instead move higher. Go figure. Volume is pathetic with a run rate for the broad markets only at about two-thirds of a day's average volume. Nonetheless, the bulls keep running. This afternoon may be interesting once the negative divergence locks in for the 2-hour, 1-hour and 30-minute charts, which should be about now, and cause a spank down. Bulls will rule, however, if the TRIN remains at 0.69. Bears need to move the TRIN back towards 1.00 and higher.
Note Added 3/11/13 at 1:05 PM: Note the bulls pushing the RSI above the prior level on the 2-hour and 1-hour charts. The bulls are squeezing every last drop of juice out. This should extend the move for one to four hours which now may take things into tomorrow. TRIN is 0.66 and VIX now at lower lows to 11.73. The SPX moves above 1553 now above 1554, the bulls are relentless.
Note Added 3/11/13 at 2:27 PM: The SPX is at 1555.50 with the bulls pushing higher. These prints now are new 2013 intraday highs for the SPX. The HOD and new 2013 high is 1555.55. TRIN is 0.72, very bullish. VIX at 11.75, bullish and complacent, verifying the low 0.71 CPC put/call ratio print from late last week that signals complacency. Traders know the Fed will pump forever and also that the politico's will always kick the can so they hum the song, 'don't worry, be happy'. Even Alfred E. Neuman is buying stocks and saying, "What, me worry?" The 2-hour, 1-hour and 30-minute charts continue to set up for a negative divergence spank down but a couple more hours may be needed which would push it to the opening bell tomorrow. With TRIN at 0.72 the bears have no hope for downside today but the low TRIN simply winds the spring back stronger. It will be interesting when the TRIN, VIX and CPC explode higher. For now, the bulls push to the next resistance at 1556, then the all-time closing high at 1565.15 would be attacked. Note that the 1556 R is holding the SPX back so far which has printed a HOD at 1555.55. The euro is 1.3036, flat as a pancake today. The 10-year is 2.05%, it was a tick higher this morning, so the yields are not moving up with equities as should be expected. Copper turned positive and is strengthening as the day moves along helping the bulls but commodities in general remain weak.
Note Added 3/11/13 at 2:49 PM: Here's the test of 1556 resistance. High drama. New all-time highs are a virtual lock if the SPX moves up through 1556. There is no other resistance above until the closing all-time high is tested at 1565.15. If bear's are able to pull out a can of spinach like Popeye to save the day, they had better do it right now.
Note Added 3/11/13 at 3:40 PM: The bulls pushed through 1556 for one minute but the bears held the 1556 R and spanked price lower. TRIN is 0.71 so the bulls can keep the SPX elevated into the close. VIX remains under 12 but is showing signs of life. The new moon is occurring right now so it will be interesting to see if the SPX is weak through the new moon and if the 1556 high today provides a short opportunity into tomorrow. The 2-hour and 1-hour charts are set up for weakness tomorrow. AAPL is moving higher so it may receive some mojo as shorts cover. GOOG is likely at its peak right now.
Note Added 3/11/13 at 4:03 PM: The bulls close the SPX sitting exactly on top of the 1556 S/R so everyone has something to think about overnight. The fix was in favoring the bulls with another day of low TRIN readings. The VIX is under 12 adding bull fuel. The CPC put/call will be interesting this evening. The TRIN will recoil and spike above 1.00 likely tomorrow. Overnight would be a perfect time for an event out of left field since it would hurt the maximum amount of bulls and bears. The bulls are complacent and care-free holding long and strong, and most short sellers are sitting on the sidelines waiting for an opportunity to short. The SPX prints a new 2013 intraday high at 1556.27 and a new 2013 closing high at 1556.22. The Dow Industrials print a new all-time high at 14448.06 and new all-time closing high at 14447.29.
after 5-10 years, during an audit at FED, everybody will find out that FED bought ETF's and other instruments to maintain the stocks higher and higher ... to "save" the economy...
ReplyDeletebut...without any long-term effect.
"the bulls are relentless. "
ReplyDeleteNo.
They are not relentless. They are sustained with FED printed money.
They cheat in this game, KS.
If the spx index would move based only on fundamentals and macroeconomics, the bulls would have been quite ...impotent.
This game is rigged.
No wonder the volumes are SO THIN!
V.
Semantics, dude. Liquidity=Bulls. Liquidity, with QE infinity and beyond, is relentless, thus bulls are relentless. BUT, price still has to adhere to natural forces and processes!! Always.
DeleteNote that at this point, it has been estimated, that the FED has added 500-600 points to the SPX since the 666 low. The rest is pure private investing.
The game is always rigged, has been and will be, since there's soooo much money to be made. No need to get hung up about that. Don't try to fit the market to your believes, it won't work and cost you your entire account. Just ride along, make profits, be neutral, objective and trade the trend. Keep the "it's unfair" talk to cocktail parties, and don't regard the market as your enemy, but as your friend! it will make you a better trader.
I think that blaming the Fed for the market's direction is facile. In fact, if you look at the direction of the market and the times when the Fed pumps, you will see no meaningful correlation: http://www.zerohedge.com/news/2013-03-04/shorting-market-these-march-days-will-be-hazardous-your-health.
DeleteVol is thin as nobody is buying anything but the fed themselves..no doubt patting their own backs in a job well done..
ReplyDeleteIn thin volume it is easy to push the jello around the plate, so the bulls can keep pushing higher. The volume is going from light to vapor. Yes, it is actually losing pace as the day moves along. The 1553 was key resistance, now support, next is 1556, this is the last chance corral for bears to hold back new all-time highs. It held so far with HOD at 1555.55.
ReplyDeleteWhat just happened with Apple? It just jumped like a hooker at a cocktail party.
ReplyDeleterumors of $30 special dividend... This may be the kick start of the move out of the rising wedge KS has been showing. I am long since 422, nice and green :-) !!!!
DeleteSome forecasting, simply using FIB levels. Note that I have the wave 1 of the SPX top at 1438. Wave 3 hit the 2.00x extension exactly (1531), which is extended for sure, but not uncommon. Wave 4 (to 1485) retraced exactly to the 1.50x extension of wave 1.
ReplyDeleteCurrently, price is right at the 2.236x extension (1554) of wave 1. Well within the margin of error if I may say so.
Using the wave i of 5 extension (1485-1525), price closed that 1.618x extension on Friday and may want to target the 1.764-2.00x extension area, which is 1556-1565. The wave 5 does now count as complete though with 5 waves up, to 1556, but may want to see another 4 and one last 5 of 5 of 5... to hit the extension area, which is also very close to the 2.236x extension lies.
Again, very limited -if any- upside left IMHO....
SPX 1556 resistance held so far with fifteen minutes of trading remaining. The 2-hour and 1-hour charts are set up for weakness tomorrow and may print doji candlesticks a the closing bell.
ReplyDeleteERY added more. Bought a hot dog as KS would say, in at 5.67 out at 5.72. WSJ article, energy is going to get spanked down. Watch the overbought MPC, etc. Keystone with ya, let's see ERY make a move out of the gutter.
ReplyDeleteKeystone was going to take profits on ERY but let it ride, so of course it is underwater now. Tomorrow in general is setting up to be an interesting day.
ReplyDeleteI would hold position with ERY until end of week at least, possibly next month. they are in the 6-1 split that's coming. Not a great play , but I think a smart one
ReplyDeleteKeystone - any thoughts on the move up in gold? I saw some ratio charts on Bill Cara's week in review blog last night showing miners (GDX) are starting to outperform $GOLD and the juniors (GDXJ) are starting to outperform miners. On that note I took a position in IAG today showing some signs of life.
ReplyDelete