The upper BB is 1573 so the bulls may try to punch the SPX higher to tag the upper BB today. The BB's are coming in and tightening so a big move is on tap for markets this week. The tightening BB's do not tell you what direction, only that a big move in one direction or the other will occur. The prior tightenings (pink boxes) result in identifying the September-October top, the late December sell-off and the late February selloff. The December selloff was stick-saved by the fiscal cliff resolution. Both of these moves this year were down moves but the bulls quickly reversed price as soon as the lower BB was touched. Thus, when the SPX moves lower in the days ahead, watch the reaction at the lower BB. If they markets are rolling over the lower BB will start to drop and allow price to keep falling. In late February note how the lower BB turned flat and then back upwards ruining the bear's fun. The SPX remains elevated well above the 200-day MA and a reversion lower is needed.
The 20-day MA at 1553.03 likely needs tested. The 50-day MA at 1525.46 as well. The volume on Thursday's SPX move through the all-time closing high was stronger than recent days but only in line with the volume from the 1550-1560 level. Therefore, a move into this range is needed for a test and the range encompasses the 20-day MA. Big excitement is ahead this week. The chart says down ahead but the Fed's money-pumping is strong. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Good stuff as always Keystone.
ReplyDelete2013 is looking to be another 2010 for me. That was the year that I lost 10% while stubbornly trying to short the market while everyone else made huge sums by being bullish.
So far I'm down 3% this year shorting.
I have been slowly building a position in NUGT. $5 looks to be strong support. Have a reverse split coming up I believe. There is bullish divergence on several oscillators.
$GOLD is looking to stabilize and showing favorbale chart patterns: %B over .50, MACD lines heading above 0, RSI heading above 50.
If $GOLD can't find support around 1560, I'll be out.
Well, Keystone is looking for a top here and the call has not been good thus far, but the tops do usually take 2 or 3 months. Being 3% down is nothing from a speculation standpoint, some of Keystone's inverse ETF's are underwater far deeper right now. Risk tolerance is the key to decide how much pain to handle. Most traders set a mental stop at about 2% or 3% where they will take the loss and exit the trade, which typically works out to be the correct and best thing to do. For speculation, more leeway is given. The Fed money pump is powerful and it helps overcome the chart negativity but the markets do appear ready to roll over now.
ReplyDeleteKeystone has been watching NUGT as well. Some of the ETF's are reverse splitting today, like FAZ, so maybe it is on tap as well. NUGT is setting up nicely with positive divergence, oversold conditions, the daily chart is moving sideways trying to hold the 20-day at 5.42, now at 5.41. So this current level is important. The 5.2 would lead to 4.8 according to the 80/20 rule. It is not necessary for price to come back down to test the 4.8-ish low since the charts are already positively diverged so it looks very attractive moving forward (in the context of knife-catches which most picks here are). NUGT can probably be bot here at 5.4, then at 5.2, then at 4.8 if it prints, but a basing here at 4.8-5.4 appears very likely and upside ahead as the weeks play out.
Gold may move through 1550-1700 all summer long into the fall. The concern form the bull side is that the RSI on the weekly chart never made it to oversold levels which does leave the door open for some further downside perhaps to the 1480-1550 support and congestion zone from 2011. But sideways may be the operative word for gold for the forseeable future.
ReplyDeleteGood points.
ReplyDelete$gold weekly chart looks weak. Is so far riding 10 wk ma down. I'm looking for positive break up towards ~1650.
The support line of ~1550 goes back to spring of 2011, so I'm waiting to see if it holds.
Per the $SOX, it is looking weak and I have my eyes on SOXS.
I have wondered, have you ever thought of buying puts or selling calls on leveraged inverse ETFs? They have shown themselves to be one of the most structurally flawed vehicles out there in the long term, much worse than their bullish leveraged counterparts. The "decay" of levaraged inverse ETFs is spectacular. I am hoping to do this after getting a good market correction. UVXY and TVIX seem like a money printing machine for the shorter of volatility.
SSG is another inverse semi play. There are many ways to play and you are correct on the decay.
ReplyDeleteThanks again Keystone. You do spectacular work here. May your success continue and broaden.
ReplyDelete