Posts Tagged ‘XLF’

• Recovering Market but Still Fragile
  alphatrends, December 9th, 2011 at 6:19 pm

  The battle at the 200 day moving average continued in the $SPY this week and after being rejected from that level on Thursday, the market fought back impressively today.  The big rally we saw two weeks ago seems to be getting absorbed through a time correction rather than a deeper price pullback and that is positive because it shows there is a stronger sense of urgency for buyers.  Markets are not healed yet, but the process of price recovery is more encouraging than it has been in a while.

  

• S&P 500 Up 7.3% This Week, But Still Down For Year
  alphatrends, December 2nd, 2011 at 4:30 pm

  Last Friday the market closed on the low of a week long selloff and the market looked terrible.   On Monday, the markets exploded higher with a large gap, which left shorts scrambling to cover and sidelined cash wondering if it was just a blip in a downtrend.  As the market held the gains we saw another large gap higher on Wednesday which further pressured shorts and make disciplined traders who are accustomed to “cleaner setups” feeling like they once again missed out.  Of course there were intraday opportunities and some decent setups, but most of the people I know felt like they missed a lot of the action.

  To keep things in perspective, the $SPY is still negative YTD, despite a massive 7.3% rally this week.  The market volatility has been phenomenal this year and there is no reason to think things have settled down or become more normal.  The video below discusses some of the key levels to keep an eye on from here.

   

  

• Retracement Levels Being Hit in SPY and QQQ
  alphatrends, November 30th, 2011 at 2:12 pm

  Reasons for today’s strength can be found all over the internet, the discussion here will remain focused on price action.  We have been observing the Fibonacci retracement levels from the October highs to the low from last Friday and today the market is reminding us of why it is good to use these price tools for reference points.

  The $SPY has exceeded the prior support at 122 which would have been a logical place to look for resistance and has instead rallied up to the 61.8% level where it appears it should level out and digest the gains.

  The 56 level is important for $QQQ because it is; prior support, ~50% retrace and approx level of the declining 20 and 50 (not shown) day moving averages.  It seems there should be consolidation in this area.

  

  Yesterday I expressed a lack of confidence in continued strength and if you shared my viewpoint then today’s large gap up ruined the opportunity for low risk entries.  It is normal to question a patient and disciplined approach when the markets make such a large move and you are not participating.  I always like to think of the phrase “it is better to be on the sidelines in cash wishing you were in than it is to be in the market wishing you were out.”  Patience and discipline always reward us in the bigger picture.

• Market Clarity?
  alphatrends, November 28th, 2011 at 4:32 pm

  Today’s action was quite erratic and did little to provide any clarity to trade with confidence. The video below does show that there is some logic to the way prices are acting, but it is very difficult to have much trust in the action.

  

• Rough Week for Stocks – Video
  alphatrends, November 25th, 2011 at 2:34 pm

  It was a rough week for stocks as key support levels were broken and selling persisted. Right now there are no signs of new support levels being formed and a defensive posture remains prudent. While markets remain below their declining 5 day moving averages they should be considered guilty until proven innocent.

  

• Moving Averages are Just POTENTIAL Support Levels
  alphatrends, November 21st, 2011 at 4:21 pm

  There are times when a moving average will offer trend support or resistance to the penny and a lot of that has to do with the self fulfilling nature of technical analysis near widely watched levels.  The 50 day moving average is a very widely watched technical level and many people were looking to buy as the market touched that level.  Well the $SPY gapped down and closed below the 50 dma, so the perceived opportunity to buy never materialized.

  I like to say that the moving averages are just a reference point to compare trend to and that they give us an idea of when to look a the action on a shorter term timeframe.  The video below describes more…

  

• Financial Stocks Still Reason for Concern
  alphatrends, November 16th, 2011 at 12:39 pm

  Almost as soon as I hit send on yesterday’s post of the updated charts below, the market rallied nicely.  Today we are back to choppy trading in nearly the same spot.  The $XLF remains the primary concern as it appears to have made another lower high above the critical 12.80 level.  If the XLF downtrend line is taken out and the recent lower high is exceeded it could lead to a squeeze, dont’ get complacent in either direction here.

  Action in $SPY $QQQ $IWM is more neutral as the market awaits some kind of catalyst, what will it be?  Until we have a resolution it seems best to continue with a cautious stance and the light volume suggests that is the consensus.  Which brings up the the thought that when everyone is waiting for something to happen and it seems boring, that is often the time to be most alert.

  

• Stuck in Ranges
  alphatrends, November 15th, 2011 at 12:00 pm

  Trading volume is very light once again and markets are stuck in ranges above key support levels.  The blue horizontal lines represent the volume weighted average price from the October low through current prices.

  You can see the $XLF has struggled with that level the most, but prices remain above that level which is also critical horizontal support ~12.80  Breaking below 1280 and staying below would likely cause weakness in the broader market.  If however we get a break below and quick recovery it could be the catalyst for a squeeze.  Stay on your toes, anything can happen here.

  

• Key Levels Still Hold
  alphatrends, November 14th, 2011 at 4:25 pm

  The $SPY continues to battle with the 200 day moving average and the year to date positive column. As long as the key levels outlined in the video below hold we will be cautiously optimistic over the intermediate term.

  

• Stock Market Video Analysis 10/31/11
  alphatrends, October 31st, 2011 at 4:30 pm

  Markets finished with losses on the last day of the month and it put the $SPY back into the losing column YTD, but the monthly numbers were still very bullish. See the video below for key levels going forward.