Tuesday, November 18, 2008

11.18.08 - Price Rising / AD Line Falling

Note how the Advance-Decline and Cumulative Tick lines have fallen even as price has risen. So far the VWAP has held, but be careful out there. I'm closing down the "What Hurts More?" poll below and to the right today. So far watching "Cramerica" takes it (lol)!

[Gratuitous INO TV Online Seminars Link]


o Calc Risk/ Credit Crisis Not Easing
o Quant Edges/ Pending Bounce?
o VIX & More/ HV MA Rolls
o BBC/ Wholesale Prices Plummet
o BBC/ Bailout not a Panacea

8:50AM PST: Indicator slopes have reversed mildly to the good.

9:00AM PST: At this point keep a close eye on HH/HL pattern sustainability and support at the daily Pivot (SPY $86.30).

9:15AM PST: Semis are diverging to the downside (add: and indicators are oscillating/unstable). When the majors begin to diverge, it's my observation that trends can stall or fall apart. Just a heads up.

10:20AM PST: Ahh, not good. Hope you caught the earlier post when we were still above the Daily Pivot. Declining volume is far outpacing and internals have really fallen apart. May see support between here and S1 ($84.10) but... well, time will tell, no? (Wait for confirmation, no blind hope trading!) Volume is extremely low at the mid-day.

Oh And -- Good-Bye BUD:

[Google Chart]

10:45AM PST: The VIX is trading up 3.2% over 71. Speaking of BUD, longs might be reaching for "long necks" if we really fall off the cliff just here... see, just can't post these fast enough... there we go (S1 breach).

10:55AM PST: Supportive volume spike, can it turn it around? Maybe, but wait for a higher low.

11:35AM PST: Careful. Nearing new closing lows on the year...

12:10PM PST: Second try at a turn. Check out the comments today for more on floor pivot breaches. Now, possible VWAP Resistance. VIX off its highs in the 73 range. I'd guess S1 holds this time... nope... gotta give it a little room though. Seems we keep hitting a wall at SPX 845 this late afternoon.

12:30PM PST: Wow, a real battle going on at this level... doesn't look good, does it? If it can hold, technicians will call it accumulation basing; if it doesn't, a break down out of the descending triangle.

12:50PM PST: Pheww! [Add: We hold and catapult ahead of the auto hearings.]

RSI Gadget Test: What do you think? Doesn't look "current" to me.

1:30PM PST: Interesting close. Finally a "key reversal" (nearly)? Hard to have any conviction in this environment beyond playing the noise. [ADD:] Rumors it was a BUD rebalance trade. Today saw it all though -- a gap down, a fill with higher-highs and lows, straight down trending, an inverse head and shoulders and subsequent chop, then a short covering burst with perhaps a touch of real buying into the close (assumption based on the volume come back). Amazing -- see you tomorrow -- good to be "back in the game."

Late at Night: PSS - Hope you noted that IWM/ Small caps did not particpate in said rally much at all. Yeah, I'd like to see a follow-on rally too, but wait for it muchachos. Long Neck Cheers - Jeff

Never Investment Advice


Nefri said...


but if it breaches, doesnt that necessarily mean a move down?

Jeff Pietsch, CFA said...

No, just indicative of the trend we are facing and it becomes technical "resistance" on way back up. Right now we are continuing to break down.