Wednesday, May 27, 2015

More Selling Ahead

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$NYA: NYSE Composite is in sell mode. Bounce or not the next day, it does not matter, expect more weakness ahead. See annotations in chart.



$NYMO: Suggests more room below if that where it wants to go

SPY Hourly: Bottom of channel is potential target in near future


VIX: Likely to tag upper BB sometime this week

SPY/NYA Daily: I won't be shocked if price wants to tag the 200SMA sometime in June.


SPY Weekly: Noticeable negative divergence and MACD histogram back to sell side.


$CPCE: Still in sell mode since signal triggered on 05/21


I'm aware that the overall trend is clearly up. So far selling is just a a mild and typical pullback, and is healthy to have. Above chart is a 4 year daily chart, showing at least numerous times of 5% pullbacks in past 4 yrs. I'm not saying that we will have one now, but if there is one, it is fairly possible to be one now based on seasonality, my observations of price action, market internals, and short term indicators.

Tuesday, May 26, 2015

PUMP & DUMP?




My observations of Big Money pump&dump actions are annotated in the SPY daily chart above.  For visual aid purpose, I marked unusually high volume (above avg volume) bars after initial price markup with red ovals, and corresponding green price bars with purple arrows, and gray rectangular boxes are retailer chasing price and buying at top. Also, blue arrows and  ovals are initial price mark-ups.

First evidence of pump&dump action by Big Money occurred on 12/18/14, (a huge green spiker bar w/ high of 212.97). Of course price still could go up (several) days after this pump&dump action due to retailers mistakenly seeing  the unusually high accumulating volume as a buy confirmation, because from text books we all learned that higher price accompanied by expanding volume is a green light for going long. As for this case, price sustained above pump&dump action for six trading days, but the accumulating volumes were significantly less. As the Big Money is out of the equation,  and the only ones left were just a bunch of retailers holding the bags with no more new buying interests, price fell hard exceeding the low (yellow horizontal line) of the pump&dump day.  Same observations and results for other pump&dump actions happened on 01/22, 02/20, 03/18, and 05/14 a potentially pump&dump. If it is the case, price should resolve lower than 210.9, which is what I'm expecting before another big run up or price markup buy Big Money. 
Keep in mind these are just my observations, and there are no guarantees that how price will play out as such. For now just take it with grains of salt, but don't forget to grab a seat when the music stops.
Good Luck and Happy Trading!



Monday, May 25, 2015

Long Set-ups (GPRO, FB, KNDI, HZNP, DSKY, NKTR, WETF)

DSKY
 FB
  GPRO
 HZNP
 KNDI
 NKTR
WETF

Intermediate Top May Be in




 Right click to open image in new tab, then left click to enlarge


Chart above illustrates price action of each component and market breadth. It appears that price and breadth are reverting to the mean (10ema). 

$NYA: Could be rolling over. Below 11190 will likely see 11130 
SPY Daily: Below 212.91 will likely see 212.5


VIX Daily: Usually bounces here as long support holds.

SPY 5min: First time in a while price closes decisively below 5dma.



CPCE Sell triggered (Short term sell signal)




Advance-Decline Lines: Mid and Large Cap market internals are ok, not so much of negative divergence as seen with Small Cap, NYSE Composite and Nasdaq.


SPX- Daily Negative Divergences: Expect short term weakness as negative divergences are intact and price is beginning to pullback.


Based on observations above and previous posts, I think some pullback shall be expected, and eventually price will breakout of the tight range between 212.5 and 213.8. I am leaning toward breakout on the downside so will expect more weakness below 212.5.

Even if price decides to make slightly higher high (213.78) sometime this coming week. I do not think gains  can be sustained and all gains likely be raised. 

Friday, May 22, 2015

Looking for a Retest of 212.5




No doubts or questions regarding the short term current trend, it is clearly up as shown on the hourly chart above. However, for short term trading purpose, I am cautiously bullish at best especially when price is near the resistance of its range. Until 213.78 is clearly breached at least on the hourly chart, I will not hold any short term longs here. Also based on price and volume action thus far, I am expecting a throw back to retest 212.5, at least one more time. If support holds there, then expect more buyers stepping in with stronger conviction of a successful breakout. Until then, I will get used to trading this small range  between 212.5 and high 213s, meaning selling at resistance and buying at support.

By the way, for clarification, I'm long term and intermediate term bullish, and neutral for short term until the mention range bound is clearly taken out.