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Thursday, October 18, 2012

Daily update 10/18

I made a mistake not upgrading the short term trend to neutral last night.  I have not quite gotten into the habit of looking at that everyday yet.  It would not take much to turn that trend up, but that may not happen.
 
Wild day for GOOG shareholders.  I guess if you were planning to do a trade for earnings near the end of the day you got screwed.  Here is the daily SPX chart.


SPX had an outside day on an increase in volume.  This is a reversal type pattern, but does it count?  The reversal happened on the premature earnings news about GOOG.   If this same pattern had happened with no news, I would say there was pretty good odds we just saw another top and a pullback is likely.  We will have to wait and see what happens tomorrow.  Here is the 60 minute SSO chart.


This chart is on the verge of rolling over.  The 50 SMA already has a death cross on this time frame being clearly below the 200 SMA.  We ended the day below the 18 SMA so this chart can be turned down very easily in the morning.

Both the NASDAQ and the Russell2000 were down much more then SPX today.  The NASDAQ clearly looks like risk off mode.  Will anybody notice?  The market is fragile here if the bears decide to pounce.
A close below today's low should usher in more selling.

Bob

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The information in this blog is provided for educational purposes only and is not to be construed as investment advice.