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Friday, November 30, 2012

Daily update 11/30

Somebody wake me up please.  That was a snoozer day.  Here is the daily SPX chart.

I have removed the down trend channel lines since recent price action invalidated them.  I have placed a trend line below the current rally.  That is one steep move and at a lower high.  It is a bit hard to imagine it does not have a pretty big pullback when it ends.  Today was an inside day and a doji bar.  Doji bars after a long move can be a sign of an impending reversal.  It needs confirmation like a close below today's low.  Lets zoom in to the 195 minute SPY chart.

I really screwed up on Wed.  I did not look at this time frame before the close I looked at the 130 and thought 50/50 odds on a gap up.  Therefore, I did not hold long overnight.  This time frame was clearly bullish going into the close.  The biggest problem for me is that I can't think of a good excuse.  I usually look at this time frame along with the 130.  So why did I skip it this time.  Had I held long, which is clearly within my rules, my bad day on Thursday about being wrong on the gap fill would not have been so bad at all, LOL.  SPY tested my resistance line today, but failed to stay above it.  This is the first time on this rally this chart is in a position where it could roll over fairly easily.  I think I got a little sloppy in my analysis this week. Sorry about that.  How about we blame it on all the turkey I have been eating!  Lets peek in on the 60 minute chart.

SPY is now sitting just above the 18 SMA.  I kind of think I want to be short if we break that while we are below the daily 50 SMA.  With the 18 SMA almost up to my resistance line, one of them has to give soon.  If the rhetoric coming out of Washington next week is still we are miles apart on a deal, the market could initiate a pullback.  Remember this price action is happening inside the post election big gap down.  This could be really big resistance here. 

The sub intermediate trend changed to neutral today, losing the downward bias.  Based on how this trend indicator works, the market should roll over right around here if this up move was just a corrective type move.  If we go much further up it will start to look more like a kick off of a possible test of the Sept. high.

Chart practice has been updated with DE the stock for today.

Have a great weekend all,

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