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Wednesday, March 12, 2014

Daily update 3/12

Another mixed day.  SPX closed fractionally higher at the key 1868 level.  I just love this totally random market, LOL.  Here is the daily SPX chart.

We had a little gap down this morning and SPX traded down to the 18 SMA.  The bulls showed up and rallied SPX back to even.  The rest of the day was a back and forth motion with another bounce into the close to get SPX positive again.  New highs dropped down to 53 today.  With just making a new all time high and price still above the 18 SMA that is extremely weak.  Its a bit hard to have confidence we are going to rip higher.  Lets take a look at the SPY 60 minute chart.

A lot of alternating bars up and down today.  SPY is below both the 18 and 50 SMAs.  All afternoon the bulls defended yesterday's low (186.8).  If we break below that level I would expect an increase in selling pressure. 

The bulls showed up today, but I can't say they rescued the market.  Without an increase in new highs we are not going very far on the upside.  I want to see a confirmed break of the SPY hourly 50 on the upside before considering new long positions.  Will the bulls show up with some force tomorrow or will the bears strike again?  The new high data suggests the bulls are losing control.  I guess we will see what happens.

I thought this was an interesting chart.  I have been talking recently about how things remind me of the 2000 top.  Check this one out.

Nearly 75% of IPOs over the last six months have negative earnings.  Kind of looks familiar doesn't it.  Can you say dot com bust.  Why are the venture capital firms rushing out non-profitable IPOs?  Could it be cashing in while the getting is good?


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