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Wednesday, August 13, 2014

Daily update 8/13

Up and away some more.  Here is the daily SPX chart.

SPX closed above the 8/11 high and the price bar turned green today.  It sure looks like we are on the way to the 50 DMA.  Volume continues to be extremely light.  This should be enough to turn the short term trend up.  We will have to see what happens if we get to the 50 DMA.  Here is look at the futures chart.

The futures finally confirmed the break above the 200 SMA.  They have also managed to climb above the 50 SMA.  It is another 9 points up to the 100 SMA which would put SPX very near its 50 DMA.  That 100 could be stiff resistance as the 50 SMA has crossed below it.  This rally does not seem all the energetic to me so we will see what happens.

IWM did not get above its 8/11 high and is still below its 200 DMA.  SPY really struggled to get going today for some reason.  It was testing its intraday lows while many other indexes were making new intraday highs.  The Dow struggled also and ended the day showing relative weakness even to SPY.  The futures are up a bit after hours and we had a pretty long consolidation this afternoon so we might get a little more upside tomorrow morning.  This rally still seems a little precarious.  I think we need to continue taking it one day at a time.

Is Macy's a canary in the coal mine.  Check out this chart.

Macy's is the green line.  In 2000 and 2007 Macy's topped out a bit before DIA.  The 2002-03 low was a bit complex as Macy's bottomed way back in 2000.  The 2009 low shows Macy's bottoming in late 2008.  While it is too early to say Macy's has put in an important top the chart does show it breaking below a monthly double top similar to the double bottom it made in 2008-9.  Today's break down came on heavy volume after earnings.  Not necessarily the kiss of death as there might not be any follow through.  However, I think it is worth watching.

Here is an interesting article on how micro cap stocks might be a good sign of risk appetite.  Watching Micro-caps to Gauge Risk-Appetite  I didn't even know the IWC ETF existed.  Check out this interesting chart.

We can see that IWC topped before DIA in 2007.  This is all the data there is for that ETF so we can't see the 2000 top.  The logic makes sense to me that this ETF would top earlier then the big cap indexes.  It is certainly in much worse shape then IWM and that is pretty bad.  This one already looks like it has completed a big top formation to me.  Isn't primary trend already down?

This is a nice look at the longer lasting stock market cycles I call secular bull and bear.  Study the red periods a bit and see if you notice anything different about the current one from all prior red periods.  I will mark the chart up tomorrow with what I think is a significant difference.


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