Saturday, July 25, 2009

Index Intermediate Levels to Watch. ($NDX is the Leader)

Short term: no clue.

And I am not trying to guess it either. (100% cash for short term trading)

I did purchase a few DUG aug 17 calls @ .90 on Thurs PM, only to sell them all right back Friday AM @ .90. After contemplating and thinking it....XOM reports this coming week, and as the biggest portion of DUG, I seriously doubt they sell off XOM running into the earnings. Even the stocks that have reported bad numbers this season still ran up "into" the earnings. (amzn, msft, etc). So no reason to fight the prior established tape trend here to me.

Short term charts (60 min and almost the daily's are screaming "overbought"), but we have seen how long that can last both up and down.

It still "feels like" to me they are about to pull the rug from underneath this market and leave all the retails holding the bag here. But the tape on Friday sure to me did NOT suggest that is ready to happen yet. I mean all the signs "seemed to be there".
a)msft and amzn had terrible numbers and both sold off.
b)typically Friday after a HUGE up week is normally profit taking
However as the day went on, bullish strength was built up later towards the close, which is NOT indicative of end of the week profit taking at all. When volume is anemic thin, it is usually bullish more so than bearish. (as we also saw in late Dec as well)

Which is why to me, short term: NO CLUE

I know most people follow the COMP (more than the NDX), however the NDX is the real leader. Remember that NDX was the ONLY index that made a "higher low" in March.

We still do NOT have neg divergence yet on the weekly charts, that would be something bearish, when it does finally comes, but it actually has not yet.

So here are just some longer term FIB retracement levels to watch.
If they do break the 1st level, (to me, intermediate term), It could be a sign then are headed to the 2nd levels/targets.

Again, I have NO CLUE short term.

Although I do strongly feel that the $NDX is going to be the best signal here and should be watched the closest, as it is by far been the huge leader here for the entire market. (which is why I also included the $NDX monthly chart)

$XII: 480, 495
$SPX: 994, 1014 (as well as the psychological "1000")
$INDU: 9200, 9422
$NDX: 1615, 1629
$RUT: 553, 599
$COMP: 2012, 2063 (as well as the psychological "2000")
$VIX: 22.79, 19.00 (if 22.79: the 200ma weekly does not hold here, it looks like it could very well continue down in it's current wedge until the wedge completely runs out of room, which would be at around 19.00est, which is also the same low from Sept)

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