Author Archive for: Alex - Chart Freak

Many times we hear about buying the pullback, but when the pullback comes, it may be too intimidating to pull the trigger. Did you do any buying yesterday? Lets review the market action and also  discuss "Pulling The Trigger".

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SPX - The Spx has turned back down at resistance and has been rejected at the 10sma too. Wednesday the markets reversed back up to the 10 sma. This time it may be able to push higher.

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This report will be a report on the statistics of what was reported on in the weekend report...

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I wanted to post tonight because the action today was excellent.  I think we may be getting  the FAT PITCH that traders wait for all year. Lets take a look...

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According to Tom Petty,  "The waiting is the hardest part".   I do believe he's right, but at times it is the safest thing to do.  For example, did you see the futures yesterday in the morning? The Dow was set to open up hundreds of points higher and in fact, most of the day the Dow was up 300+ points. We were putting in a very nice bounce and suddenly going into the close the Dow sold off and closed down 2o4 points.  The S&P and NASDAQ did the same thing.  Lets take a look.

DJIA - Both Monday and Tuesday if traders entered the markets during the rally, they were stopped out or seeing red by the close.  Today the Futures are up big again. 

 The markets are very oversold.  I expect a bounce up to the major moving averages, but that may actually be a shorting opportunity. Now If you look at the Dow this way, you can see that several  more days like we just saw and you could make the case for the formation of a bear flag, wearing off oversold conditions.

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We were not long the markets over the weekend, but if you woke up Monday and you were?  The above picture is a perfect example of what that probably felt like. Dow futures were down hundreds of points and there was no escaping the bear claws.  We expected a drop, but I was very surprised at just how fast and  deep things unraveled.

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There will be a bounce, notice on the left side of this chart that even in Bear market sell offs, there are bear market rallies.  Pretty big ones.  We want to watch how that unfolds, as mentioned in the weekend report.

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