Market commentary for 03/16/2009
Good day,
A little good news from the banks and retail and the markets jumped 10 percent. We waited several weeks to get this move. Let’s start with the weekly charts. Do you remember that I talked last week about CCI weekly setups and that is exactly what we got. Last week the CCI triggered and if we take a look at the weekly charts we can see the indices have more room for an upside move. I will look for the 20sma as target areas for the DIA and the SPY. That is general spot, but since we already have seen a daily exhaustion move what can we expect for new setups? The weekly charts say we picked the bottom which is always good and we took number of really great swing setups. Market was finally nice to us, but we must move on. Weekly charts say that indices have room for upside move and daily charts are very extended. Indices closed above daily 20sma which is a very good sign. After weakness in the morning the indices got back to the highs and without profit taking closed near those highs. With that in place the odds for future continuation and more upside are good. Now let’s look at the negative side. For a new setup we need to see consolidation on the daily charts. That means we want see one consolidation week before we see a new low risk swing setup. If that is the case next week, we want the daily 10sma hold. That is the last support for a good continuation. Volume on this bounce is not big and that is another negative factor. Volume decline is not good for a bounce. Third is the 60 min CCI divergence. We can see good odds for 3D CCI on the 60 min charts. Those are all reasons why I will be very cautious with any new long setups next week. Monday I think the indices have room for another upside move to second daily resistance line. Taking that possibility will be high risk and I will leave it alone. Tuesday will be the FED meeting. I don’t expect big news but you know that is always good to be cautious. Also next week is option expiration week. With good odds for consolidation week, Tuesday FED meeting and option week I think that is reasonable to expect one consolidation week with a much harder time for trading than last week. We must prepare for that. During consolidations trading risk is always higher and in those situations safest places for new setups are smaller time frames and faster trades. That will be my focus next week and of course if I will find “own way” chart I will swing it. After a move such as last week we can look for rest. We saw the move and we can wait for the rest start.
Those of you that used to come into the trading room and stopped, I want to tell you I am back full time and welcome all of you to come again. There is nothing to lose since there is no charge for the service right now. I look forward to seeing you all there.
Good day,
A little good news from the banks and retail and the markets jumped 10 percent. We waited several weeks to get this move. Let’s start with the weekly charts. Do you remember that I talked last week about CCI weekly setups and that is exactly what we got. Last week the CCI triggered and if we take a look at the weekly charts we can see the indices have more room for an upside move. I will look for the 20sma as target areas for the DIA and the SPY. That is general spot, but since we already have seen a daily exhaustion move what can we expect for new setups? The weekly charts say we picked the bottom which is always good and we took number of really great swing setups. Market was finally nice to us, but we must move on. Weekly charts say that indices have room for upside move and daily charts are very extended. Indices closed above daily 20sma which is a very good sign. After weakness in the morning the indices got back to the highs and without profit taking closed near those highs. With that in place the odds for future continuation and more upside are good. Now let’s look at the negative side. For a new setup we need to see consolidation on the daily charts. That means we want see one consolidation week before we see a new low risk swing setup. If that is the case next week, we want the daily 10sma hold. That is the last support for a good continuation. Volume on this bounce is not big and that is another negative factor. Volume decline is not good for a bounce. Third is the 60 min CCI divergence. We can see good odds for 3D CCI on the 60 min charts. Those are all reasons why I will be very cautious with any new long setups next week. Monday I think the indices have room for another upside move to second daily resistance line. Taking that possibility will be high risk and I will leave it alone. Tuesday will be the FED meeting. I don’t expect big news but you know that is always good to be cautious. Also next week is option expiration week. With good odds for consolidation week, Tuesday FED meeting and option week I think that is reasonable to expect one consolidation week with a much harder time for trading than last week. We must prepare for that. During consolidations trading risk is always higher and in those situations safest places for new setups are smaller time frames and faster trades. That will be my focus next week and of course if I will find “own way” chart I will swing it. After a move such as last week we can look for rest. We saw the move and we can wait for the rest start.
Those of you that used to come into the trading room and stopped, I want to tell you I am back full time and welcome all of you to come again. There is nothing to lose since there is no charge for the service right now. I look forward to seeing you all there.
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