Wednesday, May 26, 2010

Not so boring ..when you make money

Today was not much different in the market than previous days.  SPX opened with a gap and quickly reached its top by 8.40 at 1090 and drifted lower to 1065 at 12.35.  Then it made a half attempt to go positive but closed at 1068 down 6.  FAS was a similar story top was 24.3 and bottom was 22.3 and closed at 22.6 down .35.  This kind of move makes a lot of people go bearish.  Late in day selling produces candles with long top wick and short bottom wick and relatively small body.  These are considered bearish.  FAS is solidly below DOMA on 60 min  and after briefly passing the DOMA on 30 min it is below the doma.  We made HH and HL on both and that leaves trend positive.  
The 2 charts above are SPX daily.  Chart -1 shows the 3 cycles of 85, 82 , 65 and current count of 76 days from respective lows.  Chart 2 is more focused on the decline.  We have completed 22 days of decline from 1220 and first top to top was 13 days and low to low as 12 days.  We  have 9 days since last top.  we may have 4 more days to go. Any thing over 80 days since last bottom is an area to watch for me to spot a  bottom.  We have spent 308 days since last March 6th low.  My sense is we need to burn some time off the calender to get all the counts to be in sync and then we would have a good bottom to trade from.  I am not that bearish DMRM and D2PL worked swell and I would be looking to pick up some change on bullish side.

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