Sunday, December 19, 2010

Some of it.

SPX made a HH and HL  and spx closed in the plus column that is positive   Range was only 6 points.  SPX made the low of the day a few minutes before 8 and high of the day at few minutes before 11.  It then lost 50% of today's low to high by 12.45.  A small rally into close put spx in the plus column.  It was a lackluster day.  For the week the high of week came on Monday at 12 and low of the week on Thursday at 7. It was an options week.  

The two charts are of FAS.  On the left is hourly.  It tracks the retracement from the recent highs.  After dropping nearly 38% it has rallied to 25% I don't think we are out of the trouble yet.  Until it clearly busts thru the DOMA and the 12.5% at 26.56 the current rally may be just a counter to the drop.  On a longer term the chart on the right is daily.  44.1% ( 1/2 of 88.2%) is proving out to be a tough resistance.  Here too unless we break thru the 50% at 28.6 and above the top line FAS would be considered still not in a bull trend.  However the chart pattern is bullish.  There has been a decline 40 to 17 and an accumulation for 3 months from 7/1 to 10/1 the next stage is rally followed by distribution.  Another important issue is banks and FAS are no where near new highs while the rest of the markets are at new highs  that is bothersome.  I want to be bullish on FAS but I do not have all the i's dotted and t's crossed yet. 
The chart on left is TNA daily.  TNA is on the median line of the uptrending channel I believe this line will be broken and TNA would proceed to the top line of channel. It is at 87 or slightly higher.  I find it hard to look at this chart and say that the rally is over or to say we are going to fall apart.  Should TNA proceed to the top line of the channel the current 72 level will become a strong support.  It will be a major concern only if the bottom of the channel is pierced.  The blue green chart on left is RUT daily.  What is worthwhile noting is while RUT has made higher high than the one on April 26th at 745 TNA hasn't.  That is the price erosion in 3fer ETFs.  It amounts to $10 in 7 months on a $72 ETF.  My sense is TNA has some catching up to do. 
The table on the left is monthly open, Hi, Low and close of TNA.  I have marked on the table cells in reverse color (blue fill with white letters) to mark which came first hi or the low.  Yellow fills are intermediate highs and lows.  Its some thing I keep. Make it easy to anticipate whats next.  Last was a 31.5 low the next coming up is a high.  Not a trading tool something that tells me TNA is due a high soon. TNA also shows more than $10 range in every and some very big months of $25 or more.  I only need some of it.
On the right is Gann emblem.  With July 1st low this chart shows a 180 degree day coming up on Dec 31st.  The 180 is IMO a very critical point lots of turns have happened here.  I would be watching it and paying attention to it. 
All in all I am not bearish.  This rally has few more steps to do before the dance is over.  I will continue to play the long side. 
Thanks for reading my blog and offering your encouragement.

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