Friday, August 2, 2013

ImageImageThe lack of volatility after non-farm payrolls missing their estimates is sending the message the stock indices are not ready for a take down just yet. On the 4 hour S&P 500 (SPX) chart, TD Sequential is indicating something will happen late Monday, or early Tuesday. The daily SPX is also signaling one or two days away from price exhaustion if all goes well with TD Sell Combo and TD Sell Countdown. The weekly SPX will record a 13 count TD Sell Countdown at the close. It is coming together and signaling a contrarian play. ImageImageImageImageThere is a mismatch on the weekly indices. With the SPX contributing to a 13 today and the Dow Industrials (DJI) recording a 13 two weeks ago, the Nasdaq Composite (COMPQ) and the Russell 2000 (RUT) are in the middle of the road. Both the Nasdaq and the RUT are on bar 5 of their weekly counts for TD Sell Setup. My idea is to allow a potential reversal on the SPX take place and see if it is good enough to break the COMPQ and RUT weekly continuity. 

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Was hoping for more of a capitulation rally but it did not follow through today. Sentiment wise, the declining VIX is showing complacency. Bullish now to the close but looking to get bearish next Monday or Tuesday and see if a downside trigger surfaces. (updated intraday) 

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2 Responses to Friday, August 2, 2013

  1. Wallfly says:

    Art, regarding the mismatches of Combo/Sequential on the several indices, try using the 2 Day instead of one. I think you’ll find the differences melting away quickly — we’re just about there. The advantage of using the 2 Day is that it gets you away from the focus that I suspect the HFT’s and algos too happily key on. I swear, it seems like every time the Daily strikes a 13 the algos make full certain they rip the hell off the Risk Level. It’s a bit like you using the 4 hour to get away from the more common time frames. Anyway, great site. Hope you’re having fun with it. :))

    • Art says:

      That helps with the alignment. So with the 2 hr, the window is this week or the next. Yep. We’re just about there.

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