Tuesday, September 30, 2014

Bulls Beware

There is "something" that seems a bit off with this Market. I don't like the lack of new leaders, and the way the market had hit new highs and then retreated. I am also not impressed with the McClellan Oscillator and the Summation Index from a bullish perspective. What bothers me the most is how the VIX is in bearish territory.

The chart below is the S&P 500 and the VIX with 50-1 Bollinger Band settings, which was shown to me by Tom McClellan. When the VIX is above it upper Bollinger Band, the Market gets quite ugly. Take note on the chart below, the VIX is currently above its upper Bollinger band (highlighted with black rectangles). As a result, the VIX has wrecked havoc on the all Market indexes. When this occurs the Bears are clearly in charge. 

Until the VIX retreats below the middle Bollinger Band, consider this market in the bears hands.

Tuesday, August 19, 2014

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Tuesday, August 12, 2014

Will This Bullish Pattern Repeat?

This Market has been very difficult for many traders and investors out there the last year. Last week, I talked about how the Market is likely to bounce strongly. Fortunately, the Market did bounce strongly the following day. However, the VIX continues to be quite problematic, giving the bears control of this Market.

The good news is this Market is pretty strong, considering the geopolitical events happening across the world. However, the bad news is it does seem that this Market is at the mercy of the turmoil around the world. The bulls will not have it easy, until these global events are solved. At the same time, its worth noting the bears haven't done that much damage.

The chart below is the Summation Index (NYSI), a very accurate long term indicator. This indicator spent an impressive amount of time above 500 from February to July. This indicates with high probability the Markets will likely make new highs within the next 6+ months (due to spending so much time above 500). So in other words, its likely we will see the S&P 500 hit 2000 sometime this year

Sunday, August 10, 2014

Make No Mistake Bears Are Still In Control

The chart below is the S&P 500 and the VIX with 50-1 Bollinger Band settings, which was shown to me by Tom McClellan. When the VIX is above it upper Bollinger Band, the Market gets quite ugly. Take note on the chart below, the VIX is  currently above its upper Bollinger band (highlighted with black rectangles). As a result, the VIX has wrecked havoc on the all Market indexes. When this occurs the Bears are clearly in charge. Unfortunately, despite the Market's strong bounce on Friday, the VIX did not retreat below its upper Bollinger Band. 

On Thursday, I talked about the Market bouncing strongly, and that's exactly what happened. I continue to be of the belief that we are forming a very important bottom. However, until the VIX goes below its middle Bollinger Band, the bears are clearly in charge and the Market at the very least will be choppy. The reality is, the VIX is at the mercy of several global political issues that possibly need to be solved. In summary, Bulls need to hope for a collapse in the VIX.