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johnpaulca
11,312 posts
msg #93953
Ignore johnpaulca
6/17/2010 10:30:43 AM

Relevant information about today's market. Feel free to add your 2 cents.

johnpaulca
11,312 posts
msg #93954
Ignore johnpaulca
6/17/2010 10:31:10 AM

9 major U.S. stock sectors ranked in order of long-term relative strength:

Consumer Discretionary (XLY) Bullish, Overweight. The Relative Strength Ratio (XLY/SPY) rose above 12-year highs on 5/27/10 and remains bullish. Absolute price of XLY has remained above its 200-day SMA consistently since 2/23/09. Support 30.34. Resistance 34.39, 36.13, 38.25 and 39.09.

Industrial (XLI) Neutral, Market Weight. The Relative Strength Ratio (XLI/SPY) remains neutral, according to the 50/200 trend-following moving average system. Absolute price of XLI rose above its 200-day SMA on 6/10/10 and has continued to trend higher. Support 27.40. Resistance 32.41, 33.46, 34.24, 34.50, and 35.00.

Technology (XLK) Neutral, Market Weight. The Relative Strength Ratio (XLK/SPY) remains neutral. Absolute price of XLK rose above its 200-day SMA on 6/15/10. Support 20.64. Resistance 23.27, 24.16, 24.68, and 25.69.

Consumer Staples (XLP) Neutral, Market Weight. The Relative Strength Ratio (XLP/SPY) has performed about in-line with the broader market for the past 7-months and remains neutral. Absolute price of XLP rose above its 200-day SMA on 6/15/10. Support 25.78 and 24.95. Resistance 27.83, 27.95, 28.20, 28.75, 29.29 and 30.29.

Utilities (XLU) Neutral, Market Weight. The Relative Strength Ratio (XLU/SPY) moved above 4-month highs and its 200-day SMA on 6/16/10. The RS Ratio remains neutral because the 50-day is still below the 200-day SMA. Absolute price of XLU rose above 50- and 200-day SMAs on 6/15/10, although the 50 remains below the 200 SMA. Support 27.44, 25.76. Resistance 30.59, 30.91, 31.64 and 32.08.

Health Care (XLV) Neutral, Market Weight. The Relative Strength Ratio (XLV/SPY) remains neutral. Absolute price of XLV firmed up since breaking down below 6-month lows on 5/25/10. Still, price is technically bearish because price is below both SMAs and the 50 is below the 200 SMA. Support 27.96. Resistance 30.83, 32.05, 32.18, 32.42, 32.69, 33.16, 33.37 and 33.74.

Energy (XLE) Neutral, Market Weight. The Relative Strength Ratio (XLE/SPY) rose above its 50-day SMA on 6/15/10 and so turned neutral. Absolute price of XLE rose toward but remains below 50- and 200-day SMAs. Support 50.15 Resistance 58.11, 59.84, 62.30, 62.73, 69.95, and 78.10.

Financial (XLF) Neutral, Market Weight. The Relative Strength Ratio (XLF/SPY) and the absolute price of XLF both remain neutral. Support 13.70 and 13.51. Resistance 15.67, 16.13, 16.90, 17.12, 17.16, and 17.87.

Materials (XLB) Neutral, Market Weight. The Relative Strength Ratio (XLB/SPY) fell below 14-month lows on 6/7/10 and remains bearish. Absolute price of XLB has bounced since falling below 9-month lows on 6/8/10 and remains neutral. Support 28.55. Resistance 33.06, 35.47, and 37.56.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) rose above its 50-day SMA on 6/10/10 and so turned neutral. Absolute price of EEM also is neutral.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) rose above its 50-day SMA on 6/15/10 and so turned neutral. Absolute price of EFA fell below 10-month lows on 5/25/10 and remains bearish.

NASDAQ 100/S&P 500 Relative Strength Ratio moved further above 50- and 200-day SMAs on 6/15/10 and remains bullish. The RS Ratio rose above 9-year highs on 6/4/10, giving a major bullish signal.

NASDAQ Composite/S&P 500 Relative Strength Ratio rose above its 50-day SMA on 6/15/10, turning bullish again. Absolute price of the NASDAQ rose further above its 200 SMA on 6/15/10 and remains neutral.

Russell 1000 Value ETF Relative Strength Ratio (IWD/SPY) remains neutral. Absolute price of IWD rose above its 200-day SMA on 6/15/10 and is now neutral.

Growth Stock/Value Stock Relative Strength Ratio (IWF/IWD) rose above 3-month highs on 6/7/10 and remains neutral. Absolute price of IWF rose above its 200-day SMA on 6/15/10 and is now neutral.

The S&P 500 Equally Weighted ETF Relative Strength Ratio (RSP/SPY) rose above 7-year highs on 6/15/10 and remains bullish. Absolute price of RSP closed above its 200 SMA on 6/10/10 and remains neutral.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) fell below the lows of the previous 30 years on 6/15/10 and remains bearish. Big caps have been out of favor for more than 10 years, since 3/29/2000.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) remains neutral. Absolute price of IWM closed above its 200 SMA on 6/10/10 and remains neutral.

The S&P MidCap 400/Large Cap Relative Strength Ratio (MDY/SPY) rose above its 50-day SMA on 6/10/10 and so turned bullish. Absolute price of MDY closed above its 200 SMA on 6/10/10 and remains neutral.

Crude Oil nearest futures contract price rose up above 4-week highs on 6/16/10, thereby confirming a short-term uptrend. Ascending Triangle bottom allows an objective above 80. Support 69.51, 67.15, 65.05, and 64.24. Resistance 77.74, 78.81, 81.29, 87.15, 90.51, 98.65, and 102.84.

Gold nearest futures contract price rose above its all-time high at 1249.7 set on 6/8/10. The main trend remains bullish. Support 1196.9, 1168.0, 1156.2, 1124.3, 1084.8, 1045.2, 1026.9 and 989.3. Resistance: none.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) remains technically bearish, with the Ratio below both SMAs and the 50 below the 200 SMA.

Silver/Gold Ratio turned bearish on 5/17/10 when it crossed below both 50- and 200-day SMAs, with the 50-day SMA below the 200-day SMA.

Copper nearest futures price has bounced since breaking down to a new 7-month low of 2.72 on 6/7/10 but may remain in a downtrend. Strength in Copper suggests renewed hope about prospects for the world economy, while weakness suggests doubts. Support 2.72. Resistance 3.187, 3.2675, 3.3225, 3.795 and 4.27.

U.S. Treasury Bond nearest futures contract price has lost upside momentum since setting a 14-month high at 126.05 on 5/2510, which reflected a flight to safety, a flight that may have landed weeks ago. Support 121.06, 119.26, 118.24, 118.12, 115.15, 114.06. 113.04, and 112.15. Resistance 126.05, 126.15, and 130.31.

Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) has been moving with the stock market and remains neutral.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below 6-month lows on 5/20/10 but still remains neutral for the intermediate-term trend. This implies that investors are choosing somewhat less inflation protection. Absolute price of TIP remains bullish.

The U.S. dollar nearest futures contract price broke down below 3-week lows on 6/15/10, confirming the short-term sell signal on 6/14/10. Support 85.325, 83.07, 81.74, 80.14, 79.73, 79.61, 78.83, 78.20, 76.74 and 75.90. Resistance 89.22, 89.71, and 92.53.

The Art of Contrary Thinking: The various surveys of investor sentiment are best considered as background factors. The majority of investors can be right for a long time before a major trend finally changes course. The Art of Contrary Thinking is best used together with more precise market timing tools.

Advisory Service Sentiment: There were 37.0% Bulls versus 32.6% Bears as of 6/16/10, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear ratio fell to 1.14, down from 1.21 the previous week. The current Bull/Bear ratio has fallen substantially from its peak at 3.36 set on 1/13/10, which was the highest bullish sentiment in 6 years. The 20-year range is 0.41 to 3.74, the median is 1.51, and the mean is 1.57.

VIX Fear Index fell to the mid 20s since peaking at 48.20 on 5/21/10. A falling VIX suggests decreasing bearish sentiment. VIX is a market estimate of expected constant 30-day volatility, calculated by weighting S&P 500 Index CBOE option bid/ask quotes spanning a wide range of strike prices for the two nearest expiration dates.

VXN Fear Index fell to the mid 20s since peaking at 48.89 on 5/21/10. A falling VXN suggests decreasing bearish sentiment. VXN measures NASDAQ Volatility using a method comparable to that used for VIX.

ISEE Call/Put Ratio fell to .059 on 5/7/10, a low level that indicates bearish sentiment. Its 2-year mean is 1.20, and its typical range is 0.69 to 1.71, which represents two standard deviations from the mean.

CBOE Put/Call Ratio rose to 0.96 on 5/20/10, its highest level of the year. A high level indicates bearish sentiment. The 2-year mean is 0.70, and the typical range is 0.44 to 0.96, which represents two standard deviations from the mean.

The Dow Theory again confirmed a Bullish Major Trend on 4/26/10, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 18 months. The Dow Theory signaled the current Primary Tide Bull Market on 7/23/09, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 6 months. That 7/23/09 bullish signal reversed the previous bearish signal: the two Averages signaled a Primary Tide Bear Market on 11/21/07, when both Averages closed below their closing price lows of August 2007.

S&P 500 Composite (SPX) broke out above resistance to its highest level in nearly 4 weeks and closed above its 200-day SMA on 6/15/10. The recent Double Bottom near 1040 allows an upside projection above 1160. Over the past 3 weeks, SPX reached down into deeply oversold territory and previous support, testing and holding year 2010 extreme intraday lows around 1040 several times. I expected an oversold rally, and it appears to have begun. Support 1040.78, 1029.38, 1019.95, 1012.42, and 1008.55. Resistance 1130.29, 1151.41, 1173.57, 1181.49, 1219.80, 1220.03, and 1228.74.



heypa
283 posts
msg #93959
Ignore heypa
6/17/2010 11:33:58 AM

Information overload. IMHO

johnpaulca
11,312 posts
msg #93960
Ignore johnpaulca
6/17/2010 11:56:23 AM

Agreed...ya gotta take all this noise with a grain of salt.

Kevin_in_GA
4,550 posts
msg #93963
Ignore Kevin_in_GA
6/17/2010 12:42:27 PM

Where are you getting that overview? Interesting stuff (I always look at relative strength nowadays).

johnpaulca
11,312 posts
msg #93964
Ignore johnpaulca
6/17/2010 12:46:53 PM

TraderPlanet.com

johnpaulca
11,312 posts
msg #93966
Ignore johnpaulca
6/17/2010 1:14:42 PM

On the NYSE yesterday Up Volume made up nearly 96% of all volume. This was the 2nd 90% up day in the last week (the other being last Thursday). I've shown before that this setup, while rare, has led to some extremely bullish returns.

Image and video hosting by TinyPic

So while instances are low, returns have been very explosive. The results over the 1st few days are choppy - likely thanks to the fact that the 2nd 90% day will normally put the market in an overbought position. Once you get out over a week, the upside overwhelms.

Source: Rob Hanna

jrbikes
624 posts
msg #93967
Ignore jrbikes
6/17/2010 1:33:44 PM

overall the market seems nuetral, with that exception of a explosive day here and there, you can see it in the charts, most are at some resistance point, and the indecision is becoming evident!

johnpaulca
11,312 posts
msg #94082
Ignore johnpaulca
6/20/2010 9:09:25 AM

5 Uncommon Rules of Wealthy Traders


Over the past year I've spoken to hundreds of traders, many of which were recorded and posted at TraderInterviews.com. If you had asked me a few years ago how the best traders approached the markets, I would have said that they all had similar strategies. But after talking with traders of every market imaginable, I've found they all have very different methods.

However, while they each may use wildly different techniques (I spoke with one very wealthy trader who confirmed his chart patterns by looking at planetary movement and moon phases), all of them follow five rules without exception. Some of them make hundreds of thousands - even millions - of dollars each trading their own account. These aren't your typical "always use a hard stop loss" type of rules . These are actual guidelines successful traders follow religiously.

In fact, I'd bet that deep down you know you should be following these rules as well but you aren't - yet. Today is the day you can commit to doing what works for other wealthy traders and get on that same path.

Let's get started.

1. They plan every single trade. EVERY SINGLE ONE.

Every trader I've talked with that makes money consistently knows the following about every single trade they take before they even begin entering a limit order into their trading platform:

a) the highest price they are willing to pay (if they are going long) or the lowest price at which they are willing to sell (if they are going short)
b) their profit target where they will exit if they are "right"
c) their stop loss where they will exit if they are "wrong"
d) the risk/reward ratio of the trade
e) the exact percentage of their account they are risking

Lots of traders do one or two of these things. Few do all of them. In simple terms they know exactly what they want to pay, how much money they anticipate making (or losing) and a very clear idea on the probability of the trade working out.

Although you might think that every great trader uses hard stops that are pre-programmed in, many don't . However, they are highly disciplined and when their stop loss number comes up they are out. Most traders don't have that type of hard-core discipline and so a hard stop loss is still their best option.

2. They stopped trying to pick tops and bottoms years ago

Nearly all of the classes, courses and webinars you'll find on the Internet talk about using support and resistance of some type to find where a market is turning and how to get in before or while it does.

The funny thing is that only a very few successful traders I have ever talked to trade that way. Simply put, 95% of the traders out there that make money are buying higher highs and selling lower lows. They do the exact opposite of nearly everyone out there because they found out long ago that picking tops and bottoms is a sucker's bet. One trader described it to me by saying that it's much easier to just participate in what a market is already doing than trying to guess when that behavior will change. Flip-flop your strategy to agree with what the market is doing rather than guessing on when it will change its mind, and you'll be in a much better position to make money trading.

3. They are patient with winners - and ridiculously impatient with losers.
Dennis Gartman is famous for boiling down great trading to one thing: "Do more of what is working and less of what isn't." Sure makes a lot of sense to me.

Most traders have a great deal of patience with their losers but get nervous about locking in gains and sell them to quickly - the exact opposite of what wealthy traders do. Wealthy traders realize that they may actually have more losing trades than winning trades so they quickly get out when they are wrong. It is the only way to ensure that they can give their winners the attention they deserve.

They coddle their winners and kick their losers to the curb without a second thought.

4. They trade one market. ONE

I've talked with great traders who can trade futures, forex and stocks at the same time. They are a gifted tiny minority.

The vast majority of successful traders concentrate on one market and become so comfortable with it that they begin to "know" the behavior of that market just watching price and volume. Test yourself - if you aren't able to get rid of all your charts and simply look at price and volume to trade, you're probably not concentrating enough on one market in order to know its moods. What we're really talking about here, of course, is not the mood of the market itself but the moods of the market participants!

Focus on trading one market exceptionally well rather than try to trade whatever's hot - that's how wealthy traders do it.

5. Their benchmark for success is anything but money

Money changes everything. It sure does. We're all in this to make money. The trouble is, when traders use the amount of money they make to judge their own success, something happens to them - to all of us, really - that clouds our decision-making ability.

Wealthy traders have realized this and instead focus on other things to determine if they've had a successful day. Whether it be how well they were able to execute on their trading plan (see rule #1), or their overall ability to predict short-term movements in whatever they are trading, they know that if they do those things correctly, the money will follow.

Yes of course the money is important. Any trader who says otherwise is a fool. Why else would we put ourselves through this daily ride. But there is something about making it a secondary focus that allows the best traders to make better decisions. The growing trading account simply becomes a nice result - a side benefit if you will - of making good decisions and reading the market well.

Source: Tim Bourquin of TraderInterviews.com

miketranz
716 posts
msg #94084
Ignore miketranz
6/20/2010 11:04:35 AM

Gartman is on the right track.The only problem is,you have to find out what works for yourself.Nobody's going to show you how to trade successfully.You can write books on what does not work.Show me one that works.They were either written by someone who made money in a strong bull market or they're trying to sell you a bag of goods.I always said that the market itself will give you all the education you need,if you can hold out long enough & develop the competency to succeed......

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