A very nice week in the market for change after the pounding it has been taken over the course of November. You would only expect that after the enormous run up we had Wednesday that Thursday and Friday that sellers would re-appear and takes some profits. Thursday was basically a non-event, but Friday after the first hour of trading was over, the rest of the day it was a steady pace of selling all the way to the close. Look at my 1 minute chart of the S&P 500 chart below and you will see the selling that I speak of.
So what will next week bring? Have you heard this before? I have no idea, so I guess I need to stop saying it. What we need to happen is for price to continue up though $1267 which will be just a bit higher than the lower pivot High, which is the last Red H on the chart. If we can get above that before price reverse down, that would be the first indication that maybe this newest uptrend will continue. Second thing to point out is the that purple downtrend line looks like we broke through, but we really didn’t. If you look closely at the closing prices, the little white ticks sticking out to the right of each price bar, closed right on the purple down trend line. So we need to continue up another 19 points on the S&P 500. Take a look at the chart with my markings on the chart below.
I wish I felt confident that this market was going to continue up, but it just seems that since July 25 that just the slightest bad or good news can swing the market 2-3% in a day. It is very hard to stomach these types of markets and if anyone claims and brags about how well they played it, shrug it off as banter until they will show you their bottom line in a printed statement. 99% of those braggers will disappear once they hear that request. I know one at work and I heard it over and over again but not once in 2 years have seen a printed statement so I just smile and listen.
Our last Pivot low that we enter on once it was confirmed last Monday is still in play and still working. If it turns south we need price to close everyday above 1158 until it starts back uphill and we will be good. If the Dow30, Nasdaq, and Small Cap are confirmation signals for the S&P500, they are doing a good job for us. We need them all to go up, break out, and break resistance levels. All are looking good and on track at the moment. All of the indexes sold off Friday, so let’s just hope that was just a little profit taking.
$1.17, that is what we really, really need out of the EFA or International Fund. What would help our markets to continue higher is for the EFA to stop the current down trend that has been running since May 2, 2011 stat a new uptrend. Look how bad it is, last week the EFA was up close to 12% and but needs another 12% just to break even for the year. If it would just start making Higher High’s, maybe our markets would start stabilizing and stop these wild swings. Be careful if you have money in EFA or I-fund because even though that was the same pivot low we took in the S and C fund, our markets have not been as weak. Below is that chart so you can see the distress and what need to done.
I have nothing new to say about the up coming week that would make you want to move money, but I will be watching closely given that we slowed Thursday and Friday. So Monday is a do nothing day and I will watch.
TSP Distribution: C-fund 50%, S-fund 50%
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