Charts I’m Watching: March 5, 2012

UPDATE:  3:15 PM

SPX attempting a comeback.   Could be nothing more than a back test on the small H&S; pattern just completed that indicates 1352 to the downside.

I’m watching the 30 and 60-minute RSI’s for signs that it’s more than just that.

The daily RSI is still looking quite bearish, having broken the yellow TL.  However, the purple line awaits.


Building on short positions…

Added 300 SDS @ 16.24
225 UUP @ 22.12
-125 EUO @ 19.39

ISM Services survey results out…read the entire report here.  Overall positive, except for slowing employment and rising prices — which will be seen as problematic in a market addicted to QE.

SPX has finally joining the party — making what looks like a definitive break from the rising wedge and reaction off the 1.618 Fib level of the Butterfly and .786 of the big Gartley patterns.

We’ve seen a clean break of the SMA 10 and a test of the SMA 20 coming up at 1358.04.  The EMA 3 is about to cross the SMA 10, which would be further sign of a trend change.

The daily RSI appears to have broken its trend line.  The hourly definitely has.

RUT continues to show weakness.  Recall that it already broke down from its rising wedge and its RSI TL on Feb 29.  The SMA 50 is just ahead at 792.72.

VIX showing strength, up over 8% this morning.  Note how the RSI has obeyed the rising TL as we suspected it would.

We can see a completed IH&S; pattern and a clean RSI TL break on the 60-min chart.  The IH&S; pattern points to 21.38 in the near run.

I’m going to load a 5% position in TVIX — buying 300 shares here at 16.55.

Here’s a snapshot of the current positions in the model portfolio, showing prices as of mid-day.  We are still in 64% cash, as I’d like to see more downside momentum (moving averages broken, MACD’s turn negative, etc.) before adding to our current shorts.


Charts I’m Watching: March 5, 2012 — 3 Comments

  1.  MMM broke the rising wedge a few days ago, not to mention the daily RSI trend line.  I would imagine we get at least a back test, but looks bearish from here – particularly if we get a bearish DI cross and the SMA 10 crosses the 20 — which will happen tomorrow unless we see a big rally.

  2. Looks like you had a pretty good day PW.

    So my crystal ball says we are about to retrace this year (I really thought today was going to be a big down day) – that let's us start feeling good again early summer – and build to a crescendo (up) for the elections. (It's my MMM leads the way perspective 🙂 ).

  3.  Thanks, AR.  Appreciate the heads up on HO.  Did we get to the magic number today?  For those of you who don't follow it, the Hindenberg Omen is one of those game changer indicators that Albertarocks has developed a particular expertise around.  Check it out.  And, AR, please drop in more often.  The door's always open.