Sunday, April 27, 2014

It's Still 70 - 30

Needs to be updated for recent trades
Indices Long Term Current and Past Portfolios


SPX tried hard to get through the 1870-1890 resistance band last week, but by Friday it gave up, sold off, tested its 20 D-SMA and closed slightly above it.
 
Under the most bullish scenario (shown in green, 70%), the sell off  last week has put in place the right shoulder for a sizable inverse head and shoulders pattern.  After a minor sell off on Monday and a successful test of 50 D-SMA, SPX rallies through its immediate resistance band to reach new all time highs by Thursday or Friday.

Under the most bearish scenario (shown in red, 30%), after an unsuccessful attempt to punch through resistance at 1870, selling picks up momentum and continues to test 100 D-SMA, recent low (1814) and PUL for SPX around 1800.  A weekly close below PUL would be game changer and would signal a high probability of significant selling ahead.
 

Disclaimer: The views expressed are provided for information purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.
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Saturday, April 19, 2014

SPX Is Getting Ready For Another New All Time High?

Needs to be updated for recent trades

Indices Long Term Current and Past Portfolios

As expected all major indices rallied significantly last week.  On Wednesday SPX bulldozed through its PDL, continued its rally on Thursday and closed just below its resistance band (highlighted in orange).  Getting through that band is not going to be easy.  There certainly will be at least one or two unsuccessful attempts early this coming week.  Chances are good that SPX gaps up on Monday into the resistance band, then sells off to back test its 20 and possibly 50 D-SMA's. 

Under the most bullish scenario (shown in green, 70%), the sell off early in the week, would put in place the right shoulder for a sizable inverse head and shoulders pattern.  A rally after the sell off and a close above the neckline (SPX 1780) of that Inverse H&S, would signal a powerful advance to SPX 1925 by late April.

Under the most bearish scenario (shown in red, 30%), the sell early in the week picks up momentum and continues to PUL to retest recent lows.
 

Disclaimer: The views expressed are provided for information purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.
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Sunday, April 13, 2014

Indices Are Oversold

RTS is selling SNDK and buying EXC in its place on Monday 4/14/2014 near the open.
My plan is to buy EXC, but wait on selling SNDK to see if SPX rallies back to its PDL.

Indices Long Term Current and Past Portfolios

It was an ugly week for bulls, but I believe we are at or near the bottom of current selling leg.  There is a good chance that we see more selling tomorrow to test Primary Uptrend Line (PUL) for SPX around 1810 and possibly an intraday panic to slightly below 1800.  After that, SPX very likely rallies to test  its new Primary Downtrend Line and back test its 50 D-SMA around 1840.

The level of "doom and gloom" noise is at extreme high now which in itself is a good sign for bulls.  It's always easy to come up with some idiotic doomsday prediction (without specifying any date for that prediction, of course) and disappear, then to reappear at some point in the future only if that prediction comes true to brag and shout "I told you so".

From a macro point of view, nothing has really changed.  Central banks are very accommodating and have stated that they would step in aggressively to stimulate growth if needed.  Inflation is in check.   US economy is growing at a healthy rate of 3%.  If earnings and forecast continue to be good, chances are good that indices rally back to set new highs.

At this point I believe there is one event that could send our economy into a deep recession and bring about a mutli-year bear market.  That event is a victory by Reps in November mid-term election to gain majority in both houses of Congress.  In that case, we would see the House starting an impeachment process.  We might also see another attempt at shutting down the government and even defaulting on national debt.  More on that later.
 

Disclaimer: The views expressed are provided for information purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.
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Wednesday, April 9, 2014

RTS Portfolios Are All Update Finally :)



Disclaimer: The views expressed are provided for information purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.
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Sunday, April 6, 2014

Tough Week Is Ahead For Bulls



SPX found support on its Active Uptrend Line and 20 D-SMA last Friday.  A close below AUL tomorrow would signal a test of 50 and possibly 100 D-SMA this coming week.   There is a good chance, however, that after a quick sell off early Monday, SPX rallies to test overhead resistance at its recent new all time highs. 


Disclaimer: The views expressed are provided for information purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.
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