Mid-Session Post: So Far Change in Trend, Not Reversal
As of now, an hour and a half into the trading day, the S&P has broken below the accelerated trendline. What does that mean in terms of, well anything? It means we have a CHANGE in the trend, but not a reversal. Not yet at least. A change in trend means that we can go from an uptrend to a sideways, trading range instead. Or we could just continue trading in an uptrend, but on less momentum than previously seen. It does not mean we are headed necessarily headed lower. We need to see lower lows and lower highs before we can be in an actual downtrend
I am watching the 1,629 to 1,633 area, which has held so far. If that level is breached and we get a close below there, I am expecting 1,600 to be the next support level. Notice in the chart below, if we do hit 1,600, depending on when, price could still be in the rising channel…uptrend. One day does not make a trend. It takes a lot of work to reverse a primary trend.
Lets see how this plays out. As always, follow me on StockTwits & Twitter to track all my posts in real time. If you’re not following me on there, you are missing out on about 95% of what I say. Blog posts take longer than 140 character posts.
BTW, if you’re underperforming the market today you really need to rethink your approach. You likely got too complacent, which is the most dangerous state to be in.
Written by: Karthik Sundaram
Will not be Posting a Market Analysis Post Tonight…Kind Of
I won’t be posting a regular Market Analysis post tonight because I want to see how the market reacts on Thursday and Friday before running a full analysis. As of right now today’s drop doesn’t mean all that much as one day does not make a trend. The next couple of days will definitely be telling.
With that being said, today’s drop should not be ignored as it was heavy volume reversal occurring in an extended market that has not seen a lower low close since May 1st.
Now for some charts:
S&P 500 another chart with more trendlines at the bottom of this list
Was less than 3 pts away from hitting my 1,690 target.
SDS (2x Leveraged S&P 500 Inverse ETF)
Highest Volume since August 2011, which was the beginning of the bottom. Traders/Investors really trying to get their hands on some leveraged shorts here.
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Written by: Karthik Sundaram
So Gold and Silver, huh?
Silver has been on a wild run as of late, and we witnessed one of the larger swings the metal has seen on Sunday Night into Monday. If you followed any of the other streams, i.e., StockTwits, Twitter, or Facebook, you would have seen me posting about how Silver Futures were down 8% at one point. It looked like an absolute collapse on the already battered commodity.
When the market opened on Monday SLV made back some of the losses overnight, but still opened lower. However, around noon Silver and SLV really took off, erasing all its losses for the day and went up as high as 8.1% from its lows.
Written by: Karthik Sundaram
Market Analysis- 05/19/2013
As the market continues to trek higher, the amount of ppl still doubting this market still amazes me. Every article I read still has the same level of skepticism in it as it did February, March, and April. The skeptics and shorts are continuing to help fuel this market higher. Every new high results in a new set of shorts covering. Once we run out of buyers, once the market can’t possibly go DOWN, once rationality gets thrown out the window and it seems like everyone is just longing anything to make a buck, that’s when this run is finished.
Until then enjoy the ride. As Josh Brown’s blog post is titled, “Remember This Moment”
I updated my S&P 500 chart with some new trendlines (in purple below), which I got the idea for from Kirkpatrick & Dahlquist’s book Technical Analysis: The Complete Resource for the Financial Market Technicians. There are more notes on the trendlines in the chart itself. Read More
Written by: Karthik Sundaram
Watchlist- 05/18/2013
Charts I’ll be keeping an eye on and have alerts set for, be sure to note that some of the charts are of daily and some are of weekly candlesticks. There is no need for you to follow & track each and every one of these charts below, but go through them and note which ones would best fit your strategy. Charts listed in alphabetical order:
AAPL (updated text, meant to write “100-day SMA”, not “50-day SMA”)
Bounced right off extended support as anticipated. Still in ‘no-man’s’ land currently, would like to see a higher peak, which would also mean a break above the 100-day SMA + 38.2% Retracement level. All add validity to break of prior peak.
ADSK
Potential short with break of neckline. Head-and-Shoulders.
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Written by: Karthik Sundaram
