Post by TradingForGod on Sept 22, 2004 18:35:05 GMT -5
Greetings from Tulsa, OK. I am up here working at my new job with an oil company. I am just here for the week and then will be back in beautiful Houston, TX. Because I don’t have access to all my charts at home I can’t produce a graph to attach to the discussion, but I did want to talk about the recent sell-off we have seen in equities. Remember from the last several global discussions, that I have been focused on the downtrend line off the Feb and Jun highs. The Dow was the first to test that line early this month and I thought it would be hard or impossible for the S&P and Nasdaq to do the same. But sure enough, the Dow stalled out at resistance and the S&P caught up and tested its trendline as well. BOTH TRENDLINES HELD. Thus this decent sell off.
Today, the Dow closed below its 40-day MA for the first time in a month. The S&P and Nasdaq are still above this key benchmark. Momentum is negative and stochastics are pointed lower and not nearly oversold. That’s pretty negative. On the other hand, MA structure remains positive, though not as much as it has been recently. In addition, the Dow is nearing the bottom of the BB range and the ADX trend indicator shows no trend at all (no surprise there). Putting it all together, I think that equities have a decent chance for some additional weakness in the short term. The S&P could fall back to 1100ish and the Nasdaq to 1840-1825. But I think that should stop the decline. If it doesn’t, something more bearish is going on here.
If you were smart enough to follow my advice (just kidding, I am not THAT conceited ) and liquidated length into trendline resistance a couple of weeks ago, the areas listed above should be good support to try and buy back in. Good luck to us all.
God bless,
TFG
Today, the Dow closed below its 40-day MA for the first time in a month. The S&P and Nasdaq are still above this key benchmark. Momentum is negative and stochastics are pointed lower and not nearly oversold. That’s pretty negative. On the other hand, MA structure remains positive, though not as much as it has been recently. In addition, the Dow is nearing the bottom of the BB range and the ADX trend indicator shows no trend at all (no surprise there). Putting it all together, I think that equities have a decent chance for some additional weakness in the short term. The S&P could fall back to 1100ish and the Nasdaq to 1840-1825. But I think that should stop the decline. If it doesn’t, something more bearish is going on here.
If you were smart enough to follow my advice (just kidding, I am not THAT conceited ) and liquidated length into trendline resistance a couple of weeks ago, the areas listed above should be good support to try and buy back in. Good luck to us all.
God bless,
TFG