the approaching moments of truth: spx

i have to apoligize to my faithful readers - for a couple reasons i have not been posting as much as i would like to... for one, i have been busy with a home renovation that has gone on too long and we are nearing the end and its coming along great but it has been eating up a lot of my time lately. on top of that, the markets have been strong, and i've been letting the charts "breathe" so to say in an attempt to gain some insight about what comes next. that being said, the markets and the charts have been showing strength, and not much out there impresses me in terms of shorting. i am not fighting the the trend, or lack of it, and have been focusing then on the house and my day job. this next week will be interesting. i have two charts of the SPX for us to look at.

this first chart is a longer term view of the SPX and a major trend line highlighted in blue. we've fallen below it for a second time now. retracing to this line and busting above with volume indicates strength and would suggest perhaps more upside for some time to come. a retrace on low volume with no busting through or a busting through accompanied by a subsequent breakdown may be an additional red flag signaling the making of a top for some longer duration beyond the short term. the red circle highlights our approach up the underside of the blue uptrend line.

below is a shorter term view of the SPX. the last candle pictured is the thursday before the easter holiday - the low volume makes sense. monday and the reaction to friday's strong job numbers will start the week out with a bang. the strong job numbers suggest economic strength - i am no economist, but i imagine that low unemployment is bullish for a consumer-driven economy; however, strong numbers won't inspire the fed to cut rates. tight labor markets aren't necessarily good for company profits. anyway, back to the charts. check'em out and let me know if you have any thoughts.

so far so good on QID

intraday post | the QID remains above the uptrend line that i pointed out a couple days ago...

ACI and the upcoming downtrend line test

it looks like ACI will soon be testing the underside of a relatively long term downtrend line. i don't know much about the fundamentals of this sector, but could spring/summer be a good time to short coal? who knows - i'll be keeping an eye on the chart, price and volume, moving averages and this downtrend line.

good time to watch QID

now seems like a good time to keep any eye on the QID. it has pulled back to the upside of the red downtrend line. it may or may not find support here. also, keep an eye on volume.

third circle to the rescue - HAL and the power of trend lines

intraday post

these two charts of HAL demonstrate the power of trend lines and trend line support. it's significant when these trend lines get broken - so keep monitoring this one. check out the volume for today so far, too!

HAL - longer term - third circle to the rescue!

HAL - shorter term

coloring the QID > more price and volume mechanics > trend lines > sup/resist lines

the volume trend and explosion alone are impressive... is there anything predictive going on here?

ESRX, trend lines and the mechanics of price and volume

price and volume can be very telling. keep in mind that any one day may or may not be meaningless in the grander scheme of things. its an ongoing, iterative, analytic process.

the significance of price and volume mechanics become more important as price approaches demonstrably significant trend lines, horizontal support/resistance lines and moving averages. for example consider the chart of ESRX below. the red circles highlight yesterday's candle and corresponding volume. note the high volume along with the failure of the price to break above the downtrend line or make any appreciable and significant movement, either up or down. yes, the stock closed down for the day, but the absolute change isn't great. this indicates large turnover of stock accompanied characterized by nearly balancing amounts of selling and buying. another word for this is distribution. sustained distribution over time or at key resistance levels is very bearish and helps to build the case for shorting. no back to ESRX - why such action here? there was news recently, but i don't follow that too hard. for better or worse, i prefer to listen to the charts - but that's just me. in all honesty, i am slacking in my ability to appreciate the fundamentals. at any rate, failure to break above or below the long term downtrend line will be significant - keep it on your radars!

ok, now back to charting... [to be updated throughout the day]

as i come accros good charts, i will be posting here, so check back throughout the day...

$VIX and the power of trend lines - i haven't looked at the $VIX in quite some time, but a while back i drew that red downtrend line before that final spike highlighted by the blue circle ever existed. that spike resulted from tuesday 27 feb 2007 plunge. for my charting i use the basic/free version of prophet.net java charts - the application saves your drawn trend lines and extends them out to infinity for you, so over time, as days and price action accumulate, you can see how they react to or ignore these lines. check out how the $VIX ran right up to that trendline and bounced down - pretty predictive, right? you can bet that if the $VIX breaks through this downtrend line and holds above it, the markets will be much less complacent.

ISSC - it's rare that i post long suggestions, but this chart is a beauty, and i will follow it just to see how it develops. again, breaking through the blue line and holding it is key for entering this position long. on the flip side, if the stock fails here, it most likely becomes a great short candidate.

would you short the breakout? - see what kirk means in his post over at the kirk report

trend lines at work - NYX for short?

update 1116am friday 3/2 -NYX opened strong and remains strong. it has already filled yesterday's gap - still monitoring

update 402pm thursday 3/1 - NYX closed above its opening price, but there was a huge gap down at the open, and it didnt close up much on more than average volume. i will be watching this one tomorrow morning for a short entry.

in the chart below, the intersection of the blue uptrend line and the red horizontal support line represents a critical support for this stock. if it's broken, especially with decent volume, there could be more downside, otherwise, if this support holds, i wouldn't consider shorting until there is retracement up to the underside of some significant support line or moving average.