John Pitera's Market Laboratory Message Board

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Strategies & Market Trends : John Pitera's Market Laboratory

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To: pcyhuang who wrote (12869)	10/13/2011 9:11:52 AM
From: Hawkmoon	2 Recommendations Read Replies (1) of 33421

Excellent idea. I agree with you wholeheartedly that the key issue is whether the U.S. financial sector starts to outperform the industrials. I was back testing the daily PSAR on FAS for the past two years. What I found was VERY interesting.. I cannot see one instance in that time period where FAS got so very close to it's daily PSAR (acceleration = 1) only to fail to "flip" it into uptrend. This seems to certainly be the case where FAS underwent a surging rally up to that daily PSAR, as it has in past trading sessions. From what I'm seeing it almost always manages to penetrate, then consolidate before moving upward from the nearest support. That's disturbing to me as the market was so very close yesterday to accomplishing that "flip", only to put in a shooting star on the daily candles indicating a reversal point. And now JPM came out with disappointing earnings, so it means that it's going to take more work (consolidation) and bringing that PSAR downward. But PSAR means "stop and reverse" and on a daily interval, this is a fairly strong reversal signal suggesting a sell-off is pending. In sum, FAS needs to penetrate 13.35 and FAS(t)!! Be nimble.. Hawk

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