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Strategies & Market Trends : Technical analysis for shorts & longs

SPY 691.88

-0.3%

Jan 30 4:00 PM EST

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To: Johnny Canuck who wrote (47501)	2/12/2012 10:46:13 PM
From: Johnny Canuck	Read Replies (1) of 70330

The indecision on Thursday was resolved to the downside. We expect there to be 3 days of selling in the absence of news on Monday to reverse the direction of the market. The SP500 stop just shy of breaking the support level of the last 5 days of trading around 1340. Same comment on the DOW. Filled the gap on the DOW transports. The trading on Monday is critical. If it continues to trade down on Monday a sell signal would be triggered. This would mean the DOW would sell off at some point. The up trend is still intact on the COMPQ. I don't like the fact the sell off on Friday was on extreme accelerated volume on a gap opening. It means large institutional investor were taking profits. Consolidation on the financial resolve to the downside. Wait for confirmation of the sell signal on Monday. Despite gold finishing up on the day a sell signal was confirmed today. I would expect gold to test 1625 at least. What it does not will tell us if the pullback is just a simple failure to break the downward channel on the first try or something more serious. The situation in Greece cause the markets to open down in a gap open. Most of the indices saw profit taking. Given the greater than 20 % move up in the markets since the end of December it would be normal to see traders take profits at the first sign of trouble. The major earnings are not out. We won't see a catalyst from them till the next earning season starts at the beginning on April. Interesting gold is not see a a safe haven here at the GLD did a gap open to the downside also. Though it finished positive on the day it still finished below the low of the previous day indicating weak demand.

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