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Strategies & Market Trends : John Pitera's Market Laboratory

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Davy Crockett

roguedolphin

To: George Statham who wrote (15821)	4/14/2014 12:03:04 PM
From: John Pitera	2 Recommendations of 33421

George here is a chart of the XBD (Broker dealer index).... they have already hit there 200 DMA and so it makes sense that they are rallying. today. I have made a chart of the XBD from 2007 to 2008... XBD spent a lot of time rolling over.... and heading lower on the next post I have a chart of the SPX from that 2007 to 2008. the Market in 2006 and 2007 had the most unnatural look of a market that went up in a very controlled fashion and it took a long period of time rolling over. The XBD reached a high of 268.65 in june and broke down decisively below the 200 DMA in August and it was a long long painful trip down. The SPX which is overlayed on this 2007-2008 chart did not top until Oct and it documents how the Broker Dealer index and often the BKS are leading indicators. When Jim Cramer had his hedge fund partner and the real trade Berkowitz reluctantly providing short term commentary back in 1997-1998, Berkowitz was always looking at the XBD, BKS, the $SOX and the Biotech $BTX Indexes as the tells. of what the broker market was going to do. In summary right now the XBD has been weak enough to already hit it's 200 DMA and is naturallly bouncing, the BTK is weak is approaching it's 200 DMA. The $SOX has been selling off and has just gone below it's 50 DMA and it might well be an excellent trading short as it trys to get above it's 50 dma.... if not it will be heading lower to the 200 dma The $BKS has been weak and is also approaching the 200 DMA xxxxxxxx

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