Donald: Well, my analysis is actually giving me mixed signals.
Note: My Indicators do not use the Gerald Appel MACD formula, however I do use the MACDX format to display the Indicators and produce signals. This allows me to note momentum and direction rotation. Thus I can sometimes forward look my Indicators, but I should always wait until the signal is rendered, as the potential to get burnt is always there. My Indicators are TREND FOLLOWING and not predictors. Close works for me!
As of late, I have been trying to predict Market moves in advance and my stuff really is not designed to do that. However, coupled with chart formations often it can be done somewhat successfully, but timing is not exact. (Once I finally start analysis using intraday data, I will be in a better position for shorter term calls.)
Now having said that: The IND, NYA and SPX Indices are in short-term (A) sell signals, coupled with Bull Flag formations in the process of resolving to the norm. Since a Bull Flag is a consolidating pullback after a sharp rally, this adds up. (To view Bull Flag formations look at the Actual Intraday Semi-Log 60 Minute Interval Charts)
However, these Indices are currently in short/medium (B) and medium/long (C) term buy signals, coupled with my long-term (D) confirmation signal still in a sell.
The Bull Flags on the Dow Industrial, NYA have broken to the up side slightly and SPX is till trading within the confines of the Flag. The Market needs to move up Monday to confirm a breakout to the up side. If it does, this would imply a continuation of the rally.
The Dow Tranports and RUT have participated in the rally, but as of late are definitely giving signs they have lost momentum and are rolling over. Let us not forget they led this downturn and could lead it down again!
The WILD CARD is the FOMC meeting. If the FED cuts or does not cut is really not important. How the Market reacts to the action IS. Often the Market (the Big Boys) signals in advance intentions. I believe the various divergences in the Indices have achieved their purpose, to confuse.
Donald you as always are looking for additional ways to tip the Markets hand. Your latest is going back decades to look at High/Low data. This has buoyed your confidence to call the Market with minimum ifs. As always your efforts are appreciated by me.
I really have no TA analysis that makes the call, the rally will fizzle, yet! But the Transports and RUT look to be rotating to head back down. And, the one short/medium term moving average I use, is poised to support that analysis.
Note, the DJI, NYA, SPX and NASDQ are bouyed above their respective 200 day SMA while the Transports and RUT never made it and as mentioned above are showing signs of weakening.
My GUT FEEL is that the Market (as measured by the DJI) will rally finding resistance at the 9100 area. And, if penetrated will find final resistance in the 9200 area. (Old Bull Support Trend Line derived from Theoretical Daily Semi-Log Chart) Then the Market will begin a more aggressive pullback. The depth of that pullback may determine if this was a Bear Rally or NOT.
Of course a break above the old highs and I will most likely put my shaps on and start riding the Bull...<g>
(All Disclaimers Apply)
Regards,
LG
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