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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Teresa Lo who wrote (5669)	12/1/1999 8:57:00 AM
From: Teresa Lo	Read Replies (1) \| Respond to of 18137

The Trader's Notes for Wednesday, December 01, 1999 The S&P 500 Index has now retraced to the 20-day exponential moving average, while the 5-day RSI of the CBOE Market Volatility Index goes into overbought territory. The Connors VIX reversal sell setups have arrived at their first target and traders will be looking to see if buyers show up right here. We need to be mindful that this is a test of top on the weekly chart for the S&P 500. With yesterday's action, last week's low was broken, triggering a sell signal in the weekly timeframe, producing two targets, the first being the 20-week EMA at 1350ish and the second at the October lows. A close this week below last week's low will produce a Japanese Candlestick pattern named "Three Inside Down". The Net stocks, as seen through the CBOE Internet Index, finds sellers at resistance. Treasury Bonds made an inside day. Traders will be sellers on break of yesterday's lows and be buyers on break of yesterday's high. As this is a test of bottom, what happens here is of enormous consequence. With the Nasdaq stretched so far to the upside, there is no room for much higher rates before the rubber band snaps back. The Trader's Notes prepares the trader for the day ahead, providing observations on market sentiment, internals, support/resistance levels and key pivot points in the major market indices using the daily chart. Use of moving averages and the Average Directional Index (ADX) indicator helps to determine whether the market is trending up/down or chopping sideways. Using Japanese candlestick charting techniques, observation of market action around support and resistance assists in the analysis of supply and demand based on fundamental principles of classical technical analysis. The results set up "if-then" scenarios used by the trader during market hours. Technical analysis is not used as a tool to "predict" the future or to pick tops and bottoms. It is used to detect areas of trend change and emerging trends. In a trading range, traders generally look to buy at the low end of the range and to sell at the high end of the range ? or stay out all together. In a trending market, traders generally look to enter the market on every retracement until it enters a trading range and ends on a test. The goal is to buy every dip in an uptrend and sell every rally in a downtrend. The trend is your friend until the end when it bends! Charts specific to these comments have been posted to intelligentspeculator.com