Bull Friday? December 16th, 2010.

Today the markets were bull (Agaist my yesterday forecast). 

Results

- Dow Jones                 11,499     +42   +0.36%
- Nasdaq                        2,637     +20   +0.77%
- Standard and Poor's     1,243       +8   +0.62%
- IPC                            37,833   +156   +0.41%


Good economic data today (on average). And the IPC follows SPX.

Indexes

IPC

- Almost all the stocks are in consolidation. Then the IPC behaves in line.

- Important resistance to break 38,000 to return to the Rally.

- Possibilities of a good year end, but with ups and downs. 

- The selectivity of stocks is very important in the next two weeks. 

Standard and Poor's

- Breaks the bearish channel. Now forming a bull channel.  Can be the 5th Elliott wave? Is preparing for a big bull day tomorrow? Tomorrow mandatory break 1,247 to bull. 

- Remember the Hindenburg Omen is a mid-term bear signal. 

Nasdaq 100

- Breaks the bearish channel and is forming a bull channel. This is a bull signal if tomorrow break 2,225.

Dow Jones Industrials

- Without pattern. Important to break the 11,517 level to return to the bull territory. Mandatory for a bull day tomorrow. 

VIX

- The VIX:VXV notes that maybe we are close to a top (high). In addition to the next signals: 

1. Hindenburg Omen. Post of dec. 14th and dec. 15th, 2010. 
2. CPC and CPCE very low many days in a row. Post dec.15th, 2010 and today. 
3. Seven green candles in a row. Post dec. 14th, 2010. 
4. New York Highs of 52 weeks too high. Post dec. 8th, 2010

This is not conclusive but take care. 

CPCE 

Put to Call Ratio on Equity too low. Two observations: 

1. Tomorrow probably a green candle. 
2. The SPX is close to a top (high).

Seasonality

- Dow Jones                  48%

- Standard and Poor's    52%

- Nasdaq                       43%

-- Tomorrow neutral.

- This week is Triple Witching so bull.

- The most important issue, tomorow "Bull Friday": 

Conclusions

- The shor-term and mid-term trends are up.

- Hindenbur Omen Confirmed. 

-- Many bear signals accumulated.  

- Should be very cautious with the trading.

- While the liquidity continues flowing in the market will continue up.

- For tomorrow my feeling is bull: 

1.  Bull Friday. 81% probabilities for bull. 
2. Triple Witching. 66% probabilites for bull (last 27 years). Maybe a huge up. 

¿And the forecast for the next year? 

According to Bespoke (who takes the oppinion of many financial institutions): 

1. This year is over the average. So if the forecast are correct and tomorrow we have an up, then the market should correct before the year end. 
2. For the next year the forecast is a modest +11%. But at least bull. 

I hope Deutsche Bank analysis is correct. 

IPC Sandard and Poors Dow Jones

Hindenburg Omen Confirmed. December 15th, 2010.

Today the markets were bear. As the yesterday forecast says.

RESULTS

- Dow Jones                 11,457    -19   -0.17%

- Nasdaq                        2,617    -11   -0.40%

- Standard and Poor's     1,235      -6   -0.51%

- IPC                            37,677  -224   -0.59%

According to Sentimentrader the market sentiment is extremely bear. (Despite today correction). 

Indexes 

IPC

- In a trading range. 

- Difficult -and risky- times for day trading. Selectivity in issuings is extremely important. 

- Increase the risk of a correction. 

Standard and Poor's

- Lower highs. Thats not good for bulls. Chart from Bespoke: 

- Respects support in 1,235. Next supports levels: 1,228 and 1,173.

- Forms a bearish channel. Not good for bulls. 

Nasdaq 100

- Respects suppor in 2,200. If break is a bear signal. Next support 2,115. 

- In a bear channel. 

Dow Jones Industrials. 

- Respects support un 11,450. If break is very bear signal. 

- Next support 11,130. 

Put to Call Ratio. Very low again. 

For tomorrow bear or bull? 

- If you look the last weeks is a bull signal. Tomorrow follows a green candle. 

- If you look the last 6 months is a bear signal. Tomorrow follows a red candle. 

But, the most important matter. Is almost certain that a top is near (or we are in a top). See the chart: 

VIX

- Rebound in support (above the lower Bollinger band). And maybe will search the higher Bollinger band. 

- This movement could be aligned with the CPC and de Hindenburg Omen. 

And the Hindenburg Omen Confirmed today. 

- This indicate a correction in the mid-term. Maybe a huge correction. 

- Not good for the bulls

Repeat the chart of the statistics. 

Seasonality

- Dow Jones                 57%

- Standard and Poor's   57%

- Nasdaq                      48%

-- Tomorrow neutral.

- This week is Triple Witching so bull.

Conclusions

- The shor-term and mid-term trends are up.

- The bearish signals start to dominate (Hindenburg Omen Confirmed), but still bull signals. 

- The market is in bull territory and the conditions for a consistent up trend (Rally)are given. I'm optimistic (bull) for the year end. But we can be close to a top, if confirmed fades the bull future.

- In this time be very careful with the trading

-- While the liquidity continues flowing in the market will continue up. But bother me so many bear signals should mean something. But the maket is very erratic (like a crab).

- For tomorrow my feeling is bear.

IPC Sandard and Poors Dow Jones

Hindenburg Omen. December 14th, 2010.

Today the market was bull. But, not so bull, it can't sustain the advances. 

IPC

- Bull, but marking a trading range. To re enter to bulls territory need's to break the top. 

- The markets from the emerging economies are very advanced and very bull. According to "The Economist" bigs amounts of "hot money" (especulative) are enter to emerging markets. And the IMF (International Monetary Fund) guardian of the world free market, agree with establishment of global capital controls. If a economic shock affects this economies the withdrawal of the money can collapse this economies, and in this moments are the drive of the world economie. 

Standard and Poor's 

- Bull but not strong. 

- Break the dynamic support. 

- It can't get up without a significative correction. 

- 6 days up in a row, tomorrow probably a red candle. 

Nasdaq 100

- The most price advanced index. Is forming a bear channel?

- Break the dynamic support. 

Dow Jones Industrials

- Broke two times the 11,450 level. But both times tries to return. Not a bull signal. 

- The flag formation is discard. It will be a very bull signal, but after de break the DJI shoul get up vigorously. 

VIX

- Today both SPX and VIX a green candle, so tomorrow probably a red candle (60%)

Put to Call Ratio. 

- Today CPC and CPCE close above the "too low" levels. So are triggering the "close to  a top" signal. 

Bank Index

- Financial sector cant break the bearish patterns. Is now correcting. This is not good for bulls and for the SPX. (Bear signal).

New York Lows of 52 weeks. 

- Are indicating we are close to a "bottom" (?)
- In a bull day a very high level of "new lows"?

At last but not least: Hindenburg Omen. 

- A very bear signal. The theme today.
- Today triggered the firts sign of Hindenburg Omen.
- My bear fears materialize? A drop is coming?
- This indicator needs a confirmation in the next 15 trading days. Stay alert. 

Seasonality 

- Dow Jones               43%
- Standard and Poor's 38%
- Nasdaq                    43%
-- Tomorrow bearish.

- This week is Triple Witching so bull.


Conclusions

- The shor-term and mid-term trends are up.
- Mixed and faced singnals. How about the Hindenburg Omen?
- The market is in bull territory and the conditions for a consistent up trend (Rally)are given. I'm optimistic (bull) for the year end. But we can be close to a top, if confirmed fades the bull future.

-- While the liquidity continues flowing in the market will continue up. But bother me so many bear signals should mean something. But the maket is very erratic (like a crab).
- For tomorrow my feeling is bear.

IPC Sandard and Poors Dow Jones

Not bear, not bull. December 13th, 2010.

Today starts bull but ends bear.

IPC

Still strong but could enter in a side chanel.

Standard and Poor's

Today looking for new highs but with divergences and contradictions.
Many reversal candles.

And very oberbought. (Bear signals).

Put to Call ratio. Too low. 

I know, it failed a lot recently, but look a the pattern when CPC and CPCE are too low for many days in a row. Very bear signal, still latent.

VIX. ¿A bearish pattern? 

See the chart. Is the history repeating?

Lows of 52 weeks. A little crazy?

Indicates a bottom, but this not sound logical to me.
Do you feel safe in a market with this kind of indicators?

Seasonality 

- Dow Jones 48%
- Standard and Poor's 43%
- Nasdaq 38%
-- Tomorrow slightly bearish.

- Tomorrow, also, Federal Open Market Committee wich is traditionally bull.
-- But if red, this will be a very bearish signal, and possible a turning point.

Conclusions

- The shor-term and mid-term trends are up.
- Still pending the Dow break of the 11,450 level and resolve the "Flag".
-- Many bear signals still valid.
- The market is in bull territory and the conditions for a consistent up trend (Rally)are given. I'm optimistic (bull) for the year end.

-- While the liquidity continues flowing in the market will continue up. But bother me so many bear signals should mean something.
- I dont feel safe and comfortable, I maintain liquidity, very rare movements of the market. Maybe will not fall but maybe not go anywhere. Tomorrow my feeling is neutral but becomes short-term bear.


IPC Sandard and Poors Dow Jones

Bull Friday. December 10, 2010.

Today the markets were bull.

1. Thirth consecutive day the SPX closes above 1,228.

2. Nasdaq 100 break the 2,200 level, convincingly.

Today Bull Friday:

But persist many bear signals:

a) Put to Call Ratio too low, many days in a row.

b) Dow can't breake the 11,450 level and don't resolve the flag.

c) Many divergences.

d) Signals of a possible top.

e) The volume has been moderate.

IPC

- Stable day without many changes.

- I'm optimistic about the year close:

-- Target level 39,500

-- Support 37,000

- Still in overbought, that produces the profit take and corrections, maybe not over.

Standard and Poor's

- Resolve up the ascending triangle. Target 1,245.

- 3th day in a row that close above 1,228. Very bull signal.

Nasdaq 100

- Break the 2,200 leve convincingly.

Dow Jones

- Caution. Can't break the resistance and the Flag is not resolve.

- Normaly Dow leads SPX in breaks, the actual situation is unusual.

- These can mean something. Stay alert.

VIX.

- When VIX and SPX closes in green both, the next day probably will be a red candle.

- The VIX continues searching the low band of Bolliger, when touch it the up trend will have a pause (correction?)

- A formation named Broadening Bottoms is forming. Is bullish 53% of the time. But if broke down, it will take the VIX to very unusual low levels.

Liquidity

¿Why the market continues up, despite all the bear signals?

- The Liquidity Flows is positive. And this override many other indicators, like divergences. While the liquidity continues flowing in the market will continue up.

- Next the chart from Stocktiming showing a very bull landscape:

CPC

- I will not repeat the same (If CPC <= 0.80 probably red candle tomorrow) 

- I note what happened when several consecutive days, remains very low. Both the CPC and the CPCE, where the effect is clearer. [This to me is a bear sign, that I do not discard] 

 Seasonality 

 - Standard and Poor's 48% 

- Nasdaq 61% 

- Monday is statistically neutral. (Sunday I will have the update for this number for dicember 13th, 2010)

- The next week is statistically neutral. But is "Triple Witching" that turn it bull. (This week is statistically bear and closes up). 

 "Bear Monday": 

 Conclusions 

 - The shor-term and mid-term trends are up. 

- The SPX and Nasdaq 100 confirm their respective breaks. Still pending: 

 -- Dow break the 11,450 level and resolve the "Flag". 

-- Many bear signals still valid. 

 - The market is in bull territory and the conditions for a consistent up trend (Rally)are given. I'm optimistic (bull) for the year end. 

 - For monday slightly bear. (VIX, CPC and Bear Monday) 

-- While the liquidity continues flowing in the market will continue up. But bother me so many bear signals should mean something.

IPC Sandard and Poors Dow Jones

Today a boring session. December 9, 2010.

Today the markets were bull. But a weak and lazy bull.

IPC

- Profit take continues today.

- Bank of México reports inflation better than expected. (4.32% year forcast).

- The issuing companies are close to technicals resistances, and the market is extremly oversold. That causes the profit take.

Mixed signals in the US market.

- Tomorrow observe, they shoul align and trend in the same direction. 

Standard and Poor's (SPX)

- Today an ascending triangle forming. Tomorrow will resolve (bear or bull). 

- Today confirm the break of the 1,228 level. But unconvincig. 

Dow Jones (DJI)

- Maybe a Flag is forming. Bullish formation (54% of the time). 

- Resistance in 11,450, still far away. 

Nasdaq 100

- The break is not clear. Unconvincing. 

VIX

- In the hard way, down. 

- Is easier for the VIX to go up than down. And also has more space. 

- Look for the VIX:VXV marking a possible high. 

CPC

- When CPC <= 0.80 the next day more probable a red candle. 

- Yes, I know, recently has failed a lot. But observe what happen when many "green lines" consecutives. (For me a bear signal). 

- The efect of the "green lines" is more evident in the CPCE

Fiancial sector. 

Bank Index. 

- Accomplish techincal target.

- Very bull today, helped by AIG. 

- The SPX cant go too far without the bank's. Today SPX has foundation to contruct his Rally.

- Remember the financial sector is underperforming the overall market. 

But be carefully look to this chart of Bespoke: 

AIG 

- ¡What a candle today! (+12.7%)

- Will pullback tomorrow? AIG is a surprise box, previous days looks weak but with the announced of the preapay to the goberment shot up. [That doesn't happen with Citigroup]

Seasonality

- Dow Jones                57%

- Standard and Poor's  48%

- Nasdaq                     43%

-- Tomorrow neutral day (slightly bearish)

* This week is statistically bear. 

Conclusions

- The short-term and mid-term trends are up.

- The SPX validate the break of the 1,228 level, but unconvincing, so be careful. Wait until confirmation:

-- Dow close over 11,450 and the resolve of the "flag".

-- Nasdaq 100 close over 2,200 but in a convincing way. 

-- SPX resolve of the ascending triangle. 

--- Observe increase in volume

- We aren't in a Rally until confirmation. I'm optimistic about late december.

- Mi short-term sentiment is bear [So many bear signals should mean something]. For tomorrow I am neutral. 

-- Conjecture: If tomorrow opens with an up GAP, could break the triangle up and this should take the SPX to 1.246.

IPC Sandard and Poors Dow Jones