QQQQ....this chart is the hardest to read as it has withstood much of the weakness in financials. this chart might hold its support but its more likely to just fall nicely down its channel
IWM...similarities with the previous leg down make me wonder if we are setting up for the exact same outcome. Watch for a close below 200 as good confirmation of more weakness to follow
XLF...again, we see similarities in price patterns with the the prior leg down. It was XLF's intraday weakness that dragged down the market and caused it to lose all its morning gains. If we fall, XLF will certainly do the same in the daily chart. But strength at the end of the day on decent volume is something to take note of...
UUP...back up to resistance...breakout or breakdown? with a position in commodities, i definitely will need to pay attention to tomorrow's price action of the dollar
USO...oil making a higher low? if this holds, and shoots higher, we might again see 150 dollar oil. But for now, USO needs much more volume to break resistance.
XME...looking much less bearish than before...chart still the same. oscillators and a refreshed mind is what changed...
Analysis: I have to first say that today is my first day doing the analysis with new parameters for the MACD. For about the past 1/2 year, i have been using a faster MACD. Today, i felt that it would be good to go back to the parameters most ppl use and to my surprise, everything made so much more sense. Patterns were no longer so neutral and were actually much more bearish. It made me rethink my holdings and feel that XME might be turning bullish instead of on another leg down. As i think that i might be placing too much emphasis on oscillators and less on price, i will be patient and methodical with my intraday chart analysis tomorrow. I will sell only if price says so...the dollar will be important and so will the relative strength of commodities if the market falls tomorrow. Overall though, i am feeling much more bearish on the market than before...i see patterns i didn't see before and most of the signs now look bearish. but i am hesitant to predict that a breakdown will occur before labor day as we are still suffering from very light volume. the price move i am expecting to occur will need much more volume than we are having.
I would like to add that today, as the market fell after the morning strength, i noticed that as oil was falling down, so was the market. It made me think that maybe the market likes strength in oil and needs it to stay above these levels (maybe it really is a good sign of global growth / weakness)...I thought that its possible that most of the traders are trading energy and as those stock fell, so too did the market. But as the day went on, SPX didn't seem to follow oil quite so much. So i had to look at other sectors, and realized that SPX fell and rose all because of XLF...financials lost steam early and the SPX eventually was dragged down by the financials. And as XLF shot up late in the day, so too did SPX...My conclusion is that oil really doesn't mean much to the market anymore, unless it can break its resistance or break down past its support. the neutral range where oil sits now is of little concern to the traders...So until we see a breakout or breakdown, i don't expect to put much weight on USO in my analysis
Game Plan: Look to sell short commodity positions and to buy a short position in financials if the market continues to look weak.
Bias: 70/30 bearish
Buy List:
AMZN
INTC
UNG
Sell List:
ILMN
ZEUS
WYNN, LVS, MGM, PENN
NYX, CME
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