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Tuesday, October 02, 2007

 

anticipating a failure is not crazy


this is a chart of the russell 2000 as it sits today.


this is a chart of a recent past success. note the solid bottom and capacity of net points to shine while obv and a/d line at least keep pace at previous price levels as they were encountered on the way back up.


this is a chart of two failed rallies in the russell. note the inability of the rally to drive net points into a leading position, and the laggard nature of both obv and a/d line. even in the face of rebounding new highs, this presented a condition of failure.

a similar picture for the s&p, now testing its june highs.

past success, though this one not as clear as the final successes in the following chart.

here the propensity for red and yellow nonconfirms until the final, sustainable bottom is in.

here's the iyf. a series of very poor behaviors has given way to a couple green leaders on this latest post-fed-cut rally. there's a gap to fill about 3.5% up from here at 116.90, and it may get filled.

here's tech (iyw). this now looks seriously overextended with nonconfirms across the board.

there might be some more upside left to this rally, but looking at these metrics it would seem the vast bulk of it is gone -- and the market is on very thin ice, quite possibly setting up for that retest of the august 16 low that i've been looking for all along (but have traded so poorly).


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