ES -- DX/CL -- isee -- cboe put/call -- specialist/public short ratio -- trinq -- trin -- aaii bull ratio -- abx -- cmbx -- cdx -- vxo p&f -- SPX volatility curve -- VIX:VXO skew -- commodity screen -- cot -- conference board

Wednesday, December 19, 2007

 

is this a buy point?


god help me, it might be.

the index has revisited its consolidation zone from november in price, where i evacuated my shorts and started putting on long positions. but is showing clear positive divergences across the board -- net points gained, net volume, net advancing issues, issues trading over their 30-day moving average, issues trading over their 150-day moving average (not shown), and mcclellan oscillator to boot.

moreover, improved participation shows in issues within 5% of new 65-day highs, issues within 5% of new 65-day lows, new 65-day lows, 65-day new highs minus new lows, and all the corresponding 20-day measures to boot (not shown, except 20-day new highs minus new lows).

even better, a similar (but less clear) picture emerges from these same measures applied to the s&p 500. index price there has not yet plumbed its november lows, but most of the positive divergences are there from similar price levels in november.

further still, isee sentiment moving averages are continuing to improve in general from what looks to have been a bottom coincident to late november.

my longer-term pessimism is severe, no doubt. but can i imagine the narrower equity indexes rallying on momentum terms headed into january, in defiance of any and all economic concerns? absolutely. it's already happened once, and there's gas in the tank.

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