ETF Prophet

The bulls managed a 4th day of upside on average but better-than-expected economic reports.  Cracks appeared mid-morning and the bulls were able to save the close.  Breadth was decent, but there were some notable reversals in some recent leaders like AAPL and BIDU.  There seem to be some support around the 1200-1205 level as we [...]

This move has the SPY pushing well into it’s 23% Fibonacci extension and into the low end of prospective resistance zones. Financials and Energy have the SPY outpacing the QQQ and IWM.

The XLF/TBT pair model has produced a nice equity curve during the recent market turmoil but now appears a bit overextended.  Recent gains have pushed the curve well above the R Squared line and current signals should be considered cautiously.  There are 2 ways to trade this model, one using Z score band reversals and [...]

I am seeing some signs that the market is likely to pull back in the next few days.  On Tuesday the SPX closed just slightly higher while the VIX also rose.  This triggered the study below, which I have showed before in the subscriber letter,…

The market overcame a very poor consumer sentiment number this morning on some large cap window dressing and QE3 optimism from the FOMC minutes.  We are going to continue to hear about fiscal and monetary moves to rescue the economy before the next FOMC and Obama’s job plans early next week.  As August comes to [...]

Price has put in a higher high, but note significantly weaker internals going into the Fed minutes release.

  Everything’s green today except VIX and VXX, although the VXX, in its usual schizoid behavior, is actually up 1% for the day. There is no VOLUME  BUZZ, not the metric column….just no volume buzz.  After the opening pop and drop things have rebounded somewhat to R2 with little momentum pushing either way, thereby increasing [...]

The bulls charged all day with breadth better than 7 to 1 positive and a huge move in the small-cap indices.  The volume is very weak on this follow through day.  Is the storm keeping trades out of action?  The bulls broke through two key resistance areas at 119.60 and 121.20 on the SPY today [...]

The SPY is pushing up to its recent channel highs in the $121 range.  That level (cough, cough), shouldn’t be that easy to cross, but it looks like the market is looking for reasons to take a break from the unabated selling and volatility.

Finishing off our study of DBA today with a look at the DBA and MOO dynamics.  We would be surprised if the bovine factor wasn’t highly correlated with DBA and our ETFR pairs study does not disappoint. The 17 day projected excursion is a nice easy swing cycle and the one losing trade out of [...]

The Jackson Hole press release had traders feeling there may be fiscal hope going into September, leaving the S&P 500 (SPY) +4.7% higher. That plus “less worse than expected” hurricane damage, and a transition into positive seasonality may support current to higher prices next week (although shorter-term models are looking for a pullback early in [...]

As expected, Fed Chairman Ben Bernanke’s did not offer up QE3.  Initially, traders were concerned but new hope developed that something is likely to be announced after a two-day meeting in September. While it was a clear victory for the bulls today, the volume remained subdued.  We are now in a clear trading range between 1120 and [...]

On the tails of yesterday’s DBA/UUP setup, this is a look at how GDX can be useful as a confirmation signal, albeit on a somewhat longer time frame.  These are impressive % gains for a 21 day excursion and it should be noted that the one losing trade…closed on 8/2…had clearly exceeded the 21 day [...]

Berkshire Hathaway’s $5 billion investment in BAC gave us a good pop but the resistance area from last week’s massive sell off, a surprise flash crash in Germany, and overbought reading under the 200 day moving average caught up to the bulls.  However this lower’s the bar for Ben tomorrow and maybe bullish.  Option are [...]

The strong move higher on increased volume meant that Tuesday was a Follow Through Day (FTD). FTDs are a concept that was created by William O’Neil, founder of Investors’ Business Daily. I have written about them extensively on the blog. In June…