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Charts courtesy of stockcharts.com

Friday, October 14, 2011

Friday Weekly Charts

 IBD's market follow through call, which baffled me when I found out about it, has held up, even in the face of severe resistance. 1220 looked like a level that would not break, and I almost went short when it failed to break this morning, but when I saw the market heading back, I knew that someone was positioning the market for a last-15 minute surprise. It came, and was to the upside. In the past, a high percentage low volume move like this would collapse pretty quickly, but in the HFT driven market of today, moves like this are easily sustainable. It looks like we have clear sailing up to the 200dma, and there is no way in hell I am going to try and guess what it does when it gets there. 

Well, at least the weekly chart almost makes sense. We clearly have a hurdle to get through at the 40 week average, easier said than done. Maybe if volume drops another 40% we will get through it easily. 
 
The Nasdaq is already there, and at this rate less than a week away from a new high for the year. MACD is about to turn upward, and stochastics have turned upward. At this point I don;t see how it won't do it. '

 The Dow is going to be testing it's 40 week line soon, and is building momentum. Unfortunatelyu, it has some resistance to get through (pivot point wise) before getting to a new highs, but in a bull market the Dow really isn;t that relevant.

The transports have a lot of work to do. They have the biggest potential for gain, assuming they follow the rest of the market, but also have the most resistance to get through.

The Russell 2000 is in not much better shape than the transports.It's hard to believe this will successfully get through the 40 week line on the first shot, but it made mincemeat of the 10 week line, so anything is possible. 

One of the reasons I lost interest in watching pro sports on TV is that it got to the point where nothing happened in the game until the last two minutes. Then the teams pulled out the stops and the game completely changed complexion. It got to the point where if you only watched the last two minutes, you saw the whole game. I'm afraid that is starting to happen to the stock market. Sit on your hands all day, then place your bets as to which way the computers will take the market in the last 15 minutes. If I want to bet, I'll go to a casino, where the waitresses are better looking and they give you free drinks.

I will have the new highs update shortly.

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