Posted on 02/10/2004 4:49:46 PM PST by Orangedog
"Weekly Charts"
DJIA: Bullish above 10700, bearish below 10425, and neutral in-between.
DJTI: Support at 2800 held, thus we ought to expect another test of resistance at 3100.
SP500: Bullish above 1155, bearish below 1122, neutral in-between.
NASDAQ: Bullish above 2155, bearish below 2000, neutral in-between.
HUI: Support at 205, resistance at 260. Support held. If it can close above 235, it will challenge the recent highs at 260.
US Dollar: Resistance at 88, support at 85.
CRB: It has support at 257, resistance at 270.
Oil: It has support at 32.00, resistance at 35. If it closes above 35 the next target will be 37.0, and then 40.
Utilities: Resistance at 274, support at 266. Maximum upside target: 315.
Real Estate (DJR): Support at 186.
Last week (1-30-04) I said, "Last week's action resulted in a rather mixed picture which, in our view, calls for a "neutral" bias going into next week. First of all, NASDAQ did close below 2105 which was negative, but the SP didn't close below 1122 which was positive. The McClellan Oscillators got to oversold territory, which means, a bounce should be imminent--a positive--but, the rest of the indicators didn't come even close to the bottom of their ranges, which means there could be additional downside risk in the markets--a negative. Based upon the current levels of most of our indicators, we estimate any additional downside risk to be approximately 2%-3% for NASDAQ, and 2.2%-4.2% for the SP. All in all, we ought to be prepared for either a bullish or a bearish action next week, and perhaps a dose of both! Notice that as long as the SP remains above 1122, price is controlled short-term by the rising green channel which is bullish, and suggests that the SP can rally from channel support all the way up to channel resistance at 1155-1160. We believe that the odds favoring either scenario are almost even since each positive is being offset by a negative, and vice versa. Consequently, if the 1122 level holds, we can trade on the long side with a trailing stop, originally set at 1122, and be ready to exit the long and switch into a short position in the 1155-1160 zone, assuming that the SP will roll over at channel resistance. If the SP takes out the 1122 support level, then we'll wait to go long in the 1095-1088 zone."
Current Analysis We did get the additional 2% loss in NASDAQ, but the SP held above the critical 1122 level, while all indicators got near the bottom of their range. Last week's action was identical to the action that we have seen over and over since March of last year. We got a sharp internal correction while giving up very little in terms of price, suggesting that the bull is alive and well. The only element of difference in this latest corrective episode was the total absence of concern, or bearishness on behalf of market participants, no increase in the assets of the Rydex Bear Index funds, no spike in the put/call ratios. Strictly speaking from a technical point of view, since the SP held above trend-line support at 1122, and given the strong breadth that accompanied Friday's rally (over 2000 net advancing issues), in combination with the rising Thrust Oscillators, the odds favoring continuation are better then even! Consequently, as we said last week, we ought to trade on the long side with a stop loss at the support levels indicated in the table below. We got two concerns going forward; one is the lack of total concern among market participants, and the other is the fact that the McClellan Oscillator got to the -200 zone for the NYSE. Usually when it gets to that level, we get a rally up to the zero line, and then it turns back down again. In summary, the technicals and the price action are telling us to be bullish. At the same time, the action by the McClellan Oscillator and the lack of bearishness on behalf of market participants also suggest that we need to keep trailing stops on long positions.
Ike Iossif
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Copyright ' 2004 All rights reserved. Ike Iossif
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I want more charts, please. My brain isn't full yet.
/sarcasm
What is 'T O' matched up with the 3 D Moving Average???
Dude says expect Bullish/Bearish next week..."a whole lota shakin' goin' on!!
What is 'T O' matched up with the 3 D Moving Average???
Dude says expect Bullish/Bearish next week..."a whole lota shakin' goin' on!!
Dude says expect Bullish/Bearish next week...
That's our boy...he might not know much, but he's never in doubt.
All in all, we ought to be prepared for either a bullish or a bearish action next week, and perhaps a dose of both!
The new guys they have at least know how to CYA rather than their legacy folk who were just always so wrong, wrong & wrong. ROFLMAO
Guess I'd better pick up that new microwave oven and VCR before the prices skyrocket, huh?
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