Friday, October 15, 2010

Quick before-the-bell post

Dear Readers,

So, everything goes as expected so far. The bearish cycle begun tuesday manifested yesterday.

I'll make a quick general market status summary with a few sentence of commentary.
New readers please read posts since last Friday. Thanks.


As I told recently, USD is in focus now. It has reached the inherited ichimoku support yesterday.
This level should be defended, and at least tried to be put toward 80s. As USD started to be an inverse mirror of SPX, I expect market consolidation, also correction in gold prices.

I will adjust chart above, things happen a little faster I thought, trend is important.

Marketvolume implemented USD today. It's great! They made a small trick: since this index does not have volume, they calculate volume of US Dollar Bullish and Bearish powershares.
Now, as we have USD, GOLD and RUA/SPX on marketvolume we can make holistic analysis about market and gold as well! If you are interested in further details, please follow this link: .

Let's see marketvolume chart of USD:

We can see typical bullish pre-signals on 1-day:
-Histo gives positive measure since yesterday
-SBV oscillator above critical level, signals possible elimination of bearish volume
-Long-preriod histo is positive as well

In order to have more bullish signal, zero level buying volume needs to rise from zero, also momentum needs to converge to zero from negative readings.

In summary: We have high possibility of dollar trend-change. Possible resistance is 77.5.


RUA 1-day:

Internals remain intact on 1-day chart.
-Histogram is in positive territory and made some gain yesterday
-Oscillator is still strong producing 3% gain yesterday
-MVO started to signal a local surge
-Market lost momentum, but still in strong positive territory
-Sentiment is steady 59

All readings are bullish, except momentum, what is a leading indicator of change.

RUA 60-min:

We had a very strong bearish attach. Oscillator gave extreme signal (-86).  Market is nervous.
It can indicate a start of a trend-change on 1-day chart.
MVO gave a bearish trend-change signal, momentum went to negative afternoon.
Sentiment is below 50 what is a clear signal of short-term trend change.
Longer period oscillator (fakeout oscilator) is on 1% signaling sell signal.

Summary: .
I'd be really surprised if first hours were not red, then I count with some easing and some sell last hours.
We need to check how strong effect will that huge bearish power produce, that can generate trend-change.
Also bullish internals on USD suggest a breakout and price manifestation will generate some rise.

Please note: market trend change is a pretty slow process as you can see. We could see that change since it's beginning, and now it will be the 3rd day of it. As bearish volume is still steady 0 on RUA, I am not selling my 1 unit of SPX.


Gold miners matured for a bearish price manifestation.
-Histo gives negative numbers since 13th of october, indicator decreases every day.
-Oscillator lost 6% in 2 days, now it has 3% left from critical level
-MVO had a 3 day sequence of 1-2-1 reading, usually shows last thrust
-Momentum oscullator gives negative reading (-4), lost 11% in a day
-Sentiment lost 11%
-Long period histo gives slight negative readings

However selling volume is still steady zero.
After a long rally gold had it's matured for a correction. We reach phase 3 soon (please read my corresponding post)

Good luck !

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