Sunday, March 22, 2009

Technical Picture - Pullback Extends on Triple Witching Expiration

Accordong to IBD, Friday's triple witching pullback came in on much higher volume, thus compiling 2 distribution days for the S&P and one each for the DOW and NASDAQ since the 3/12 follow through day. IBD defines distribution as - an occurrence where trading volume is, without any price appreciation, higher than that of the previous day. Accumulation occurs when prices advance on higher volume. Accumulation and distribution occur with higher instituional particiaption. Stockcharts.com show lower volume for SPX and DOW on Friday, which is suspect given that OPEX usually takes place on aggressive volume.

Anyway, we have a star with long upper shadow on the weekly, so a cautious outlook going into next week. Over the near-term we expect further consolidation and pullback into the retracment zone of the 2 week rally. Retracements well beyond the R-zone will likely mean a retest of the lows, but we're not there yet.


Financials pulling back to R-zone.


Oil is approaching heavy congestion zone near $55.00.

Gold as per the $XAU, is breaking out of inverse head & shoulders pattern.. If this succeeds, the measured move target longer term is 100% from the bottom of the pattern to the BO point.

$USD is forming a bearish rising wedge on the weekly.

Using AAPL as a proxy for the strength of the tech rally, let's watch to see if it can BO of the base. A failed BO could be a good shorting opp.


Click on charts to enlarge

Taking some time off for personal business this week, so posting will be light.

2 comments:

Stewie said...

howdy jamie. i was wondering would you be interested in doing a trader interview with Tim Bourquin from traderinterviews.com? he asked me for a referral and i thought of you. I am sure there are plenty of folks who would wanna listen. i gave him your site address. keep up the awesome work here!

stew.

Jamie said...

Thanks Stewie,


Appreciate your thinking of me and I look forward to listening to your latest interview with Tim, but I'm going to pass. I need a couple more years experience.