End of Day Wrap, XLF, AAPL QQQQ and UUP

Picture courtesy of epicharmus

OK, nothing is set in stone and even though it looked like we'd get a confirmation downside close, we got something very different. I started out the day with a warning about XLF (click the link). The 30-min 3C chart proved reliable as did the one-minute.

Next, the Q's, I warned to use caution in adding/initiating shorts, here's what the 2-min 3C looked like under accumulation and then how it ended for the day

Next AAPL regained a lot of lost ground-look at the 15-min 3C chart

Finally on Twitter/Chart.ly (click on link to follow my intraday charts) I posted a lot on UUP and how it would be great "if" it could close above the gap, while it filled the gap, it leaves UUP susceptible to downside.

In this chart of UUP you can see the positive divergence that led to the gap up and the subsequent negative divergence that prevented the close above the gap.

So, what is the story? Three simple letters: F.E.D Tomorrow it's highly unlikely rates will be changed, but Wall Street will be listening to every word to try and divine when the Fed intends on engaging in a policy of tightening. It all depends on what the Fed says tomorrow, but the nature of the afternoon rally, it's aggressiveness, it's broad base, makes me wonder of someone somewhere didn't get a heads up regarding the outcome. Stay Tuned.

On another note, PVR is proving itself, 3C has clearly shown itself to have significant qualities of prediction. I am a Worden and INO affiliate. I am only an affiliate for companies that I trust, believe in and USE!

In my more advanced classes I teach, "To make money in the market, you need to see what the crowd has missed" and this is the reason I write and use my own indicators. StockFinder and TeleChart (both of which I use -in TeleChart's case nearly a decade now) both allow you extraordinary capabilities to write your own custom indicators and so much more. If you want mine, please use my links, let them know you heard about them from Trade Guild and send me an email and I'll get you up and running.

If you feel like you'd like to write your own indicators, take a look at these videos (click the link)

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Remember-tomorrow is about 3 letters: FED 

AAPL-More Than Just a Bite?

Photo courtesy of Incase Designs

If you have been following my running commentary on AAPL, the latest my PVR indicator showing negative intraday divergences, (click the link for the article) you know where I think it was heading.

Take a look at this daily 3C chart-

Obviously there's a big negative divergence that's taken hold. Today may be the first day of a big bite out of AAPL. I also mentioned the Cramer effect-things aren't what they seem on Wall Street-click the link to read.

QQQQ Intraday Update

Photo courtesy of Joe Shlabotnik

If we get a close below the low of Thursday we have good downside reversal confirmation, but also a long swing setup should a subsequent day take out today's high. For this reason, this is why I'm urging caution in jumping into shorts, I would start entering them, but one more day down would make me a lot more comfortable about really adding substantial positions.

Follow UP on XLF-Cat's not Quite Out of the Bag

Photo courtesy of psyberartist

While I think the action in the SPY and the QQQQ is suggesting a reversal as well as the XLF, we need to be patient to see the end of day close.

The 1-minute 3C chart is suggesting a bounce in XLF

Here we see the a.m. range broken-bearish

Here we see the lows of Friday and Thursday taken out, a close below would serve as excellent confirmation, especially if the other averages do the same.

Finally our 30-min chart is moving toward a positive divergence which could set up a bounce.

Basically the trading pattern we have, even with a close below Thursday's low, is still a swing trade setup for a long position on a move above today's high-should we get the close we are looking for. This means it's not a bad idea to start adding or adding to shorts, but to be cautious for the moment in doing so.

A New Resource For You

Photo courtesy of parislemon

On the left sidebar of the site, if you scroll down you will see a section called "Resources and Concepts". Under this section you will find links to past articles that may be helpful and I have just added a link to the best chart I've been able to find for the Baltic Dry Index, which has seen a lot of interest lately, especially since Cramer talked about it at length on his show.

The index basically tracks the shipping rates (or demand) that are charged for dry goods such as coal, rice, iron ore, etc and is seen as a leading indicator of future economic expansion or contraction. Unlike airlines which can simply park planes (mostly in the Arizona desert) when demand diminishes, Dry ships, regardless of demand, are rarely taken out of circulation because of the extraordinary expense of producing them and the build time for a new ship is often 2 years or more. In other words, the index tends to be very volatile as the number of ships is relatively fixed (a new one can not be produced quickly with a transient spike in demand). Also the index is considered to be one of the few leading indicators that is truthful as a ship needs to be booked for the rates to move. Other leading indicators are often revised, are arbitrary (such as consumer confidence) and most likely otherwise manipulated in some shape, form or fashion.

On this chart provided by Bloomberg.com, you can see a rise or positive divergence in the yellow Dry Index vs the SPY, right now it appears to be in a negative divergence.

I may add more specific charts such as the  HARPEX which is a measure of container freight or a breakdown of the 4 classes of ships used in the Baltic Dry Index, (from smallest to biggest) Handysize, Supramax, Panamax and Capesize. Each is understood to carry a certain net percentage of Dry goods shipping and there is valuable information in understanding which are seeing the most demand. Furthermore, to some extent, the type of goods being carried can be determined as Rice cargo has significantly different implications then Coal or Steel/Concrete. We'll see about that if I can find good charts that allow us to gain information.


For now, enjoy your new tool in market analysis.

XLF -Financials

What's behind it?

3C 1-hour negative divergence

Almost-it needs to penetrate a little deeper, but I think the implications are the same.

A faster 3C on a 30 min chart with a serious negative divergence, actually the worst kind as it (3C) makes new lows it has formed a leading negative divergence.

My new PVR indicator based on the closing price/volume relationships (4 possible relationships)-I use the most bearish and most bullish to construct the indicator. As you can see, it has called all of the reversals and confirmations.

4 C with a very negative divergence

Weekly chart of XLF with a trading range and what appears to be a false breakout

3C on a 3 day chart

My newest version of a Price/Volume indicator in StockFinder

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The SP-500 and the SPY A Tale of Two Charts

Photo courtesy of sophiea

I was asked today, "Divergences (daily) can go on a long time, how do you know when to act?"

This is a great question and many people see a daily chart of 3C with a negative divergence and price continuing higher and assume that the indicator does not work. However, think about the situation-smart money is distributing, selling off their inventory most likely accumulated at lower prices. They to have large positions and can not sell them all at once like we do when we exit a trade, so they must sell in smaller increments and 3C picks up on this selling by smart money that is in smaller increments. 

If you have a distribution on a daily chart it simply is saying "they have begun their selling and/or shorting". To determine the time in which they have rid themselves of all inventory-distribution is over and a reversal is at hand, you must watch the intraday charts and when all timeframes start to line up with negative divergences, then you are very close. Here are the S&P/SPY charts 3C and others (click on chart to enlarge):

I had to use SPY because the index itself doesn't give me intraday volume until the close-1 day, confirmation of the uptrend.

One hour, negative divergence

30- minutes, negative divergence

15- minutes, negative divergence

10- minutes, negative divergence

5- minutes, negative divergence

1- minute, negative divergence

S&P 500 daily, negative divergence

Brand new cumulative Price/Volume Trend for StockFinder-S&P 500 daily negative divergence

Same, just a closer look

SPY daily negative divergence

Same just a closer look-note Red=Price Up and Volume down (most bearish), Green=Price Up and Volume Up (most bullish), Orange Price Down and Volume Up-could indicate panic sellers and Yellow Price down and Volume down-doesn't say much-typical of bear markets.

They all lined up today and thus far we have a candlestick pattern developing which looks like the reversal pattern called "Dark Cloud cover"

If you like to Try any of my proprietary indicators for TeleChart or StockFinder-both of which you can see above (Price Volume relationship indicator and 3C), simply click on the links for either and let them know Trade Guild sent you, then just email me at Brandt@Trade-Guild.net

Charts, Charts and More Charts....

I'm posting tons of charts at Chart.ly Subscribe to my Twitter feed to see them

Introducing PVR, as Applied to AAPL

                            

         Photo courtesy of ell brown                                   photo courtest of  The_Admiralty                      photo courttesy ofsoundlessfall          

This is the debut of my new PVR indicator. I've been using something similar on Stockfinder and now it's available for TeleChart. I've also been using something similar to track the entire market by each market average, dominant price/volume relationships. However, PVR is designed to work on a single symbol. This indicator has nothing to do with 3C whatsoever, but I have noticed similar divergences in the testing and comparison. Take a look at AAPL below through multiple timeframes. The divergences are a little more complex then 3C.