Objective Trader

T R E N D S

The Trend is your Friend :-)

I spare you trend lines as they exist to be broken !  Price counts and money flow whether in- or outflow is important. Trend lines might assist in guessing a next target but they are not to be used to determine a short entry or any sort of top guessing activities.

The TREND IS UP 

Short & Intermediate Term

A pullback is due despite the fact the Daily SPX Chart shows no sign of a sell signal yet That being said, the NYSE Summation already signalled us a pullback with the sell signal. However, the trend as per montly chart shown above remains intact. 

Dow Theory 

Transport and Utility have not really lifted off the 50 EMA and show some small divergence to the Dow Industrial.  INDU is a bit too much away from the 50 EMA and it would be healthy for the market to test the 50 EMA or turn just above it.

 

Summary :

Perma Bears need to realize that the Dow and Nasdaq already surpassed the May 2011 highs. Anyone who is also checking Sector Charts can see many of the sectors made new highs too.

How can that be bearish ? This is a bull market !  

Indicator Review 25 Feb 2012

The previous article showed NYSE TICK and we just discussed the sudden spike to over 220 ( grey shaded line ) and red line moved to 150.  This is considered short term very overbought.

I place 2 red arrows on the spikes in NYSE Advance-Decline Chart. Needless to say what happened next as the charts speaks for itself. We do already see internal weakening !

Back in September below S&P500 Percentage of Stocks above 50 & 200 DMA was shown AND the BUY ZONE was highlighted. Well, it was an astonishing rally for our OT members. Now we are wearing the prudent cloak and we are cautious. Having scaled down some longs is the right approach.

 

There is a time to be very bullish when indicators speak for themselves and when Perma Bears shout the loudest. NOW, the indicators gives us hints of being cautious and the Perma Bears are quiet and depressed watching the market in disbelief.  WE DO NOT NEED MORE HINTS !

 

NYSE TICK & SPX Hourly

NYSE Tick is in overbought territory whereby the red line has still room

 

SPX 40 Day Hourly Chart is showing us that the 60 EMA has held very nicely and is as usual the area for a day trade to enter long in an uptrend. 

That being said, the Summation Index is not giving us positive signs at all and the market has gone in past days nowhere.

Silver Review

Last year in April it was pointed out that Silver had risen to a parabolic level

Click -> Tale of Silver and the Sleeping Bear

Click -> Silver Bear Roaring

 

Well, the fear was justified and we saw standard procedure of retracement levels. We nearly correct 62%  and the level stated in other articles was 27/28 USD entry for longs.

Silver Weekly is looking again bullish and I think once we break the tougher resistance of $ 38, we are back in a full blown bull market. The weekly chart does not indicate any bearish scenario and longs should be held in Silver. New All Time Highs are just a matter of time.  

 

 

Mining Sector - More Rally Ahead

The HUI - GOLD RATIO remains oversold despite the gains of past few trading days.  Assuming that the ratio would move at least until 0.34 and considering Gold price will climb higher too, the rally ahead might be significant. Gold Stock remain undervalued and probably the last good entry traders will have.

Bullish Percentage in Mining Sector was extremely oversold. There is lots of room towards 80-90

HUI  combined with GLD Weekly Chart is looking bullish