Friday August 10, 2012
Odessa, TX became famous in Friday Night Lights for a Mere $20M Football Stadium, now Allen, TX tops that with a $60 M stadium. It's hard to impress Texas high school students with most college facilities as a result. Recession, what recession....every thing's bigger in Texas.
At any rate, here is a look at where we are.
SPX
The green arrows indicate that the SPX has found buyers on every pullback since the move up from the June 1 low. I have suggested over the last week that this portends a break to the upside. I drew in the brown trend lines to show the upward channel. I stopped the lower trend line short of the right side of the chart so the up trends in every MA would be clear. The trend is up, the trend is your friend. IN the lower panel CCI has backed off the last few days as the market corrects sideways. Mr. Market is seeing if adequate buying will come in at this new higher level of 1400. If so that will support the move to the next higher level, readying for an assault on 1420. The fact that we have not had a deeper correction this time tells us that the totality of buyers are not willing to sell and take a short term profit, no doubt looking ahead at this potential break out.
TLT
TLT of course exhibits the opposite pattern per our Hourglass Theory. IN a period of extended stagnation, emotions fluctuate from embracing to rejecting risk. At 132 TLT indicated the crowd was rejecting risk even as the stock indexes were advancing. Since then money has flowed out of the Safe Harbor, or the safe end of the Financial Hourglass if you will. Not surprisingly just as the CCI indicator pulled back in the first graph, we saw a bit of buying in TLT, right at the 124 support level. that level held throughout June. But the 50 bar MA has turned down and the others are trending sideways.
Stocks are off in pre-market trading this morning, perhaps we nned one or two spikes down to really test the resolve of the recent buyers.
New Highs Lows
We will close with this picture of how the daily Highs and lows are testing all four MAs which have coiled handily right to this Market Perspective update. See the downtrend line coming off the July high, I did not draw it in as things can get too busy, but a break out to the upside will signal that things are really getting underway. Again look at the pattern of the multiple moving averages. Never mind what you are reading about the Euro or the Dollar or those whacky BMX riders last night at the Olympics (this is an Olympic Sport, really?) This is perhaps the last pullback before a big break to the upside. That will establish a new higher level of trading as suggested in the first chart.
A final up close perspective on High Low.
Thanks for reading The Market Perspective.
Comments