November 27th, 2007 richk
Yesterday volume was small. I expected it will increase after holiday week.
Also there are no big buyers on markets right now. So it looks like markets will go down. Nasdaq broke 200MA, Dow and SP500 are also on their track down.
I expect Dow is now on the track to the 12000 points support level and Rusell (Small cap) to 700 points. I would like to short these two indexes in case they will provide some bounce. I will use Short style ETF like DOG, RWM or DXD, TWM
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November 8th, 2007 richk
Finally stock markets broke minor supports from last two weeks. And started second leg of downtrend move. As I expected in my last posts, they are now in direction to important support areas. I described them in this post few weeks ago.
SP500 also breaking down important 200MA. This is bearish signal for stock markets. Dow is close to 200MA too. Only Nasdaq is well positioned above 50EMA and 200MA.
If you are looking for new long trades, watch stock with really big relative strength. List of stocks in Nasdaq-100 index is good way how to find some good candidates.
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October 20th, 2007 richk
I noticed several times that volume during rally days is much smaller then average volume. And also during last week the volume accompanied with selling was much more higher. You can see this on charts below.
I made stock market index chart analysis today. Nasdaq already touched its support area. SP500 and Dow Jones have some space for further decline. So I expect that selling in SP500 and Dow will continue till these indexes will come into these support areas.
If there will be some bounce on Monday , it could be good opportunity to enter some short trade in SPY or DIA (Index ETF) or enter longs in “short” ETFs (like DOG or SH) or “Ultra short” ETF (DXD or SDS).
Volume and support areas you can see on charts below.
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October 16th, 2007 richk
I have noticed bearish candlesticks on charts of leading Nasdaq stock market sectors. You can find there bearish negative candles with long body (GOOG chart) or candlesticks with long upper shadow with small body in lower part (Biotechnology ETF with symbol XBI or IBB).
There is also higher volume accompanied with yesterdays selling on Dow Jones Industrial index, S&P500 and also Nasdaq stock market index charts.
Also Semiconductors went into negative territory under 200MA. They are weak and formed bearish head and shoulders pattern. This 200MA together with gap area between 36.60 and 37 created strong area of resistance.
So I plan to short Semiconductors ETF (symbol SMH) if it will break down under 35.90 (Fridays low) with possible target near 34 area.
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October 12th, 2007 richk
It already came yesterday. High volume profit taking. I noticed that big investors (funds, asset managers) have not been buying during last rally . I think it because high volume was missing during last days. I noticed it a few days ago already so I was not so aggressive in opening new long trades.
Big boys started to unload their holdings and sell into strength of last rally. High volume during yesterdays afternoon selloff is sign of that.
I must say that I am happy that this selling came. This rally lasts too long. Prices must go down a bit to allow me enter new low risk long trades. I monitor some stocks and will probably prepare some long setup during weekend. I expect that some selling will come today too. Major stock market indexes are too far from important moving averages.
There are some stocks with relative strength. They acted well yesterday and I expect they will act good today too. JDSU, VRSN, CSCO, BRCM, JAVA, MYGN, ETR are stocks I will monitor closely for possible new long trades. I made nice profits on MYGN, BRCM, ETR trades during last weeks and re-entry into these stock can offer new profit potential. As long as they will stay in their uptrends.
Current correction could move Nasdaq to support area near 2700 point. See chart below. There we will see if this support will hold and allow uptrend to resume. Or if something like deeper market correction is in front of us.
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October 6th, 2007 richk
I analyzed stock market index charts. And I noticed that there is divergence in volume for SPX (SP500) Index and Dow Jones Industrial Average Index. It could be sign of overbought conditions and possible correction ahead. Only Nasdaq is going up with relative strong volume.
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