Tuesday, January 24, 2012
Strong Sell Signal in Place; Euro Slaps Me
Comments from Friday's post remain in play today. Volume today was extremely light suggesting major market players continue waiting on the sidelines. News-watching seems like a good choice since the wave count and momentum indicators suggest a sharp reversal at any moment. Maybe some Fed news will shake this market up in either direction. So be alert.
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I got so bored with this market I did not notice that the market's lethargy triggered and then executed a VIX sell signal. I only realized this after reading Steve Hochberg's Short Term Update from EWI. The daily close beneath the lower bollinger band, and then the later close above it, executes a sell signal. This is the most reliable timing indicators I know of. Usually a reversal in stocks occurs within 3-4 days suggesting a reversal will occur this week in stocks.
The euro stood me up, reached back, and laid a huge slap down on me.....I mean just a hard 5 across the eyes. I had a sell stop order almost right at the bottom this week which executed and then reversed sharply to a new high and stopped me out. I mean, I lost money and had the position closed before I even got up in the morning. Slap! But that's the game. There's a long reversal wick in place right now and 1.3050 should stop any rally attempt if a top is in and a head and shoulders pattern wants to unfold. My jaw still hurts though, so I'm waiting for more selling and a series of lower lows to get printed before I tackle this one on the short side again.
PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.