Saturday, March 08, 2008

Qs Weekly Update and The Man With 3 Balls

Upper charts are daily, weekly monthly 3 linear regression studies (30,11,3). All the charts are technically negative at this point and with the latest jobs report and other discouraging financial news coming out, I think it's going to take some doing to get this market in an upswing. Friday's swing low through January support levels is probably not a bottom, though I suspect we may see some lateral consolidation for a bit before the next leg down. I've mentioned this many times before, but if you think the market's way oversold, then check out the monthly bars.
The 36-37 area still looks like the next support level.
Above is a chart of the NDX (QQQQ) stocks above their 200 DSMA (as opposed to yesterday's post of NDX stocks above their 50 DSMA. This chart is considerably more bearish than the 50 day as its clearly displays the ongoing deterioration of the Qs base despite occasional rallies in NDX stocks to the 50 DSMA. Although extremely extended readings like these are typically regarded as bullish, the current economic/political milieu is very unique and until we get a break over the 50 DMSA line, I'm sticking with the "sell the rally" mantra. I think it may take a few days for the markets to digest the implications of the latest (bad) economic news, hence the suggestion of the lull before the storm.

Above is our little friend the VIX, in daily weekly and monthly linear regression garb. As with last week's rendition, the chart formations are bullish (which doesn't bode well for the markets, short term). If you've read my previous posts on the VIX the arguments for a continued rise remain unchanged.
Finally, if you've stuck with me this long because you were hooked on the guy with 3 balls tag, here's a piece to show how much fun you can have with a minimum of equipment:

No comments: