Wednesday, April 28, 2010

Some Cracks in the Seams

Above, the 4 square chart of weekly bars with the VIX/SPY and VXN/Qs, and it's hard to tell these 2 sets apart. Short term mid-panel technical implications are bullish for the VIX/VXN and bearish for the SPY/Qs although the SPY/Qs continue to ride the LR30 mean upslope.
Below is a pattern that is becoming evident with an increasing number of the majors. In this case it's shown on the EEM, which was surprisingly weak today, spending a good portion of the day in negative territory but closing in the green. The white circle captures the erosion of new highs also seen in the Qs, SPY, SMH and IWM (to a lesser degree).
We got the widely expected knee-jerk pop in the majors today after yesterday's 30% rise in the VIX, and although volume was enthusiastic, buying was sporadic and failed to make any significant intraday pivot swings.
The VXN Matrix opened at 28:8 positive = Qs bearish, but the Qs downdraft only lasted 2.5 hours and closed the day at 18:18, a distinctly neutral position.


Jeff Pietsch CFA said...

Cracks, what cracks? Whose on crack? First, the Kraken?

bzbtrader said...

Dear Mr. Pietsch,
I believe your possible excessive inhalation of cantor dust may have seriously effected your autonomic nervous system and reasoning skills.
Like Charles Dickens' Mr. McCauber I'm expecting something to turn up momentarily. .in this case a market pullback. The fact that I'm a wee bit premature in tagging such a turnaround should be no cause for your derision.

jgpietsch said...

Cracks in the seams -- as long as Mr. Market doesn't bend over, todo esta bueno, no?

bzbtrader said...

Dear Mr. Pietsch,
I'm worried about you as you seem to be speaking in tongues and digressing into foreign dialects. Such behavior is often symptomatic of a possible Tourettes-Barre affliction, and has been found in more than a few island-bound alpaca ranchers.
Hoping for your speedy recovery.