Wednesday, May 19, 2010

BAC-up Time?

With the NYAD back down to .12 today things definitely looked dicey for the first couple hours. Yesterday's close was a bit scary as volume collapsed into the close and prices essentially froze. I say scary because those are the conditions that often signal an ugly end of day plunge. Instead we had a little rally at the open today AND THEN plunged . . a delayed gratification for short sellers . . a slow agony for the longs.
Days like today can be instructive if you keep track of what stocks/ETFs make the first break when the NYAD finally turns positive. BAC and SMH are a couple of nuggets that I've been tracking for a while and so far today they've both demonstrated some gusto.
The chart above is my spin on support/resistance lines as well as a 50% trendline that seems to be a historical turning point.
Below is Project Z's take on BAC with a 78% reliability over the past 16 months. Not exactly a barn burner, but that's 78% long and shorts with only 1 consecutive loser on both sides so, for me, that's a keeper. This is the signal as of 10AM PST today.
The linear regression lines are still convincingly bearish so I'm actually standing back on this one until I get some more confirmation of the NYAD slope really turning positive.
Meanwhile, GE, after a early slide, is back in the green and, as I mentioned yesterday . . that's good.

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