29th Aug 2011–My Analysis

BULL or BEAR ??

 

Short term (1 week)	Long term (1 month)
-- Expect the rally to continue for a week. -- Indexes showing bullish weekly candle formation with support at 200MA line. -- All sectors and USO are showing sign of stabilization. -- FXI also show sign of stabilization at 35. -- Baltic Dry Index shows a lot of improvement to my surprise. -- The rally can be short !	-- Look for the handle part of theVXX cup with handle formation. This is very dangerous. -- The temporary rally may not last. -- Watch out for the FED announcement in month of Sept. -- MACD of all indexes already below zero line.

 

Next Week Economic Data:

 

 

Input:

 

1. There should not be much surprise data next week.
2. This should help to bull to charge the market next week.

 

VXX chart:

 

 

 

Input:

 

1. This VXX weekly chart definitely tell a lot of bad news. It has a very BEAUTIFUL but DANGEROUS parabolic shape. Bottom could be in place for 3 months already.
2. Extreme high  volume for the past few weeks.
3. It looks like forming a cup with handle, a text book pattern that has very high potential of higher move in the near future.
4. Be very careful of the weekly 50MA line.

 

SPY chart:

 

 

Input:

 

1. Weekly 200MA line provide a good support.
2. Weekly 100MA line is now its resistance line.
3. MACD start dipping into 0 line. This is not good.
4. Previous weeks trading volume is equivalent to the high volume crashed in 2008.

 

DJIA chart:

 

 

Input:

 

1. Support at 200MA line and the trend line.
2. MACD start to dip into negative zone, this is not good.

 

NASDAQ chart:

 

 

Input:

 

1. Similar to DJIA

 

UUP chart:

 

 

Input:

 

1. We still need to see how UUP react after coming out of the triangle.
2. This will show where the market and GLD is going forward.

 

Sector Analysis:

 

 

Input:

 

1. Sign of stabilization across all sectors. Good sign for bull.

 

GLD, SLV, Petrol and Natural Gas charts:

 

 

 

 

 

Input:

 

1. Weekly charts of GLD and SLV show that they are both getting weaker.
2. Petrol USO is showing sign of stabilization.
3. UNG coming to another triangle formation. Its MACD looks like more potential to the upside. It is at the all time low again.

 

FXI (iShares FTSE / Xinhua China 25 Index Fund) chart:

 

 

Input:

 

1. Weekly charts of GLD and SLV show that they are both getting weaker.

 

Baltic Dry Index chart:

 

 

Input:

 

1. Very encouraging sign from the Baltic shipment chart.
2. Not sure how well it can sustain and not sure whether does it really going to represent the pick up of international trade, but definitely it is a good move.
3. Refer to my previous post on Baltic.