Monthly Archive for September, 2009

Published on September 21, 2009 in Uncategorized. 0 Comments

No real change as the markets completed in strong uptrend their 9th week of the current cycle. So, with entry this week into the 10th week we have to anticipate the end of this uptrend and the possible start of a retracement back down th escale a bit. We remain heavy with concern that we are facing a couple of weeks yet of no dramatic moves on the markets but which lulls us all into a sence of security which turns out to be false. In other words we cannot believe in just a gentle retracemnet and a continuation of the uptrend until October is out of the way.

But, then again, maybe we are just suffering from Monday morning blues….

Our new website and the addition of our new short-term ‘Trader’ service plus the revamp of our current service are all due to happen this week.

Stock Markets Review

Published on September 19, 2009 in Education and Market Reviews. 1 Comment Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , .


The current technical analysis of the-

  • FTSE 100, the FTSE 250
  • FTSE SmCap
  • S & P 500
  • DJIA
  • NASDAQ 100

ANALYSIS FOR THE PERIOD  – 6th September 2010 to 12th September 2010

The Overall Market Rating (OMR) , below, represents the percentage of stocks in each index in Stages 1 and 2 (a potential or an actual Uptrend);

An OMR below 50 indicates a ‘bear’ market and above 50 is an indication of a ‘bull’ market. (The figures in brackets show the OMR for the previous week) -

hisIn: Stage1 Stage2 Stage3 Stage4 Overall Mkt Rating
FTSE 100
 22% 20% 33% 25% 43 (43)
S&P 500
 25% 15% 26% 34  % 40(40)

The Overall Market Rating for the both FTSE 350 and the S&P 500 have swung away from being definitive indications of Uptrend to below the 50 rating and, as such, they now indicate a Downtrend and the possible start of a longer and steep down turn.

Identifying the Trend -diagram

Stage 1 - Accumulation/Stock Basing                           Stage 3 – Distribution/Topping out

Stage 2 – Uptrend/Rising Prices                                     Stage 4 – Downtrend/Declining Prices

Below, we provide two charts for each of the five market indices analysed. The shorter term (3+ year) chart allows easier recognition of some of the more recent features that we may comment on and then a longer term (8+ year) chart which shows the important highs and lows of previous years. We have provided longer term charts this week (up to 13 years) as it helps to illustrate the comaprative performance and absence of long term growth in the markets. Please click on each chart to enlarge.


FTSE 100 -   In a  ‘Stage 3′ Distribution/Topping Trend  – (selling or buying but great care needed) -

With an increase of some 226 points the index benefitted from some good  support last week and it now remains to be seen if this will lead to further rises in the coming weeks or if the support was but temporary.  The key support area remains as 5010 to 5350. If the index can stay above 5350 then the rally will continue and the trend should change back to an Uptrend but, if it falls below 5010 then (considerably) lower prices will follow. The bias of our analysis still suggests that the index is likely to return to the 4750 level area but, after the confirmation of support over the past few weeks the possibilty of a rise to the 6000 level is showing itself.

Chart (3+ year) -

Chart (8+-year) -

FTSE 250 – In a ‘Stage 3′  Distribution trend ( buying or selling but great care needed) -

This index has managed, so far, to stay above the support level at 9610 and last week it showed an impressive bounce up from that level. Importantly, it is staying above the level of its 30wk moving average which, itself, is continuming to slope upwards. This index is continuing to hold its own and, so far, has not succumbed to a swing towards a Downtrend but it is very important that the index stays above the level of its moving average. Should it weaken and fall below it then that could be the start of an eventual slide down to the important support level at 8888. But, in continuing to stay above it the index is showing that a rise to the 10,500 level is more than likely.

Chart(3+ year) -

Chart(8+ year) -

FTSE SmCap – In a  ‘Stage 3′ Distribution trend  (buying or selling  but only very selectively and care is needed) –

The index is still travelling sideways between the  support level at 2700 and the resistance level at 2910 as it has been for almost a year now.  If the 2700 support level should fail then this index is very likely to next visit the 2425 level to look for support there and could fall all the way down to the 2300 area. This index does not look strong; it is currently straddling (and testing)  its 30wk moving average (currently at the 2815 level). To rise above it will show sttrength and potential for further rises; to fall back below it will show weakness and potyential for a fall. Great care is needed as individual stocks may be difficult to trade at a reasonable price if a slide does get going. Even without a slide, this index is suggesting that little is likely to be gained from trading smaller cap stocks at the present time.

Chart(3+ year) -

Chart(8+ year) -

S&P 500 -In a ‘Stage 3′ Distribution?Topping Trend – (buying or selling but great care needed) –

It is a significant warning that the index is now, for the third time inrecent months, testing the strength of the resistance created by the important 1111-1122 area. If it can get above that area then it could resume an Uptrend but to stay below the 1111 level, especially after a third test of it, would be a signal of significant weakness and the propensity for a steep fall. It also continues to remain below the level of its 30wk moving average (which is now at the 1115 level) which signals weakness so the bias is still, at the moment, to the downside.

Chart(3+ year) -

Chart(8+ year) -

DOW JONES IND – In a ‘Stage 3′ Distribution trend – (buying or selling but care needed) -

Five weeks ago this index succeeded in breaking out above the resistance of the 10370 level after 12 weeks of trying but it then failed to find support to sustain the rally and it fell back below it;last week it mounted another attack at the resistance created by this level. It’s problem is that this index is still below the level of its 30 wk moving average as this indicates an underlying weakness.  There is potential for the index to rise above the 10370 level but to sustain that break, should it occur, it has to break above its moving average as well. Otherwise there is  potential for a bigger fall.

Chart (3+ year) -

Chart(8+ year) -

NASDAQ 100 - In a ‘Stage 3′  Distribution trend  ( buying or selling but great care needed) -

The rally up from the support of the 1740 level has taken the index up to meet the level of its 30wk moving average (currently at the 1877 level) to a test of the resistance there. Should it manage to break above it then higher prices would follow as the index should then rise towards the 2040 level but, should this attempt fail, then the price is likely to fall back sharply to the 1740 level.

Chart (3+ year) -

Chart (8+ year) -

If you have any questions or would like more information or would like to discuss market trends then do please email us at

sharehunter@btinternet.com

06/09/2010

Published on September 13, 2009 in Market Reviews. 0 Comments

The FTSE 100 is within less than 100 points of a serious test of the potentially strong resistance at the 5108 level. Indeed this rally now having lasted for the last 9 weeks we now have the potential for the (9-week) cycle to play its part and to hold down the index from any further increase and, later, to perhaps see it retrace back to lower levels.

The FTSE 250 has stormed ahead again; after a 2 week pause at the 8888 level resistance it has rushed upwards again and has hit its head on the resistance at the 9153 level – up 66.67% up from the March low.

Now, because of these overhead resistance levels and particularly because of the 9-week cycle that had, we calculated, to play its part, we have held back over the past few weeks from suggesting any new ‘buys’ as there would be no point in enjoying a short ride up only to get caught by a potentially sharp move down again.(*but see special note below). So, the question now is – were we right? Will the 9-week cycle play its part and send share prices back down again? Or will we end up with a lot of egg on our faces as the market continues to race away upwards? We will not have long to find out. This week’s market activity may be indecisive but the next week or two or three will show how right or wrong we have been. We remain concerned that October may visit some dire moves upon the stock markets. Frankly we hope that we are wrong as the potential for a disaster on the markets is real.

*Note, this comment is, of course, relevant to our current ‘long term’ (‘Investor’) methodology. With the advent of the new short term (‘Trader’ Alerts) service (which we hope to launch withing the next 7 to 10 days) there is potential for short term gains and less risk of losing profits via a sharp downturn (as an indication; the test ‘Trader’ service that we have been running for the last 10 weeks has produced over 35% growth on a CFD £20k account).

Published on September 6, 2009 in Market Reviews. 0 Comments

Unless there is a good move upwards this coming week the 9-week cycle in the FTSE indices that we drew yiour attention to last week may not now continue. In the event of lower close in the FTSE indices this coming week there is a greater chance than ever that the recnt rally will have run out of steam. Of course, there is still a chance that this has been but a temporary pause for breath by the market after a 7 week run up the scale but the real risk now is that the indices will move sideways in a consolidation for a few weeks before, perhaps, a two or three week fast fall back.

Our concern and attention continues to be the resistance levels that each of the indices is now testing. The FTSE 250 particularly has, for the second week running, failed to get above the important 8888 level resistance. The FTSE 100 is just a little below its resistance at the 5100 level and the SmCap index has failed for 6 weeks to get above its resistance at the 1415 level area.

In the US the Nasdaq 100 has stalled for many weeks below its resistance at 1630; the Dow is similarly stalled unerneath resistance at 9700 and it is only the S&P 500  that has achieved some progress but then it is only above relatively minor resistance at the 1000 level and is already showing signs that it is tired and likely to fall back below it.

So, we are left with three possible scenarios for the coming weeks; either 1) the markets take heart, increase volumes and push up through resistance levels and give us all more capital growth or                                     2) the weakness in the markets gathers pace, more selling takes place and the indices start what could become a protractred decline or                 3) buying and selling remains roughly equal and so the indices and stock prices neither gain nor lose to any great extent and so meander sideways for a week or two in preparation for a more definitive move, perhaps in October.

As of this weekend, our money is on No.3 as the most likely course.