Today was quite impressive for the bulls. A public post at the site showed the SOX coming right to its trend line. I day traded LSCC for a good profit today and would you believe I actually had to remind myself to take the profit? Seeing the SOX at the trend line helped get me going, after letting some profits turn to losses by not being decisive in this market.
More charts for your review…
The BKX (from NFTRH 290) has not fixed itself yet.
BKX vs. SPX clings to support. But it is still significant in that it made a lower high and lower low in a divergence to the market.
Biotechs surged to the sharp downtrend line on the weekly chart. Daily BTK has a somewhat bullish looking pattern, by the way. But this momentum leadership index has more work to do to fix itself. I have been playing around with specialty pharma’s here and there, but trading quickly on them.
Russell 2000 popped above the trend line. The short covering here may have been intense. It would have much work to do to become bullish again.
Dow broke the top line of the bullish Ascending Triangle.
S&P 500 has not really changed. The scenario continues to look like it can grind up bulls and bears on any given day.
NDX has no real change either, as the area at and just above 3600 is the decider on bull or bear going forward. I’m still trying Google for a bounce and trading tech long and short as needed on a very limited basis.
VIX got driven down to the support we had noted. Score one for complacency.
(NFTRH+ idea) Separately, with reference to last week’s ETF update noting a potential (and lower probability) bottom pattern China’s FXI, the pop on some fundamental news about China’s market reforms helped that case a bit today.
As you know my preferred vehicle is the Mobius managed Templeton Dragon Fund. So the below is an idea for anyone still bullish on China’s prospects or for a swing trade. TDF broke out of a consolidation today. The ‘stop loss’ is the support zone.
Bottom Line
While this was a really good bull display, not much of anything was altered. The bullish items remain the DOW and the TRAN while the momentum leaders that have gotten hit badly over the last few weeks are bouncing hard. Meanwhile, the bearish divergence by several indicators remains in play. The VIX by the way, is not bullish. It just shows that anxiety is continuing to come out of the market.
So today did not change much of anything, but it did reinforce the idea of being nimble with this market (until it shows its hand) if you choose to play with it. I cannot see much above that became more bullish today in any meaningful way. If things do go bullish we will note it and go with it. We will continue to watch the Semiconductors, among other things.
