The most recent Green Period produced a 38 point gain on the Nasdaq.
16 of the last 18 Green Periods have now been profitable.
Check out our performance page for a complete overview.
The market remains at a very interesting juncture.
The Nasdaq tested the 2700 level, as we expected, but that level was not decisively broken to the upside.
We remain stuck at the overhead resistance from a long term trendline.
Here is the current chart for the S&P 500 Index (click for full size image):
As you can see, the market has been trying to break out, but is stalling right on the trendline.
If we fall back from this level it will qualify as a failed breakout, which usually results in a strong move to the other direction.
With a Red Period now starting this becomes the more likely scenario.
We also see that the market momentum remains weak despite the new highs.
So we can only repeat last week’s advice: take profits and/or protect your portfolio with some put options.
If a downmove starts then the first target becomes 1240 on the S&P, next 1180.
Good luck, Danny
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This entry was posted on January 9, 2011 at 6:29 pm and is filed under Market Commentary.
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LunaticTrader
Outlook January 10
Posted by Danny on January 9, 2011
The most recent Green Period produced a 38 point gain on the Nasdaq.
16 of the last 18 Green Periods have now been profitable.
Check out our performance page for a complete overview.
The market remains at a very interesting juncture.
The Nasdaq tested the 2700 level, as we expected, but that level was not decisively broken to the upside.
We remain stuck at the overhead resistance from a long term trendline.
Here is the current chart for the S&P 500 Index (click for full size image):
As you can see, the market has been trying to break out, but is stalling right on the trendline.
If we fall back from this level it will qualify as a failed breakout, which usually results in a strong move to the other direction.
With a Red Period now starting this becomes the more likely scenario.
We also see that the market momentum remains weak despite the new highs.
So we can only repeat last week’s advice: take profits and/or protect your portfolio with some put options.
If a downmove starts then the first target becomes 1240 on the S&P, next 1180.
Good luck, Danny
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Like this:
This entry was posted on January 9, 2011 at 6:29 pm and is filed under Market Commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.