I took a trip to Tarpon Springs on Friday morning, with every intent to return in time for an early afternoon post, but got tied up and did not return until near 5:00pm. My Bad!.
Lots of news over the week end, mostly regarding escalating violence in Libya, with a side story regarding Portuguese bond wides and the nearing Irish elections. Oh, and growing public anger in Wisconsin at the Governors attempt to eliminate Collective Bargaining rights for Public Employee union members. Oh, wait... growing doubts the Federal Budget can be voted without a government shut-down. Premarket trading in the Dow has the index down 80 points, and Gold up 15 and silver over 34, and oil trading over 91. European indexes down 1.5% to 3.5% .
Lots of go-juice to pour on the U.S. markets Tuesday morning when they open again for trading. Could be another No-Volume, "Bad News is Good News" POMO financed melt up! But, then again, it will be Tuesday, not Monday which has had the year-long reputation of being the best Buy-in-the-morning,-sell in the-afternoon trading day.
Our Proprietary Momentum Change Indicators continue to function with the Sell signal first generated 1/20, confirmed 1/28 and still in effect. This does not suggest that new short positions should be initiated, however, it does suggest that long positions should continue to be sold into strength. We await another Sell confirmation to enter new short positions, or a new Buy signal, to initiate new long positions.
In the past week, I noted new short term Negative divergences in the NYAD 10 SMA, the NYAD 19 and 39 SMA, the McClellan, the Parker Sentiment indicator, the NYHL ratio, the NY New High, minus New Low, and the Confidence Indicator. RSI and MACD in the major indexes continue to demonstrate Negative divergences, and the much-watched Copper, which has been promoted as a bell-weather leader of the rally for most of the past 13 months has taken a decidedly negative turn since 2/14 and RSI for Copper is also taking a dive.
It will certainly be an interesting week for us traders, and we will see if the "Risk On" trade is finally about to ride off on the back of Northern African revolution and violence. Stirring the pot is a change of mind by the Irish, who may no longer be willing to play the "Bail Out The Banks" game with their national finances. Also news this morning that Germany's Merkel has lost a significant State election by over whelming majorities, demonstrating that the German people are done playing Santa Claus for the other ECB's (or St. Nicholas as the case may be)
Best To Your Trading!
Bill
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