Wednesday, April 6, 2016

The Top is In !!

 


Surely you are laughing at the headline, The Top Is In!!!  But in my work, it's worthy of adding to my Two Time down position on the SP 500 (ticker SDS). 

Failed three period tests normally indicate a top or bottom but in this crazy world of Fed manipulation, can anyone actually make an accurate prediction?

Sure, the guys (and gals) working at the Fed trading desks.

But today's action, a sharp rise that occurred when one of the Fed Presidents, Bullard, famous for several previous Fed rallies, got on tv and jawboned the market.  Don't quite know what he said as that's not as important as the SP failing to take out the high set three days ago.

Supporting my call is declining momentum in the 20 day moving average.

 
 


This indicator actually provided me with a great buying entry point.  Notice the underline at the three period test of the low.  Now we see, that while the moving average is still positive, it is now losing steam and a significant down day would push it back into negative territory.
 
A review of other world markets show that many of them are already down significantly from recent rally highs.  Just the US continues to maintain so well.  Whether it is because the US is the cleanest dirty shirt in the hamper?  Or if it's Fed manipulation?  Or what?  It's no secret that corporate earnings will be down this year and even GDP will be lucky to eke out a positive number. 
 
Oh yah, the market looks out six months ahead.  So if you believe this market, you can be expecting nice raises and great job offers allowing you to cash in on the growing economy.
 
Well, if you don't agree with that, perhaps it's time to lighten up significantly on stocks.  The next move down is sure to be a doozy.  Don't leave your accounts unprotected.

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