Downright ugly!

This is one fucked up market..IMHO.  Just a bunch of chaos.  I guess its cause there are a bunch of computers playing against each other with algorithms that are based on human nature, however, the humans are becoming more and more absent from this whole mess.  down 165 yesterday up 130 today.  WTF??   trendlines are broken then broken back again.  20 min indicators pointing up while 60s and 5s are pointing down.  I guess its simply not time to trade.  I'm hanging it up for a while until this nonsense subsides.  this is bullshit... probably a reflection of the fucked up mass consciousness in this country.

Some bearish signals happening

SPY RSI uptrendline broken today, along with the SnP 60 min. trendline.   Market stopped at the 200 week moving average and turned down.  DXY stopped its descent at trendline support 76.14  and big up candle today, way due for a bounce.  McClellan Osc. bearish divergence and has turned down at down trendline.  VIX bollinger sell signal was 3 days ago and these usually can take a week +-3 days to manifest the selloff.   IFT total buys vs. sells has been building a bearish case for a while now.  52wk hilos although choppy has turned bearish.   My 60 min relative strength indicator has turned down (small caps leading the drop)  but the daily has yet to cross bearish.  60 min LRCs are all in sell mode and dailys are headed that way .. whether this is a good correction is still yet to be known.  Also after these parabolic rises in gold, AAPL, EURO etc .. this market is way too frothy and overbought.  I think its time to get positioned for a downswing.  The financials, small caps and R/E could be shorted here.  FAZ, DRV, TZA.

Is it time to stop paying the mortgage all together?

here is a great article from zerohedge detailing the whole mortgage mess, how it got there and where it stands now.  The banks are totally vulnerable to a homeowner revolt by just stopping payment and asking for proof that the bank owns the note.  http://www.zerohedge.com/article/gonzalo-lira-second-leg-down-americas-death-spiral

Dow screaming past 11,000 ... Happy Dow is here again!

"About three dozen of the top publicly held securities and investment-services firms—which include banks, investment banks, hedge funds, money-management firms and securities exchanges—are set to pay $144 billion in compensation and benefits this year, a 4% increase from the $139 billion paid out in 2009, according to the survey. Compensation was expected to rise at 26 of the 35 firms." WSJ

Now a buy signal!!

Talk about being whipsawed.  Now the RelativeStrength indicators both daily and 60 minute are pointing up.  I probably should bail on all shorts and switch to long, but the market seems so overbought, the SnP stopped just above the 1160 target, which is also slightly above the 100% fib projection ... well maybe more than slightly, next projection would be 1202 ..hmmmm.  The RUT just slightly exceeded the 61.8% fib retracement and at some resistance 690 area.  ???   Geez, confusing as to bail or look for a pullback from here.  TZA has broken down to new lows.  the ETFs drop way faster than they go up.  While Rut high this year was 746 and its now 689!!  and TZA at all time low??  Whats up with that?

Plus all the LRCs for 20 min, 60 min and daily... are all pointing up.   Should I jump on board the bull train at these lofty highs or just stand aside after closing all loser shorts??   This market is incredibly difficult to figure.  Its all about the Fed pumping cash into the economy with its POMO.  Why can't they just leave the markets to find their own balance?

Sell signals again today

Lots of 60 minute sell signals for the market, including the RelativeStrength mentioned in the previous post, now fully in sell mode on a 60 min basis.  Daily in all cases has not broken to sell yet.  Lots of chopping around today in the afternoon.  Faz for a week now has been directionless chop crap.  TZA/TNA were all about straight up, straight down routine.. must be heavily traded by the HFTs

Mixed signals

this market dips into the 1150's then immediately falls back into the 1140s.  I am getting all kinds of opposing signals.   the 1150's is an area of resistance plus the market has been up for a month now so its hardly prudent to buy into this, on the other hand, many technical analysis methods have not been working lately.  The market seems to even go up on bad news.  56% of the volume is from HFTs, with only slightly over 10% from retail investors/traders.   So the direction it goes is not the result of mass psychology but instead the result of algorithms programmed into computers that profit thru huge trades on minor moves.  It kinda makes me sick.

At any rate... here is a new indicator that I find quite usefull and it is pointing to longer term continued bull moves, possibly after a bit of a pullback first.   The smaller caps seem to be leading the big caps therefore this is the relative strength between the SnP vs. the Russell 2k.  As the ratio goes up the market goes up and as it goes down the market goes down.   Russell moves up faster and down faster than SnP.

This first chart is on a 60 minute basis.  I am using a 21 period linear regression curve vs. an 8 period exponential moving average of that.  The lite blue is the LRC and the yellow is the ave.  The red is the actual Relative strength number.  Right now it crossed bearish lite blue crossing below the yellow, but the red has crossed above, which usually pulls the lrc and lrc mav.  so the yellow may have changed its mind.  On the other hand, with LRCs, generally when there is a trend change, the price (or in this case the relative strength number) pulls back to the LRC ave before continuing on down.   Its a bit confusing at this juncture.

The next chart is on a daily basis.  Now this simply uses a 10 and 50 exponential moving average of the relative strength to smooth it.  You can see the market has been in a down channel since mid May, confirmed by the 10 staying below the 50.   Now, not only has the 10 crossed above the 50 but it has also broken out of the channel.   this would tell me that there is a new leg of this bull move coming soon.  I am looking for the 60min to work its way down a bit maybe 2-5 days, close my shorts then move to long unless the daily falls back into the channel and the 10/50 cross back bearish.

With this next weeks unemployment numbers hopefully the market will get out of these doldrums and do something trendlike.