September 28, 2011
Uncategorized
By Geoff Bysshe
I’m sorry I missed this, but now this post will serve a reminder for me, and you, to pay attention to the simple market messages that can make a big difference in your P&L.
Despite the dramatic under performance of the XLF vs. the SPY on a daily basis, on an intra-day basis they have moved in synch when you compare new intra-day swings and relative performance vis-à-vis the O.R. You’ll find this to be the case over the last several weeks at least. The conclusion I draw from this is simply that any significant intra-day move in the SPY should be accompanied by the same relative move in the XLF.
Today this relationship indicated the late day weakness in the SPY, DIA, IWM and QQQ was not going to bounce back. This was apparent when the XLF’s failed for the 3rd time to confirm a new high for the day when the SPY’s and other markets moved to new intra-day high. And to further confirm that bulls had run out of gas, the OIH has maintained a similar intra-day relationship with the SPY’s, and it too diverged dramatically all day.
Whether you get your short /exit signals from any of the 5-min candle patterns, moving average patterns or Opening Range patterns that we teach, they were all there. See the charts below.
For Tomorrow…
The longer term metrics, phase and daily MA’s, are negative and the shorter term metrics, pivot stack and 3-day pivot bias, are positive. And the daily charts sit basically in the middle of their respective ranges. Reversals will probably be the best play unless the markets start with a very narrow O.R., or one that lines up nicely with either end of today’s range.