BarroMetrics Views: S&P 2010-09-13

I posted video version of this blog on the weekly service. But since I consider the subject an important one, and not all my readers subscribe to the videos, I am repeating my views here.

Summary:

  1. We have a high cycle window due Sept 8 to Sept 16 with the preferred zone being Friday Sept 10 to Tues Sept 14.
  2. We are in a possible resistance zone (78.6% to top of Primary Sell Zone of the Value Zone) with the preferred zone being the Value Zone’s Primary Sell Zone - see Figure 1.
  3. As the S&P has headed higher this week we have seen ranges of 11, 9 and 7 while volume has remained ‘normal’. This is bearish - see Figure 2 (ranges) and Figure 3 (volume)
  4. Friday was an inside day. Basis Dec, acceptance below Thurs’ low (1097.75) will indicate the start of a down move into the Seasonal Low due Sept 25 to Sept 27. Acceptance above Thurs’ high, Basis Dec, (1106.50) suggests a move to the Primary Sell Zone in Figure 1. Figure 4 shows Thurs’ range Basis Dec
  5. I’ll be looking for a sell signal on the Monday. The least attractive sell will be the close of an end-of-day bearish-conviction bar below Thurs’ low. I will be seeking also to enter a position on a short intra-day basis if a setup and trigger occur.
  6. The trade will carry 1/4 normal position size as I ease into trading after a break.

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Figure 1 S&P Cash Primary Sell Zone

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Figure 2  S&P Cash ATR

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Figure 3 Normalised Volume

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Figure 4 ESZ0 Thurs Range

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