BarroMetrics Views: S&P Revisited 2009-08-25
The S&P has a seasonal tendency to form an 18-day or 13-week swing high in late August to early September and move South until the first or second week of October. Since July gave a 12-month Negative Development Buy, if a high does occur, I’d expect it to be a 13-week high.
However as Figure 1 shows, there is no 18-day change in trend pattern on the horizon. If we see acceptance below 1013 (basis cash), we will have a 5-day Upthrust Sell but all that gives us is an 18-day line turn. That being the case, unless the patterns change, I’ll be sitting out on this sale and will be awaiting the buy in October.
If you are a 5-day swing trader, the signs are there for a top:
- The Market Delta Charts show that as the ES has headed higher, the responsive seller has been taking control.
- The Normalised Volume chart shows that as the ES has headed higher, the volume has been dropping.
Both factors are bearish.
FIGURE 1 5-d and 18-d Barros Swings
FIGURE 2 Market Delta EOD
FIGURE 3 Market Delta Split
FIGURE 4 Normalised Volume
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