Thursday Evening Thread

Russell Futures Daily Chart

This is a zoomed in daily chart showing the breakdown (812ish) from Fridays holiday session. Tuesday showed the heaviest daily volume of the June contract... which can sometimes indicate a reversal is near. The bulls stepped up and held that 780 level and have since produced an impressive rebound. There is major resistance above between 812-815... and I don't think a V-shape move back to new highs will be so easy this time.

Thursday Afternoon Thread

I thought I would continue with Gator's SPY chart for the day. There's good news and bad news. First the good news: The action so far today has been inside the Bollinger Bands for a change and we moved back above the 50 day average. Some individual stocks have set new highs including SBUX and CMG. Is there room for more upside? Well - those in the "all gaps will be filled" camp will be watching for the gap between 138.78 and 139.26 to be filled.

The bad news: See that rectangle. All the buyers in there are losers. Fitz talks about a "3 day rule" Smart money buys on day 1, not so smart money buys on day 2, and whoever's left takes the smart money out of the trade on day 3. Some market leaders, notably AAPL, are NOT leading today. Trade safe out there.

Thursday Morning Thread

Gator's Chart of the Day: SPY

Hurray we had an up day!!! After five consecutive red candles we have a green one!  We've been saved by that earnings powerhouse AA.  Now we'll see the "V" move back to new multi-year highs.

Wednesday was an inside day where the entire candle (even the wicks) was contained by the body of the preceding candle.  Volume was above the 50 day moving average but well below Tuesday's big down day.  Price never did get above the 50 day average and we closed below the 1370 level that many see as important.  It didn't even close inside the Bollinger bands.  (Bottom band = 137.10)

The market leaders like AAPL and PCLN were down and CMG and IBM closed near their lows.  I wouldn't even say this was a dead cat bounce.  Dead cats are livelier than this market.  The Beige Book report makes it unlikely that Ben will be acting anytime soon.  Besides, he needs to save a little something for a strong pre-election sprint. 

We may move higher from here but that could just be construction of a right shoulder and that would suggest a move back down to 127 or lower.  (Trust me on the neckline.)

This is the kind of action that can just chew up traders trying to build positions. 

In case you didn't recognize it I'll tell you that was the voice of experience.