Wednesday, August 1, 2012

Wednesday Evening

SPX Daily
The bears did a pretty good job of pushing the SPX right into the top of that high volume zone today (1355-1375). There are plenty of reasons to maintain a cautious stance on the bullish side here. I am currently long and slightly uncomfortable when I look at this chart. The first major level of support below is the 20day SMA at 1359ish.... assuming the bears can push that far. Below that opens up the potential for the 50day at 1339ish.... and then it's most likely a quick trip back to the 1310-1320 level. I'm holding my longs until I see the bears press a bit more, but will honor my stops if they trigger.

Wednesday Afternoon

Gold Futures (Dec) 30min
Gold futures trading has rolled into the December contract the last few days. The August & December contract have fallen back inside the triangle pattern and are testing 1600. The December contract is trading at about $3-4 above the August contract (soon to be expired)  - so the new number to watch on the December is 1613ish. The red line on the chart is the top of that daily timeframe triangle pattern.

Wednesday Morning

Gator's Chart of the Day: SP-500
Look familiar?  On Thursday we were at the bottom of the channel having completed the zag move on Wednesday.  We found the top of the channel Monday as we completed the latest zig move.  What now?  I'm expecting the expected and look for a continuation of the pattern with the current zag just beginning and headed for a meeting with the 50 day simple moving average.  Does this mean there's nothing to buy and the only move is to run to cash or even go short?  Not necessarily but starting positions now would likely mean a fight against the tide.

VSH Daily Chart
Here's one to keep your eye on.  Buffalo Springfield sang it ... "There's something happening here but what it is ain't exactly clear."

VSH missed earnings on in-line revenue and guided in-line but it popped anyway.  The P/E is only 7.5 and margins held up well so maybe that's it.  If so, it could easily see a move to 12.