The Line Is Drawn In the Sand In the Equity Markets

To many technicians, it is very clear where the equity markets will reverse, and for those folks who don't follow the technicals, this is a key reversal area in the S&P 500, the NASDAQ, and the Dow.

In my new short video I show you the exact levels that I think will reverse this market, if in fact it's ever going to reverse to the downside.

Currently the major trend remains positive for all the indices and we would only become negative on the these markets should the key levels I show you  today, are broken.

As always our videos are free to watch and there are no registration requirements. I would really like to hear back from you with regards to your thoughts on this video.

Your comments are welcome on our blog.

All the best,

Adam Hewison
Co-creator, MarketClub

20 thoughts on “The Line Is Drawn In the Sand In the Equity Markets

  1. I've put in a short for oil tomorrow (Monday March 15,2010) based on a spurt up and then a gradual decline in price. Let's see how it plays out.

    I'll probably do the opposite for natural gas within the next few days. It looks like it's ready to move up.


  2. Anyone interested in shorting oil might want to start thinking about it. Long-term is up, but might be a bit of a dip starting in the next couple days as long as no more geopolitical anomalies occur.


  3. I trade the major indexes so this "key level" advice is excellent. Please keep it coming, perhaps each month or sooner if you see a sudden change in market direction.

  4. Adam,

    Thank you for your updates. I guess the yield of bond market will tell whether central banks continue to print money? Do you think EU central bank will eventrally come down to print money just like Fed did? I guess they knew what they are doing, but if they have no other choices, then ....

    Your gold analysis show that they will have to issue more bonds and print more money; otherwise gold can not reach that high. Your analysis also show US dollar will go down dramatically in order to push up gold. This shows both EU and US will have bond problems next year. We will see, and time/market will tell.

    Thank you so much.

  5. I would consider keeping a lot of my cash out of this market. Some indices appear to be running out of gas...look at 5-year charts and indicators of each sector to see which ones are petering out despite showing higher highs.

    A trader should never be in the business of going all-in on a prediction. That's what economists do, and they all work for government and large companies where they don't have to put up their own cash. Does anyone know a rich economist?

    If things are fuzzy, stay out until a trend asserts itself. Then go in, short or long. Better to earn zero on your money than to lose.

    Or as one trader put it: "It's better to be on the ground wishing you were in the plane than in the plane wishing you were on the ground."


  6. Adam:

    Does it look to you like the DJIA might have put in a H&S on a 120 minute interval at the close today?


  7. Thanks Adam,

    I think these Chart Reviews help clarify the previous blog about all the indexes being bullish.

    I also think it's worth mentioning that if & when the Weekly Triangle turns Red,
    that is the time to go neutral, i.e., I will sell my SPY (using a stop loss at the price
    which triggers the New 3-Week Low) and wait.

    If the Weekly Triangle comes back Green with a score of +75, then I will buy the SPY again,
    but if the downtrend continues and the Monthly Triangle turns Red with a score of (-75),
    then I will go short the SPY using the SH.

    Your occasional review of these Indexes helps me to make sure I'm using the Triangles

    Day-trading isn't my forte.
    Buy & Hold cost me a big chunk of my IRA,
    so using the Triangles to trade the ETFs works nicely for my 63-year old brain.

  8. Adam,

    Do you ever look at the Dow Transportation Average or the Russell? These are known as market leaders aren't they? Looks like the Russell has been on a tear lately. How the market can stay up here with the P/E ratios the way they are I have no clue but the markets are always right. Take care and thanks for the videos.

    1. sniper,

      Thank you for your feedback.

      To answer your question on the DOW transportation and Russell indices. I don't follow them everyday. I follow the major indices.

      I think that the markets are the markets and the trends are the trends. It would seem as though the current markets have divorced themselves from reality.

      All the best,

  9. Adam,

    Would you share some your view about bond market? Bond market is in a very interesting period time. I guess its relation to other market is something interesting to watch.

    Thanks a lot.

  10. Adam,

    Thank you for your updates for the Market. I thought we will get about 10% correction, we are close. I do not know market will start bull trend in next three months. From fundamental standpoint, there are still drags unfold yet worldwide. We will see what happens next three months, then go from there. I watch gold closely, I tend to add some gold for long term view. The problem is gold is very hard to trade on short term basis.

    I start to learn technical. I appreciate your training course. Would you share your views how you will buy/sell gold?

    Thank you so much.

  11. I agree with your read of the charts. Over the last year I have set stops at many of these low points and as yet to see them broken. I don't know if this time it will be different. Only time will tell.

    1. This is the good strategy for a investor, maybe, but not for a trader.
      If you see those lines broken, then switch from bull to bear, you could lose 10% in your portfolio already, or maybe lost 20% if using margin. And even worse, after you switch from bull to bear, market could quickly turn around when they hit 200 dma, then you could lose even bigger... There is no one strategy always work in my view.

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