The early market action on Monday, August 16th, triggered a key weekly "Trade Triangle" to the downside. Our weekly "Trade Triangle" turned red, indicating that all trends are negative and now pointing lower.
In this new 90 second video I show you some of the scenarios we can see playing out for the S&P 500. I think you'll find this new video informative and educational. You will also come to understand the power of our "Trade Triangle" technology.
Please feel free to comment on our blog with your thoughts on this market.
As always our videos are free to watch and there is no registration needed.
All the best,
Adam Hewison
President of INO.com
Co-founder of MarketClub
This trade would have lost money now that there is a green weekly at 1105. Using the weekly for timing you'd be short at 1077 and now at 1109 with a green weekly triangle meaning to get out with your loss. I have noticed this happening a lot, the trend changes and signal gets you out late. I think the system works in trending markets, but not sideways. Of course you never will know where you're at until it's over.
Adam,
Would you enter a long position similar to your example above even though the market is currently short? Or, would you wait for a stock to trend with the market?
Biil,
Personally and according to our approach I would wait for the Trade Triangles to alert a buy or sell signal.
All the best,
Adam
When the monthly triangle changes, ALWAYS, ALWAYS, ALWAYS wait for the weekly triangle to match the monthly triangle, and have volume confirmation, before trading on the new side of the trend.
nothing is working that you are saying thats all.
Dakshit,
It is not over till it is over. This approach is not a daily trading system.
Thanks,
Adam
Goodmorning Adam,
well yesterday the stocks were UP so we will see!!
Regards Mar Tielbek
Adam,
I was studying the S&P500 chart using the tools you provide in Marketclub and it looks to me like the hourly chart has peaked and shows deterioration in momentum and resistance. MACD, while still not showing blue crossing below red does appear to be peaking. I see this looking similar to the chart pattern from early Aug(2-3)before market eventually moved down several days later.
Furthermore, I used the fib tool to span the recent peak at the 1130 area to the recent 1070 low. I also have the 200 and 50 point averages on the chart. Wouldn't you know it... the S&P moved up to kiss the intersection of the 200 point avg and the 50% retrace level before moving back down away from it.
Finally, to make it just that more interesting, on its way back down, it closed yesterday right on the 50 point avg and also the 38.2 fib level.
Perhaps that 1100 mark is going to pose some resistance now. I used your other tool and drew a straight line across the chart at the 1100 mark. It's a huge activity line. There is all kinds of deflections up and down off that area +/- 5 points all the way back from May.
Looks to me if we get a little bad econ or global news, we should continue to move down off that line. I would also suppose if things perk up with additional "good news" like we had the last 2 days, a return move over the 200 day avg at ~1116 (gap fill there?)might keep the bulls supported with low vol. up trend. Thoughts?
Bests,
Jeff
Jeff,
If nothing happens in the economy the bear market returns. Bear markets do not need negative news to go lower they fall on their own weight.
All the best,
Adam
I've been short already but at a distance selling vertical option spreads high above the action. That was some beautiful spike to short today, a gift.
Adam, is your view on the weekly triangle not shaken with yesterday's close above 1077? An intra-day print is enough of a confirmation?
With thanks,
Mike
Mike,
Not shaken. Sticking with the rules.
How "Trade Triangles" work in stocks.
The major "Trade Triangle" to watch in trading stocks is the monthly "Trade Triangle" as this triangle determines the trend. We use the weekly "Trade Triangles" for timing purposes. Let me give you an example, if the last monthly "Trade Triangle" is green this indicates that the major trend is up for that stock. You would then use the initial monthly "Trade Triangle" as an entry point and use the weekly red "Trade Triangle" as a stop out point. You would only reenter a long position if and when a green "Trade Triangle" kicked in. You would then use a weekly red "Trade Triangle" as a stop out point. Providing that a monthly green "Trade Triangle" is in place the trend is positive for the stock. The reverse is true if a red monthly "Trade Triangle" shows that the trend is down. You would then use the weekly "Trade Triangle" for entering and exiting the market.
All the best,
Adam
Good comment by Dennis.
Harrys, I think your hope of 1130 is pie in the sky, chum. At least I would never take such risks.
You are tiring of being in the sidelines at exactly the wrong time. Never let emotions direct your trading. I think you need to wait until the last week November and/or last day of February 2011. If you want to go long think of other things than equities or do something else for 6 months.
The reversal to the down trend is happening NOW, in these last few days until the end of August. See also the best technical analyst interviewed by the CNBC:
http://www.cnbc.com/id/15840232?video=1568298459&play=1
I believe if our fearless leader in the White House would do something about the employment situation (which he is curiously avoiding) the markets in general would take off upward.
Short term oversold use strength to short or take profit I think.
my belief is that everybody's analysis of the market is right until the market says otherwise.
so, my quess for S&P500 is that we 're going to witness a small rally up to the 1130 territory. Above that level i believe the red weekly siglal is canceled.
What I reaaly want to happen is for the market to fail at the 1130 territory and start the so long awaited deep strong downtrend
I 'm so tired being in the sidelines.
please feel free to comment if you think i 'm wrong about the resistance level.
10,268.71, 2163.07, 1076.69 acted more like support levels... waiting for breakthrough confirmation.
IT will be interesting to see how this ends today. The bulls have driven the market right back up to 10453, where I elected to sell based on the resistance on the 21/06 which also aligns with the 50% retracement of this last move.
The market is obviously being propped up. All the shorts just give them more juice to gun it and wreck havoc with the signals.
Ouch!! Again.