Friday, June 11, 2010

Yesterday's Market

The GLD ETF may be forming a double top. First, note that we have two price spikes at more or less the same price level (a). Also note the volume on the first top (b) is higher than the second top (c).

Now take a look at several technical indicators. The A/D line printed a lower number on the second top (b), as did the CMF and MACD.

For the SPYs, we're still looking at a possible double bottom (a). I still find it very interesting that we have not seen a mass exodus in the A/D (b) or CMF (c). You would think both of these indicators would have tanked during the last sell-off. However, let's take a closer look at the sell-off:

Note the very large bar next to (a) -- that's a huge rebound move. Then look at section (b) -- another area where we have a large rebound and a large bar along with a gap higher. Section (c) also has a large rebound bar moving higher. Even during the worst of the sell-off, traders were still buying on the dips. That tells us that the ~1050 area holds a great deal of interest for traders.

The Treasury market may still be looking to reverse as well. First, what concerned me about the island reversal call [(a) and (b)] was that rebound (b) was moving into the island area. However, yesterday we saw prices move lower, through the uptrend. That's a big development. Also note the technical indicators are still pointing to a lower market -- money is flowing out of the market (c and d) and the MACD is moving lower (e).

Finally, note the industrial metals are still in a strong downtrend.