Wednesday, March 22, 2006

Thresholds

Bleah. Based on yesterday's action (and Microsoft's announcement about the Vista delay last night......and the very bearish GLOBEX prior to the opening) I was thinking today would be a big down day. Not so! It was up over twice as much as it was down yesterday!

I've submitted charts galore recently (and Blogger is really having trouble with uploads lately), so I'll make today's submission short and sweet.

Below are five major indices and what I consider their break points. Above the bullish levels (which are quite close) implies strength. Crossing the bearish levels (much farther away) makes a strong case for weakness. You might want to set up some alerts with these levels to be notified when these items cross these thresholds.

(Umm - another technical ding to Blogger - I have no idea why the table is wayyyyy down below this text, but please scroll on down. C'mon Blogger! What's the deal?)






































IndexSymbolBullishBearish
Dow 30$INDU11,43010,922
NASDAQ Composite$COMPQ2,3332,189
Dow Utilities$UTIL417.95392.82
NASDAQ 100$NDX1,7171,633
S&P 500$SPX1,3111,168

11 comments:

costas1966 said...

Frustrating isn't it. I tell you at this point in the cycle almost 4 years bull market in a rising interest rate mode, the violation of the bearish points are much more important than the bullish points. If we violate the bearish points we are looking at a strong directional move on the downside. If we violate the bullish points what do we have to look forward?Some more upward drifting with narrow breath and leadership. It was all large caps again today 24 of the dow stocks were up with 6 down.

Mike Stone said...

Tim,

You only look at price movement. What about volume? Volume on up days has been horrible, breadth has also
been detoriating.

Are these price targets based on some sort of fibonacci relationship?

NO DooDahs said...

It's only frustrating if you're a permabear. If you're OK going long in a bull market and going short in bear market, all you really need is an idea of the current direction (which is UP, by the way) and not try to make it what you want ...

Tim Knight said...

I love Fibonaccis, but no, these are simply important low or high prices establish in recent weeks/months. The bearish ones are particularly potent, since breaking an of them would clearly denote a core change in trend.

Kapil Khanna said...

If 11,430 on the dow is bullish and 10992 is bearish then where are we currently? Looking at the preceding trend it is evident that we are bullish. For me 11430 + is profit taking zone :).

PB said...

This market will keep fcuking around like this until the Fed is stopped raising rates, which might not be 'till summer. After that the damage will have already been done and all the longs will start dumping. By the way, one thing to ask yourself is this, if the markets in 2000 couldn't pass 11,800 on the DOW, then why would they now? - a mere 5 years after? You bulls are greedy fckers and you got all the risk priced wrong in the market right now. See you on the waay down!!!

Tim Knight said...

I don't blame bulls for being greedy, PB. I'm greedy too. I just blame them for being morons.

PB said...

ok, greedy morons then? :)


P.S. Your blogs are great!!!

Tim Knight said...

Sounds fair ;)

I've actually felt sort of bad about my comment, because I'd like to believe I can be objective in any market, up or down. But, in case it's not really obvious, I am definitely more inclined toward bear markets than bull, and in my view, the likelihood of a down market over the coming years is so much greater than an up market, I show my stripes (or fur) a bit too much! Anyway, things are (somewhat) down today, so let's keep our eyes open....

PB said...

Well, if it wasn't for bulls we wouldn't have a market! Nothing wrong with being a bull, but in this environment? There will be a reality check coming, it's only a matter of time, but the longer it is delayed, the worse it will be. So in a perverse fashion, the bulls, to maintain the overall picture healthier, shd really be selling, but hey, bulls being bulls, will want to go after every red cent and in the end they will paint themselves into a corner. I can't wait!

NO DooDahs said...

pb, you seem to want to fight the trend. The trend is up, working it might be more profitable. It might be more profitable to trade bullishly while you wait for the reality check, rather than cuss at the bulls. It could be a (long) while.