Today’s Economic News:
Not much for important scheduled news today.
Quote of the Day:
Sincerity is the highest compliment you can pay.
–Ralph Waldo Emerson
Featured Breadth Chart of the Day:
First time green for the short-term bearish trender. That is starting to shake us out of our bearish mood, but it is not too late for the bruins to get it back under control, but that has to happen over the next few days.
Comments and Levels for the Front ES (S&P500 – Emini futures) contract:
Short: 1669
Long: 1627
While we have been pretty good at calling the high of the day, each day we are calling it higher and higher while our longer-term stance has been a target of 1606. We still like 1606 but have risen up far enough to raise an intermediate downside target from 1606 to 1627.
Our bearish premise remains that we did not get enough hard selling days to exhaust the correction enough to make new market highs and that this current rally off of 1627 is just an extended bear flag that will eventually break to our 1606 area. The problem with our premise is that the rally is not breaking and at this rate, a 1679 target on the high side is very near possible and might be needed to set up the further selling we are looking for.
So today we raise both the upper limits and lower limits from 1662 to 1669 and 1606 to 1627. We are finding our downside confidence shaken but we remain downside focused, unstirred, and the MiM from Friday helps us stay here in this mode for now.
On the MiM:
Another good ride on the MiM on Friday. All systems lined up on the sell side and being near the highs was well worth taking the ticket for a ride. Best entry was out of the chute at 3:00 pm, giving a nice 7 for those that can trade.
For the patient traders, the 3:20 – 3:30 window gave you a 4 to 4.5 point trade:
We have our first full week in September and we expect the volumes to begin to pick up even more this week as traders begin to get ready for the roll into the Z contract (December) and the funds position to beat the market into the year end.
If you want to join the meter readers you can go to: Join the MiM
Comments about TLT (Twenty year Bond ETF):
Still looking down our noses to that 100 area. Watch 102.50 for a break that will be quite bearish and should take us to the 101.25 area.
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Breadth Charts in Full :
Zweig Breadth Thrust:
Zweig getting a bit of a boost into the Friday Close. We think this morning’s gap open could be a buy.
Cumulative Volume Index:
Upside volume has stalled out.
Number of NYSE issues trading ABOVE their 40 day moving average (40DPI):
There was positive breadth on Friday, we need to watch as the broader market might just be getting solid enough support to form a foundation for the bulls to leap from. If you are short and want to be protective, watch the Russell 2000 a/d lines and see if risk is in favor. It doesn’t have to be positive, just leading.
New Highs / New Lows ratio chart :
New Highs not suggesting any strengthening.
Trenders :
Short Term Trender – McClellan Summation Index:
Bearish/Neutral
Long Term Trender – Cumulative 4-week Highs – Lows (the fat lady):
Bearish/Neutral
Thank you for Reading –
Marlin aka RedlionTrader @redliontrader
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