Hawk’s Scan Sentry Report September 24
Since the big up move after the FOMC announcement about 10 days ago the markets seem to be waiting for some other significant impetus to move one way or the other. For the past week we have seen mostly consolidation. I have heard some say that the longer the market stays at a new price level, the stronger the indication that traders accept that level as fair value. As I have said many times in 2012, I believe that through the end of the year the path of least resistance is upwards. But for the coming week I am not so certain. We could easily see a pullback down to the support levels at 1435 or 1422 in the S&P Index; or we could see a move in the direction the next upside goal around 1525. Here’s where the American markets stand right now. The S&P futures contract, though down 6 points on the week, shows no signs of significant weakness yet. The Nasdaq contract is making higher highs but is showing some divergences in the process. After going sideways all week, the Dow Jones futures contract had a breakout day on Friday, and the Russel contract also tested new highs earlier this week. Gold is at a 6 month resistance level so it may slow down for a spell from its bullish rampage. Although the Euro has been declining this week, the technical analysis indicates that the worst may be behind us for a little while. Note the bullish pivot divergences with the Radar1 Fear/Greed indicator leading into August. Look to re-enter long around the 1.2740 level.
When I’m trading American equities I like to look at both long and short possibilities in order to be ready to trade with the market whichever direction she decides to go. Below are some charts of some of the symbols that I have identified this week for my weekly trading watchlist. Each contains a little explanation of the analysis visible on the chart. If you have any questions about the indicators on these charts please follow this link to a legend describing these tools.
(This is a pullback trade identified by the oversold Trend Exhaustion 1 signal. I like that this is occurring at the uptrndline after a pullback into the Triple Trender. It also looks like there may be Pullback 23 setting up. )
May the trend be with you,
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