Sunday, February 04, 2007 Weekly review

Small and Large caps closed the week strong. Tech averages barely budged. How did the Stockcharts see it?

Joe Reed opens with a simple chart with a simple message. Take heed - strong resistance like this tends to produce scrappy action.

Joe is looking for a bottom in the S&P Energy Sector. His chart shows it nicely:

But is looking for a retreat in the Qs:

Mitchell Meana has gone with a bear count in the Nasdaq 100.

But is bullish for the Russell 2000:

Ted Burge takes a dig at the Elliot Wavers:

Feb 2, 2007! 35 years trading and one principle that has never changed. Someone will try and get your money and if you don't understand why price changes direction 'on a dime' it is time to learn. Easy to get drawn into the trap of believing that 'someone else' can predict better than you can especially when everything you are shown is after the fact and it 'sounds good' because you have been losing money.

Analyzing waves is after the fact. No one can tell you what a wave or ripple will do tomorrow.

Kind of like a flag! Wave all day and nothing waves back!

No one knows what will happen and let's get that straight. TA is accurate up to the minute of the last trade and not one moment beyond. If anyone tries to tell you they know what will happen, ask them to show you a chart that supports it. Hint! There is no chart for tommorow!

I really feel for those that lose money because some donkey that never trades played a guessing game hoping to be right and get some votes.

Techical analysis has nothing to do with predicting, it is about understanding.

It is supply and demand and at the moment it is still demand battling resistance, and strong demand! The facts are in the PnF report and as of Friday morning I have a new video comparing the MAJOR INDICES!

NEW video on GOOG Thursday and very interesting. There is only one thing you will ever know in advance and there were 27 videos last month that will show you before it happened.

Watch what happens at support and resistance. The rest will follow because price is the indicator we watch!

Learning is a journey and not a destination. If you understand and use the principles of TA to 'support' your decision making, you will make some money.

If you don't understand, you run the risk of being fooled by the preditor looking for 'stupid money'.

Forget opinions. Stocks trading millions of shares are not impressed with the donkey that told you what was going to happened.

He sees "opportunity" on the long side for the Qs:

But sees resistance in the S&P:

Matthew Frailey has gone with a breakout in the Transports:

and has marked a consolidation triangle in Silver - the MACD trigger line looks set to generate a fresh 'buy' trigger:

He has an interesting chart showing the relationship between the Nasdaq and S&P - looks to have given a sell signal based on Friday's action (not marked on his chart):

Jack Chan has illustrated 'buy' signals in the Energy Select Sector SPDR:

And United States Oil Fund (but also note potential resistance at the 50-day MA):

Similar resistance breaks were found in the Gold Bugs Index and Gold & Silver Index:

Robert New is positive on the semiconductor Index:

and he also highlights the breakout in the transports:

Richard Lehman had this to say - check out his list, I would post all of his charts if I could:

2/3 -- All in all, things are really quite toppy. Even if the short term charts allow for a little more upside (the Qs and the sectors are candidates), the longer term charts are way toppy. The RUT has also now hit long term trendlines like the large caps. You know these long term lines are holding things back as the charts tend to get very chopy when they reach them.

2/1 -- The Dow and the S&P are pretty much at the top of all their charts. That spells vulnerability. Yes, they can break the reistance on an existing uptrend and raise the slope, but the more likely scenario is a fall back from resistance, even if only brief. The Naz and Qs are really muddy - no real short term trend at all lately, though the RUT is on a tear-- go figure. The sectors are all in fairly strong short term uptrends.

For the stock pickers amongst you, Asher A Pinto has an interesting list of stocks.