Here we go again?

I happened to have the back jacket of “Trade Like an O'Neil Disciple” laying next to me. “What the market will do is anyone's guess. What it is doing should be anything but.” trumpets out in bold print.

Each day I try to forget what I was thinking the previous and look at what the market is doing with fresh eyes. Any prognosticating I attempt I try to keep within a 3-5 day window which coincides with my holding period as anything further than that horizon and I might as well write fantasy.

Looking at the SPX over the past 9 sessions, a lower close established on 06/15 has held. Since this date, there have been 3 days of 1% moves indicating a volatile period.

06/21 1.34%

06/24 -1.17%

06/28 1.29%

06/23 the index showed great strength powering from a low of 1262 to close at 1283 and closing down .28% for the session suggesting that there was a strong bid in the market. The following day being a 1% down day forced the question to this belief, but the low of that day held and the market SPX rebounded 2.2% over the next two sessions.

SPX 06/28

Taking a look at the $USHL5, 52 week highs have rebounded the past few sessions as well showing this move is being supported, and perhaps time will tell whether or not the new stocks beginning to populate this list will be the leaders of the next leg up.

$USHL5 06/28

One indicator that I pay closer attention to as of late the $BPNYA has crossed the 10 period MA. This is one indicator I'll be watching closely and see if this holds. I recall 05/31 and the near cross before the market dumped -2.28% the following session.

$BPNYA 06/28

Lastly I note the Market Monitor that I use daily to analyze markets analyzing for times that are conducive to my trading style. This indicator gives me pause at the moment as I am not witnessing the buying pressure that should compliment the move over the last few days. With primary and secondary indicators are still bearish although two secondary indicators are very close to flipping bullish, I would expect the number of break outs to break downs ratio which currently stands at 1.55 to be higher, but the numbers that produce this ratio have been fairly balanced the past ten days with only one 300+ break out day. 

Market Monitor 06/28

 

This is disconcerting to me because the last few times this has happened the rallies have been brief and very selective. I've taken a few positions as I believe there is a window of opportunity, however slim it might be. Thus far I've been proven to be on the correct side of the order flow, but I'm staying cautious over all and still waiting for this market to firm up and prove itself and for that I'll be looking for a series of break out days. But as the back jacket reminded me, I trade based off what I believe today, not what I will know tomorrow.