Trading Strategies: What Next?

August 18, 2011

Mish's Daily

By Mish Schneider


SPY Broke everything, the adaptive moving average, the 200 weekly moving average and what I was warning about-distribution volume patterns and Death Crosses came home to roost in a big way. Plus, now 7 Distribution days in volume after today. Since tomorrow ends the week, will look for where it closes-can it close above the 200 weekly moving average at 115.52? If so, will there be an Accumulation day in volume? Now waiting to see if we can recover from this blowout at all and how convincing the recovery is re the 200 weekly moving average and volume. Otherwise, see more downside.

DIA Through 111.90 area maybe. Otherwise still has a way to get to its 200 weekly moving average at 107.05.

QQQ This was a big clue yesterday since it closed under the adaptive moving average and had negative pivots. Perhaps through today's high it can fill the gap to 53.00. But, there is lots of room to the 200 weekly moving average below. And since it is only approaching oversold could go down much further.  Will be looking for volume patterns to hint at a reversal, that is either a huge distribution day with a spike lower or a big accumulation day that closes above the gap fill.

IWM Came real close to the 200 weekly moving average at 65.56. Only index that is truly oversold on the weekly chart. Therefore, similar to SPY, will watch to see if it can close above the weekly moving average and if so, how the volume pattern looks.

ETFs:

GLD Can I get a PARABOLIC? If long, trail stops with chandelier exits for at least partial profit.

SLV A bit lackluster but still holding on. Raising stops on the long position, now under today's low.

IYR ChartIYR Only ETF of the sectors and groups worth writing about. Holding the adaptive moving average still. Not in a death cross. Best shot to lead or catch up to its weaker cousins and dump since not close to oversold. Over today's high has gap to fill at 56.00. Above that perhaps some glimmer of hope.

TLT Another one been writing about since the Fed decided to keep rates down. By the way, imagine how much lower we might be if they didn't do that? Like GLD, if long, use the same exit strategies.

UUP Possible double bottom at 20.84 with a gap higher today.

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