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Monday, August 30, 2010

SPY Daily Chart w/Today's Intraday Price

-SPY has rebounded to near the top of the short-term falling channel, which is currently around 107.3. There are may economic indicators to be announced this week which could determine whether the overall market would continue its fall, or establish a new pattern by breaking out of the well-defined channel. I would put back on the short position that I recommended to take off when SPY was near 104.2. However, I would take off the entire short position should SPY close above 107.6.

-Technical indicators for the most part are still bearish, but EFV is below its moving average which is bullish and Linear Regression Slope, while still below zero, is above its moving average as well. Implied Volatility on SPY is 24.

Wednesday, August 25, 2010

SPY Daily Chart w/Today's Intraday Prices

- SPY in early morning is trading lower. This would be the fifth straight days of decline if we close down for the day. Stochastic Oscillator (11-day) is showing that SPY is at oversold levels, so we could see a technical bounce from around 104.2, which is today's value of the lower channel line of the current, short-term trend. The upper line's value for today is at 108.5.

-All indicators are confirming that a Trend (down) has taken form. The rule is to follow the trend, but I would be inclined to take some of the bearish position off at around 104.2 and look to add it back on at higher SPY levels. Of course SPY could keep falling, but prices do not go into freefall without a clear and present shock. Fears of a double-dip recession are real and currently has a strong hold on the markets, but this plays itself out over a longer-time period.

-Implied Volatility on SPY has risen now to 27, compared to EFV indicator's value of 24. I would tilt my bias to start shorting options, but not aggressively...yet.

Tuesday, August 24, 2010

SPY Daily Chart w/Today's Intraday Prices

-SPY continues its decline, and the pace of the decline is shown by the narrow trendlines. I would also use the top of the this narrow trendline or 108.6 level as of today's date as my profit stop level for the current bearish position.
-Implied Vol on SPY options is up 2 pts. to 26 at this moment. This is higher than the Estimated Future Volatility Indicator's value at 24.23.

Friday, August 20, 2010

SPY Daily Chart w/Today's Intraday Prices

-All indicators pointing to high probability of further price declines in SPY. 1) Linear Regression less than 0 and below its moving average. 2) Volatility Signal less than 50 and declining. 3) Estimated Future Volatility Indicator above its moving average. 4) MESA Sine Wave crossed below MESA Lead Sine Wave. 5) MOST NOTABLY, Stochastic Oscillator crossing below its moving average without having risen to overbought levels.
- Current bearish view since SPY opening price of 110.65 on August 11 continues. New short-term trendline drawn to show profit stop of 109.65 as of today's date.
- Estimated Future Volatility Indicator's value is at 24.22 vs. Implied Volatility level of SPY at 25

Tuesday, August 17, 2010


-SPY is currently at 109.01. First resistance level is 109, second resistance level is 110.0. After sharp declines early last week, SPY has shown little movement up or down.

-All indicators are still showing that risk is to the downside. Estimated Future Volatility Indicator is at 24.5, still above it's moving average but lower than the previous day's value. Implied Volatility on at-the-money options for SPY is at 24.

-Still bearish, neutral vol.

Thursday, August 12, 2010


- SPY off of morning lows, but below all previous support levels. The next major support is 105.0 level. Resistance is now 109.0 and 110.0. Linear Regression has gone to negative. Stochastic Oscillator not yet in oversold levels.
- Estimated Future Volatility rising and at 25 level.
- Bearish, long vol.

Wednesday, August 11, 2010

SPY TEMA Daily Chart

- What a difference a day makes! SPY intraday now below 2nd support level of 110.0, threatening to break below on daily chart basis. Next support level is 109.0 but it is minor. Next major significant support level is 105.0
-Estimated Future Volatility now above moving average and looking to breakupwards from downtrend.
-Technical Outlook. Bearish, long vol.

Tuesday, August 10, 2010

SPY Daily TEMA Chart.

-SPY still moving in short-term rising channel, but losing bullish momentum. 111.80 1st support level being tested today, but after FED announcement, appears to be holding. 110.0 is 2nd support level.
115.1 is next resistance level.
-Estimated Future Volatility Indicator and 30-day Implied Volatility in SPY ETF has come steadily down over past several weeks both to 20 level, so I do not see discrepancy.
-Mildly bullish, neutral volatility.