Still hold bullish view for SPY for the next week

A nail was hammered firmly in the base, SPY will have a bullish run next week.

Market in the next week

SPY will rebound from here in large probability.

First level to watch is 115.57 and then 116.87. Most likely the rebounce will stop at 116.87 level and then will have a small dive from this point. For now, it is wise to close all short position.

With these projected rebounce, three stocks are good for a swing trade: Coach (COH), Delta (DAL), and Micron (MU).

A swing opportunity

In this bear market, looks like a few stocks have at least a short bullish run. Coach is one of them. Buy and hold for a few days may have a good gain.

S&P 500: Short Term Bullish Trend Terminated

SPY was so bullish in the first eight sessions in the last two weeks. I warned to look out for a top two weeks ago. Now, the caution is gone. SPY had a successful break out. There is no major resistance above the current price level. However, in short term, the performance in the last two sessions announced the termination of the last bullish run. Most likely, SPY will pull back a little. I've put two horizontal green lines here. If SPY pulls back above or in the zone of these two lines and then goes up, there will be a long rally for SPY again. If SPY pulls back below the green line around 112, be cautious of a fake break out! Happy trading!

S&P 500: be cautious for a top

As predicted in my last blog, S&P 500 had a nice bullish run last week. Let's re-examine the current market in the following figure:
After the bullish run, the market became over-bought. Three short term bearish signs are emerging: 1. RSI is approaching a short term max. 2. The price is almost over it's 2 SD range. 3. The price is very close to the reversed head-shoulder rebound level: 115. This does not mean an immediate trend reversal and short, but this does mean to be cautious and if necessary take profit. What I can say at this point is: SET STOP now! The chance of a pullback next week is increasing. The level of pullback should be closely watched. If it's too big, a possible double head pattern can form. In case this pattern forms, it will be a very bearish sign in combination of the divergent MACD I mentioned in the last blog.

S&P 500: Technical Analysis

The stock market ended flat on Friday. It seems the market is losing a direction. Many stock investors are confused about the market move. Indeed it's very difficult to find a direction in this quite neutral set-up: 1. The RSI is neutral. 2. The current price is around the monthly moving average. However, if we look more closely, we can see that the market has an attempt to move higher in a short term. The double bottom of the RSI and the reversed head-shoulder pattern favor a bottomed correction. The only unconfirmed signal is the unbroken neckline. In addition to those bullish signs, there is a longer term bearish concern: the reversed MACD. This is a very powerful indicator for longer term trend reversal. If the neckline cannot be broken and then the market turns south, it won't be a correction any more, it'll be a beginning of a bearish market for a least a couple of months.

Apple Still a Good Call

Analysts' Recommendation

My Performance This Year

Is Yahoo! a strong buy?

Standard & Poor's issued a strong buy for Yahoo! (Ticker: YHOO) recently. They believe Yahoo's revenue will increase 7% in 2010 and 2011 respectively and they also see the joint venture between Yahoo! and Miscrosoft is a good sign. Is YHOO a strong buy?

Fundamentally, analysts expect Yahoo! to make good earnings in the next couple of years. Here is the earnings estimates:

If the current economy is recovered healthily, Yahoo!'s earnings trend looks promising!

Technically, Yahoo! is in a mid-term downtrend. However, in short term, there is a well formed bottom as indicated by the green arrow in the following figure (Weekly chart of YHOO). The bottom is confirmed by the last week's rally. In short term, it's extremely important to observe whether the blue downtrend resistant line will be broken through. If it's broken, it's a sign of a mid-term trend reversal and also exhibits a possible long term rally!

On the other hand, the contraction of short interests also indicates a bullish trend for Yahoo!, as seen in the following figure.


In summary, the fundamental and technical factors indicate that Yahoo! is on a right track for a bullish run!

Chicken stocks that will be affected by China's tariffs

There is an ongoing chicken war between China and the US now. Those two stocks will be affected. But who is the Chicken Little? :)

Pilgrim's Pride (PPC): duty-fee 80.5%
Tyson Foods (TSN): duty-fee 43.1%

Top 10 hot Tech stocks for 2010 by Kiplinger

1. Applied Materials (AMAT)
2. Autodesk (ADSK)
3. Cisco Systems (CSCO)
4. Hewlett-Packard (HPQ)
5. Microchip Technology (MCHP)
6. Micron Technology (MU)
7. Nice Systems (NICE)
8. Nvidia (NVDA)
9. Vistaprint (VPRT)
10. Yahoo (YHOO)

市场已经筑好了底

从图上的divergency来看，市场的下降趋势已经终止。上扬趋势可期！

SPY Short Interest

S&P 500: 美国股市下跌已终止

今天美联储又一次降息，利息跌到了五十年的最低。如果美国的经济在近期没有质的改变，再降一次利息可以预期。那么，股市如何处理这些信息呢？

附图为追踪S&P 500表现的基金SPDRs的日K线图，它的ticker为SPY。
从图上可以清晰的看到，自九月中后旬发动的下降趋势到目前为止看似未得到实质性的改善。红线所指大约可代表这种下降的趋势。今天，趁着降息的热潮，SPY象征性地冲破了这根趋势线。这是否意味着下降趋势的终结呢？
让我们来看看。
首先，请注意绿圈所指的交易日，这是一个经典的反转图形，具有以下几个特征：暴跌后出现，低开，长脚，长上影线，短空心身子，巨量。第二天的巨幅上涨确定了反转。实际上，这两天就已经决定了下降趋势的终结。后面的剧烈起起伏伏只不过是市场在底部的整理。尤其值得注意的是绿色箭头所指的三次伴随巨量的低位上涨，这些都是大钱入市的迹象。而绿色水平直线所确定的则是一个结实的底。
今天象征性的突破下降趋势线没有实质的意义。但可以肯定的是：市场的下降将不再会那么具有破坏性，而底部的整理在短期内将继续进行：空头慢慢离场，多头慢慢入场，好戏需要时间的酝酿。当SPY回撤到85左右的时候，短期长期的建仓都可缓慢进行。如果美国的经济出现进一步恶化，那么绿色水平线位置83.5就成为多头止损的一个好的标记。

LDK: Short Interest

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Figures for 11/24