Wednesday, September 19, 2012

Tader Update -data point 20 September 2012-

...the SPX 500 market remains in an intermediate overbought condition
 while small caps leading short term weakness together with a cash-like rout in oil - based on exteme imbalances in the markets, one thing is fo sure: the Fed timing of QE3 into an overbought market sucks big time - a sell down to challenge the 21 August 2012 High *1426.48 with futher downside potential into the *1400 level would clear the overbought condition and make way for the next rally up into all time Highs past the presidential election
...a sell-off would be consistent with a 4% drop in the SPX 500 the last time the Fed announced QE2 on 3 November 2010
...the descending VIX signals another plausible scenario that has the SPX 500 market in a sideways move into its apex - the end of the presidential election week- before a break-out would determine futue direction this stage, there is simply no alternative to some potection to mitigate the risk in a trading environment fraught with extreme imbalances and a Fed timing that sucks big time
Kind Regards

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