Professor’s Comments April 20, 2016
Posted by OMS at April 20th, 2016
The market was mixed yesterday. The Dow rose 49 points, closing at 18.054. The NASDAQ dropped 20 points to 4,940. Volume was moderate, coming in at 105 percent of its 10-day moving average. There were 192 new highs and only 5 new lows.
There were no changes to the indictors after yesterday’s trading, but it is very possible that Wave 2 up completed yesterday. I say this because after reaching an intraday high of 18,102, the Dow pulled back to close near its mid-point of the day. This caused a bearish candlestick to form that is often seen at market tops. We’ll see.
The other reason I say the top in equities could be in is because I got a buy signal on gold. The same custom money flow indicator that I mentioned yesterday turned positive on GLD. So now with several gold and silver stocks on the Dean’s List, and all of the PT indicators Green, I will start looking to buy gold stocks on pullbacks.
Basically I will be using my Rifle Trading strategy to buy my gold shares. I’ll simply wait for the 2 period RSI Wilder on the Daily charts to become oversold and then use the 60s to trigger the trades.
I’m not going to chase gold at this point mostly because my focus is still on the equity markets. And right now all of the indicators that reflect these markets are still pretty strong. If I’m right about a top forming in equities, gold should start to take off once the equity markets begin to decline. So for now, I’m just waiting to see The Tide and some of the other cockpit indicators confirm the top in equities before I do anything.
BTW, many of the cockpit indicators for the equity markets are diverging and very close to turning negative. So if the market does start to decline, the fact that they are diverging before the decline could tell us a lot about yesterday’s potential top.
Also remember that when The Tide turned positive on 16 February, the Dow was trading at 16,196. Now the Dow is up almost 1,900 Dow points, and The Tide is still positive. Like I always say, “Follow The Tide”’
Waiting.
That’s what I’m doing.
h
Market Signals for
04-20-2016
DMI (DIA) | POS |
DMI (QQQ) | POS |
COACH (DIA) | POS |
COACH (QQQ) | POS |
A/D OSC | |
DEANs LIST | POS |
THE TIDE | POS |
SUM IND | POS |
Not sure of the terminology we use? Check out these articles
The Hockey Stick Pattern
The Creation of Waves and Trends
FAQ
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Category: Professor's Comments