4/19/2008 6:08:24 PM
Friday's Gap Up suggests.
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Stock Barometer Analysis
The barometer has given a Buy Signal, placing us in Buy Mode.
The Stock Barometer is my proprietary market timing system. The direction, slope and level of the Stock Barometer determine our outlook. For example, if the barometer line is moving down, we are in Sell Mode. A Buy or Sell Signal is triggered when the indicator clearly changes direction.
Stock Barometer Cycle Time
Monday will be day 1 in our Up Cycle.
The Stock Barometer signals follow 5, 8, 13, 21 and sometimes 34 day Fibonacci cycles that balance with 'normal' market cycles. Knowing where you are in the current market cycle is important in deciding how long you expect to maintain a position.
Potential Cycle Reversal Dates
2008 Potential Reversal Dates: 12/31, 1/11, 2/1, 2/13, 3/6, 4/5, 4/22, 5/23, 6/6. We publish these dates up to 2 months in advance.
Tuesday is the 22nd, while we were leaning towards the market dropping into the 22nd, Friday blew that premise out of the water. Given the gap up, we may still drop into the 22nd. So we'll have to see how this plays out.
My Additional timing work is based on numerous cycles and has resulted in the above potential reversal dates. These are not to be confused with the barometer signals or cycle times. However, due to their past accuracy I post the dates here.
2007 Potential Reversal Dates: 1/10, 1/14, 1/27, 1/31, 2/3, 2/17, 3/10, 3/24, 4/21, 5/6, 6/15, 8/29, 10/19, 11/29, 12/13, 12/23, 12/31, 1/11/08. 2006 potential reversal dates: 1/16, 1/30, 2/25, 3/19, 4/8, 5/8, 5/19, 6/6(20), 7/24, 8/20, 8/29, 9/15, 10/11, 11/28. 2005 Potential reversal dates based on 'other' cycle work were 12/27, 1/25, 2/16, 3/4, 3/14, 3/29, 4/5, 4/19, 5/2, 6/3, 6/10, 7/13, 7/28, 8/12, 8/30-31, 9/22, 10/4, 11/15, 11/20, 12/16.
The following work is based on my spread/momentum indicators for the QQQQ, GLD, USD, USO and TLT. They are tuned to deliver signals in line with the Stock Barometer and we use them only in determining our overall outlook for the market and for pinpointing market reversals. The level, direction, and position to the zero line are keys in these indicators. For example, direction determines mode and a buy signal 'above zero' is more bullish than a buy signal 'below zero'.
QQQQ Spread Indicator (NASDAQ:QQQQ)
The QQQQ Spread Indicator will yield its own buy and sell signals that may be different from the Stock Barometer. It's meant to give us an idea of the next turn in the market.
Gold Spread Indicator (AMEX:GLD)
To trade Gold, utilize the Gold ETF AMEX:GLD. This gives us a general gage to the overall health of the US Economy and the markets, as well as to assists us in the entry of positions in our stock trading service.
US Dollar Index Spread Indicator (INDEX:DXY)
To trade the US Dollar, I'd utilize the Power Shares AMEX:UUP: US Dollar Index Bullish Fund and AMEX:UDN: US Dollar Index Bearish Fund.
Bonds Spread Indicator (AMEX:TLT)
To trade Bonds, I recommend Lehman's 20 year ETF AMEX:TLT. Note that the direction of bonds can have an impact on the stock market. Normally, as bonds go down, stocks will go up and as bonds go up, stocks will go down.
OIL Spread Indicator (AMEX:USO)
To trade OIL, utilize AMEX:USO, the OIL ETF. We look at the price of oil as its level and direction can have an impact on the stock market.
Supporting Secondary Indicator
I monitor over a hundred technical indicators, some that are widely followed and some that are proprietary. These indicators break down the market internals, sentiment and money flow and give us unique insight into the market. I feature at least one here each day in support of our current outlook - and to give you an education on what professional traders utilize.
Summary of Daily Outlook
We have a Buy Signal, placing us in Buy Mode.
The call for a reversal into the 22nd, which is next Tuesday, may still come in. This may set up the next leg higher. For now, we're going to position for an advance and look for the market to pull back over the next couple of days before going higher.
As a matter of updating some of our services, we have a couple of cool things going on. First, I have to say that I haven't seen performance like Angelo Campione's in some time. Angelo returned over 100% in 2007 and his last 3 trades in 2008 have returned over 30%. If you can trade credit spreads - or if you can't, but have a brokerage account with Think or Swim, then please follow these links and subscribe - so you don't miss the next trade (which was just placed).
Click here to subscribe to Advantage Credit Spreads' profitable trading advice for only $49.95/month.
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On the stock option side, I've taken over as manager of Stock Options Speculator. We'll be closing one of our most recent successful trades this week - it's up over 112%. Since it was a bull call spread, it had a max profit potential of 200%. So we're close enough to pocket these gains and move on to the next trade. We have a few other trades open. To find out more, you can subscribe below. Here's an example of the recent AMZN Bull Call Spread we placed:
If you have any questions or comments, email me at Jay@stockbarometer.com.