Mark Lytle's Blog – October 2009 Archive (9)

The $NDX ended up falling very hard today, and both it and the $SPX are at the trendlines now. Combine exponential trendline analysis with sentiment, and you have a high probability of a short term rally...

The sentiment chart is from :



http://www.sentimentrader.com/…

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We are now approaching some intermediate scale trendlines, which I have highlighted. Today's low (so far) on the $SPX is almost on one now. Tomorrow or Friday could see a bounce as some indicators are getting oversold. The nature of any bounce that materializes will tell a great deal about the real condition of the market.…

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You can see the trendlines in this system, that I've highlighted, that have to fail for the bear to fully come back...
The Macro view will be seen later, assuming the decline continues, as on that scale this current change is barely visible...

Note that using these particular dates the March 2009 bottom was at a .500 node (the values on the 'X' axis) and the current date is also near a different .500 node (there are three of them for a given set of seed dates).…

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You might remember this chart from last week. Well, it broke through the trendline it was banging against, and ran up to this new one. Let's see what happens here.

On the third chart down, referencing the chart of the QQQQ's, notice the Ultimate Oscillator and Chaikin's Money Flow plots. The latter looks like it could break down here, we'll see what happens Monday....a lot of neg. divergence as we hit the… Continue

This chart is one of the sources for my call yesterday that the market might falter here...You can see which trendline has held so far, it's highlighted. These trendlines are generated from the start and end points of the October 2007 through March 2009 decline...this is a shorter term basis then some of the other ones I've published here. They can be violated, but I give them the benefit of the doubt until they… Continue

We're attacking an already respected trendline, and as earlier conversations attest, there's a lot of overhead resistance not far above the top of the 23'rd of September..