Global Trading Blog
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Dear Subscribers:Market halted its decline today and reversed its losses as it reached a short term oversold condition for the third time in just a few weeks. The 150 day moving average served as support in the Nasdaq Composite. There is a change of character. As the market trended higher and things were going well, we saw the market reach overbought conditions and remain in the higher ranges of its oscillator. Oversold conditions were quickly bought.Now we have become short term oversold a few times and the bounce have been weak and short lived. The weakness in the market has ... -
Dear Subscribers:Today the market is bouncing from the oversold conditions we mentioned on yesterday's update.Most major US indices hit their lower bollinger band at 2 standard deviations and their RSI marked short term oversold readings. We are also seeing a positive divergence here.In an uptrend we can expect a reflexive bounce from conditions like this.However we are facing resistance once again here in the S&P 500 and in the Nasdaq Composite, the 50 day moving average. Macro data gave a hand today with a very positive reading in the Unemployment Claims which has reached its lowest level since February of ... -
Dear Subscribers:Yesterday we got a sharp upside reversal during the afternoon. The S&P 500 managed to close over its 150 day moving average and close positive.This technical action is positive and high volatility is to be expected as bottoms are formed.Just remember how crazy the market was during the August-November 2011 when the market bottomed.However, the Market Monitor is showing weak buying. The strong money is still not entering the market. We can interpret the current action as timid buying or short covering. When we get a very strong up day, with 800 or 1000 stocks being accumulated, that will be ... -
Dear Subscribers:Today the market was unable to rebound from the Oversold signal of the Market Monitor.There was a feeble attempt to rally on some better than expected macro data but the situation in Europe (Greece) got the most out of investors and the market sold off in the afternoon.EUR/USD has been very weak which helps drag down the market.I think we have one more day of selling left, in which panicky sellers appear, before a short term tradable bottom occurs.Selling pressure has increased during the last couple of days but with still need to see the market "vomit" everything in ... -
Dear Subscribers:The market yesterday entered in a "panic selling" mode.We basically sold off straight down all day with no bounces at all despite being oversold in a daily timeframe and ultra oversold in a short term time frame.The sell off pushed the already oversold technical indicators into ultra oversold levels that we have only seen in other important panic sell offs like last year during the European crisis.Of course the market can keep on moving lower but the odds for a bottom or strong bounce from here are very high if one analyzes the past market behavior.Pictures tell more than ... -
Dear Subscribers:With today's gap down the market has become oversold and there is a high probability we will get a meaningful bounce from the current levels. A variety of important momentum/breadth indicators have become oversold and historically we have seen strong rebounds from similar readings.Last time all of these indicators were this oversold was on November 24, 2011.From the lows of that correction the market bounced 9.4% Also, the S&P 500 has support from its 50 day moving average and bollinger bands, increasing the probability of a bounce here. Market Monitor: Mclellan Oscillator: I also found an interesting stat from ... -
Markets fell hard on Wednesday to mark the sixth day of consecutive losses for the S&P 500. The continued sell off experienced by the markets made the current pre thanksgiving week one of the worst performing in history. The Euro crisis and the political deadlock of the "super committee" are the culprits of the current sell off according to the headlines.I attribute the selling to a macro problem. There is an ongoing deleveraging process in developed western economies that started in 2007. Abscent of new monetary and fiscal stimulus ( QE2 ended this June and the US & European governments ... -
A fourth day of consecutive selling was experienced in most world indexes today.The sell pressure got "crash like"for part of day. A lot of well known stocks like Amazon fell over 6% before bouncing as indexes found no support and buyers had fled the market.Although the markets closed off the lows, the selling was very intense and a lot of technical damage was done to leading stocks and the major indexes. The S&P 500 broke down with ease from its 50 day moving average and the NASDAQ Composite has no clear visible support unitl the October lows. Charts paint a ... -
A broad sell off in equity markets around the globe caused major indices like the S&P 500 and the NASDAQ composite to breach important support levels. The two consecutive down days on higher volume have technically broken the uptrend that started in early October and warns us to be cautious.Buying stocks right now is risky and one should wait until a new uptrend to emerge or wait for the to markets become extremely oversold to play a rebound trade (which has worked the best during the last three months or so). The market has remained risk averse and unable to ... -
Dear Subscribers: Markets rebound around the globe after reaching an extreme oversold condition. Optimism is generated because European leaders intend to leverage the ESFS in order to give it the necessary funds to bailout and help the finances of the troubled PIIGS nations. The S&P 500 rebounds to 1190 and is once again near the resistence zone that hasn't been breached in previous rebounds. Macro data today was "less bad" and the market reacts in a favorable manner. The rebound today is being led by the most oversold indexes or stocks, some of them made new lows last week. Leading stocks have ... -
Dear Subscribers: Last week stocks started on a positive note with the S&P 500 reaching resistance at 1260 from where the market crash had started a couple of weeks back. However, by the end of the week, dismal macro data started to choke optimism making world indexes fall hard and ending the week deep in the red, nearing the lows of the market crash. However, in the S&P 500 and other indexes we are starting to see some positive divergences and lower volumes during the sell offs. American indexes are oversold at a level not seen during the financial crisis and ... -
Dear Subscribers: Today the bears attacked the market with all their artillery with a barrage of bad news and dissapointing macro data. Investment bank Morgan Stanely during the asian session sent a report where it states that the US and Europe are near a recession and lowered its growth forecast for the world to 3.8% from 4.5% for 2012. The reaction in Europe was powerful, with most banks and car markes falling hard. BMW fell about 8% and banks such as Barclays and Societe Generale plummet 12%. The German DAX in germany ends lower by 5.82%. Then it was the turn ... -
Dear Subscribers: Markets positively absorb the macro data due for today despite a dismal UOM Consumer Confidence report which reaches its lowest levels since 1980. Consumer confidence is lower now than in the midst of the 2008-2009 bear market and financial crisis.. However, retail sales were better than expected with an increase of 0.5%, something positive for the US economy whose GDP is 70% consumption.75% of the market is positive today, the S&P 500 gains over 1% in a continuation of the rebound from the panic lows we hit on monday. The UOM Consumer confidence report is the worst level since 1980 but ironically, ... -
Dear Subscribers: Markets around the globe are experiencing huge gains today. Something that didn't happen in a while, gold, silver, treasuries and gold stocks are down for the day. It is a relief that treasuries are finally following some fundamentals and falling, helping our losing position trade on TBT. It helped the rally that the weekly unemployment claims were better than expected. A in line or better than expected is always of great aid in an ultra oversold and shorted market. Unemployment claims dropped to 395K which is under the critical 400k level. Also the trend of this economic indicator seems to be turning ... -
Dear Subscribers: Yesterday we had a strong gains in all markets around the world. There was strong breadth that we hadn't seen in an upday for quite some time. Of the Market Monitor, all assets except one (China with the FXI ETF), ended the day positive. The Up Volume/Down volume ratio was 10 to 1. A lot of buyers emerged to defend the support zone created by the 200 day Moving Average and March lows in the S&P 500. Up Volume/Down Volume Ratios: It helped the market that we only had one macro data point yesterday, Existing Home Sales, and that it ... -
Dear Subscribers: Yesterday the market continued to rebound the support zone created by the march lows and the 200 day moving average despite that negotions on the greek bailout plan failed during the weekend. The absence of macro data yesterday and the rather stale news regarding Greece allowed the market that trading in the markets to remained very technical, with most world indexes, that are oversold, rebounding during the day. This helps our short term swing trade long on the DIA that we entered last monday. Currently asian and european stocks are rising, dragging to the upside the S&P 500 futures ... -
You can read the original article in this link: Pullback Offers Great Chance for Quick ProfitWhen I wrote my mid-March blog, markets had corrected about 5 percent from their highs and investors were running scared due to a plethora of bad news — but especially because Japan had suffered a major natural disaster.At that moment, markets had become short-term oversold and I advised: "don’t fall prey to the fear and use these sell-offs as opportunities to buy quality stocks that are undervalued." From then onward, the market rallied until the beginning of May.This time, the downdraft in stocks has been caused ... -
Dear Subscribers: Today the market was weak despite its general oversold condition. For a moment we saw new lows but then some buying interest appeared and managed to close the S&P 500 and the Dow Jones Industrials barely positive. Beneath the surface there was deep selling, with the S&P 500 Cumulative Tick Intraday closing on -8196, the second most negative reading in 10 years. In a sense this could be interpreted as a positive as intense selling pressure could not manage to drop the market lower. During the asian session, inflation data from China comes in line with expectations rising 5.5% during ... -
Dear Subscribers: We begin a new week in which I expect it to be positive for the markets after 6 weeks of consecutive downside for american indices. Despite various short term positives that should have generated at least a short term rebound, markets fell last week everyday except for Thursday. Important levels of support and favorable historical stats have not stopped sellers from dragging the market lower. Last week it seemed the market would never bottom and that traditional oversold and bottom seeking tools were just not working. You must know that the intensity of the selling has been the strongest in ... -
Dear Subscribers: Contrary to the favorable stats that we had shown yesterday, the S&P 500 continued to drop down and got near the level were we have our stop (126.80) for our long trade on the SPY. Since the SPY exists, it was the first time that five consecutive down days into a wednesday results in a down day. 11 out 11 times before the market had rallied yesterday with average gain of 1.3%. The same stats, however, show that 8 of 11 times when this type of selling has occured, the S&P 500 ends the week positive. These statistics ... -
Dear Subscribers:Yesterday the S&P 500 and other american indices tried to bounce from their oversold condition and support of the 150 day moving average. For most of the day, markets were positive but during the last hour of trade we observed a strong reversal that drove the S&P 500 to close barely negative and at the low of the day. This lack of strength from an oversold condition is a behavior we hadn't seen since the financial crisis or european crisis last year. However, sentimentrader.com presented very interesting stats that suggest a very high probability of closing the week positive ...
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I’M VICTOR RIESCO
I’m a financial analyst and professional investor from Santiago, Chile. I’m the owner of Global Trader, a brokerage and trading .
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