from Stock Market Crash Index alert 13/5, page-2

  1. 5,447 Posts.
    SO FAR ....
    A classic recovery rally with the DOW putting on 300+ points in the
    two days, catching most off guard.

    We made the higher-lo/higher-Hi pattern off of the double bottom we
    called last week, and except for the fact we've moved up to far too
    fast, have set our selves up for a good 2-4 week rally. Watch for a
    possible pullback tomorrow after the open which will probably see a
    continuation rally, AMD came out with some great news tonight which
    will probably fuel and early rally before sellers come in to
    "Sell-The-News" as opposed to buying the rumour as they have been
    doing with the SOX(semiconductor) index which is now up 13% since May I said, too far too fast.

    Not only was there institutional volume along with the mutuals, but
    we had participation from some of the sidelined smaller investor
    money that has been squirreled away for a rainy day in low interest
    bearing CD's.

    This is expirations week and Wednesdays very often reverse Tuesday's
    actions, so be prepared for a profit taking selloff, particularly in
    the Techs and SP500 which both left gaps behind in the frothy wake of
    their breakouts to the upside. The Bullish Pennant/Flag formations
    proved themselves accurate harbingers once again, now we need to see
    if we can extend this short term pop to the intermediate term. The
    old adage is to sell the market in May and hold till October, but we
    still think there are a few surprises left in store for investors as
    all that pent up momentum is put to work.

    time in over a year, we have all indices in sync for the intermediate
    term...too early to tell if it will stick,BUT this market didn't
    stand a prayer of a real rally until we saw these get in synch. One
    day does not make a trend, but this is one I have personally been
    waiting to see.

    As I said over the weekent, more important than all of this analysis
    I believe is the action of the CoT report this week that shows
    improvement in all of the commercial positions as of last Tuesday's
    close, which was the lowest level of this market since last
    September. The Commercials have started a stealth buying spree,
    seemingly indicating their belief that the bottom is near at hand.

    The NASDAQs still remain the weak sisters, and will retain their
    volatility and be the last ones to spell a real recovery, but their
    interest by the Commercials is indeed gratifying to see.

    Our profit stops we gave you this weekend were hit on the Bear
    proxytrades and followers should be flat all but the DOW which is
    still on a buy signal. With the best Bear proxy fund up about $175%
    on a closed basis we can't feel bad about taking a few percentage
    points as a sacrifice to the Bull God. These were not reversal
    points, but areas where it was no longer prudent to hold the Bear
    Funds and time to lock in profits. Check the ProxyTrader report.

    NYSE new lows came in at 50 Friday and improved to 24 today ..nice recovery.

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