US Crash Index update..bullish

  1. 5,447 Posts.
    *** Stock Market Crash Index Update 6/4/2002 ***


    1. Commentary for Tuesdays market
    2. LONG TERM BUY Signal for Nasdaq
    3. New Momentum Trading System / Daily Signals
    4. Memorial Week Pitbull Investor Special Offer


    Today's market action saw a break from consolidation levels that
    SHOULD have led to higher prices.

    There was good economic news, as there has been for the last two
    weeks, but the bears decided we needed one more shakeout after the
    last two light trading weeks.

    Todays trading was heavy and all pointed south as we saw better than
    80% selling pressure.

    How much lower now?

    The logical place for the DOW to find footing is at 9600 which isn't
    that far away now.

    Was there any good that came out of yesterdays action...absolutely.
    Those worrisome gaps on the SP500 and the NASDAQs finally got closed.

    Most longer term traders, including us, expected to see a challenge
    of the resistance levels around 10250-10300 and 1106-1127 BEFORE a
    market takedown, which would then have pointed to an even deeper and
    longer selloff later in the year. By selling down to support BEFORE
    challenging resistance levels sets the stage for a totally different
    upside surprise potential.

    Yesterday smacked of a lead-in to capitulation, which once sensed by the
    big boys should trigger the next wave of buying, first for short
    covering and momentum plays, then real investors if they are
    satisfied that the bottom is truly in place.

    We are of course even further oversold, with the VIX sitting at the
    top of the Bollinger Bands and all hourly and daily RSI readings at
    bullish levels, (contrary indicators).

    Proxy Traders saw conditions right to confirm a buy signal on the
    NASDAQ proxies on Friday. This is the first signal since December of
    2000. This means the the Institutional traders are now net-positive
    with a 53% bullish stance. Will they increase their long positions
    tomorrow?...remember, these guys are in for the long haul and don't
    make many mistakes.

    They have managed to keep above the 50% level for three weeks
    running, indicating that they are buying in the face of the recent
    selloff. Historically, they usually buy in about 4-6 weeks early,
    preferring to take a big chunk out of the middle of the profit stream
    and less worried about calling the absolute bottom.

    Our Mutual Fund position has held up quite nicely through this last
    selloff, closing at 57.47 near its highs, up from 49.97 as of the
    first of the year.

    Todays support/resistance levels for other indices:

    Support: 1026
    1130/1144/1153/1175/1199 NASDAQ COMPOSITE:
    --------=======YESTERDAYS TECHNICALS=======-------------
    CBOE PUT/CALL=.69-
    OEX PUT/CALL=1.40-
    McClellan Oscillator= --117-
    NYSE= +1529-
    NASDAQ Comp=down-
    NASDAQ 100 techs=down-
    PITBULL CRASH INDICES:see web page chart.
    NEW LOWS, NYSE=60-

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