Here are a pair of charts from Ron Griess at The Chart Store. Taken together, they show potentially fading momentum for the rally.

As noted last week, I still believe the rally is “Innocent until proven guilty,” but this is worth watching:
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S&P Financial Sector

12-18-09 Daily S&P Financials Swing

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S&P 500 Weekly Momentum

12-18-09 Weekly S&P w-MACD

Category: Technical Analysis

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

7 Responses to “As Financials Fade, S&P500 Loses Momentum”

  1. call me ahab says:

    the MACD crossing the trigger line- not usually a good sign

  2. it’s been looking like it is Rolling-Over

    Roll-Over, anyone taking bets on a “GOOG Analytics” usage spike for that term?

    also, think USTreas Complex, and U$D ~2.5 Tr needing to ‘rollover’ in ’010..

  3. CTX says:

    Good stuff but shorts still dont work

  4. call me ahab says:

    CTX-

    re shorts- I think shorts were the fuel for much of this rally- all the short covering in heavily traded inverse ETF’s-

    now we’ll see what the market can do without all the shorts to kick around anymore

  5. Pocket QQ says:

    It’s an option writers paradise!

  6. OkieLawyer says:

    I thought the same thing back in June, but it found newfound strength somewhere. Green shoots?

    What a time for it to start heading down. Just when I am expected to get back to work in January; which means of course I will be buying at the top for my 401K.

    What’s that theory about it causing the most pain possible?

  7. eren says:

    i was trading 3xs heavily till this e-mail:
    “Nov 24, 2009

    Important – ETF Margin Change Imminent

    Dear Trader,

    Please be advised that effective December 1, 2009, an increase in margin requirements for leveraged ETFs, and uncovered options on those leveraged ETFs, is being implemented by FINRA (Regulatory Notice 09-53). These changes will apply to Reg T (strategy-based) Margin accounts and Portfolio Margin accounts.

    Your account has been identified as an account which, based on current positions and current market conditions, will be in margin deficit when the increase is applied. Please manage the risk in this account accordingly. An account with a margin deficit is subject to immediate liquidation to meet that deficit.

    For further details, please see the following link:

    http://www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p119906.pdf

    Regards,

    Interactive Brokers Risk Management

    I am not buying or selling anymore 3Xs since the margin calculation is completely screwed.