by Jason Ng, Founder, Master ‘O’ Equity
The Star Trading System continues to give us all morning stars today despite the market being slightly down. This continues to show that the market may really continue upwards from here.
Bulls and Bears were tied today as markets ended marginally lower in a sideways movement. There was almost no fundamental reasons behind the action we saw today, purely the last of the bears struggling with the new bulls, resulting in an almost neutral day backed by a volume surge. Even though the market didn’t close up, the bulls have held their ground and still made a higher high and a higher low… a bullish sign. This struggle between the bulls and the bears may last a couple of days more before the market crawls upwards. Yes, I see this as a strong reversal point and that the bulls do have the strength to keep the bears at bay at last, however, I do not think we will see a surge upwards anytime soon but a gradual advance. This is due to the strained geo-policial and economical situation, so I am skeptical as to whether the market will resume the kind of bullish trend we saw previously even if the markets do continue up. Let’s allow the market to do the talking…
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by Jason Ng, Founder, Master ‘O’ Equity
I have been suspicious of the market dropping without the Star Trading System giving us any evening stars so far and suspects that this correction is not going to last long. Yesterday, the markets pulled up resulting in morning star formations and also gave us a full avalanche of morning stars. This is the correct behavior of the Star Trading System when a trend change is real and that is the predictive nature of the system beyond human intelligence.
FUNDAMENTAL ANALYSIS
Looks like the US Markets and world markets are one family now… one can affect the other. With the pull up in the world markets, the Dow rallied 157.18 points, posting the greatest single day gain since this rally begun in July 2006. Japan’s Nikkei stock average closed up 1.22 percent, Britain’s FTSE 100 regained 1.32 percent, Germany’s DAX index rose 0.92 percent, and France’s CAC-40 was up 0.97 percent. Internals were also great with advancers leading decliners by a mile. This rebound is therefore strictly a technical rebound based on investor sentiments…so, lets go look at the technicals…
TECHNICAL ANALYSIS
Today’s rebound was surprising and not surprising all at the same time. What was surprising was that I did expect the major indices to test their 200MA before rebounding in my post yesterday and seriously, I did not expect to see it so soon. What was not surprising was these; First, I did mention that both indices are coming up against their psychological support level of 12000 and 2330 in my post 2 days ago. Both the Dow and Nasdaq bounced off these levels. Secondly, I also mentioned that my proprietary option swing trading system, the Star Trading System didn’t support this correction with any trades to downside and suspected that this correction is not going to last. However, only one thing failed to please me today. The volume. Major reversal points should be supported by growing volume, like what we saw back in July 2006 when the markets turned into this bull trend. However, yesterday’s pullup ended in declining volume instead indicating that there was more interest in the correction than in this pullup. This is not to say that this pullup does not count as it did form the powerful morning star candlestick formation in oversold position at support level. This is a very powerful combination that usually results in a good reversal. So, how would I make sense of this? I would say I want to see a followup on growing volume tomorrow in order to confirm this morning star formation.
Discover How The Star Trading System Instantly Transform Complete Newbies Into Master Option Traders With This Objective, No Guesswork, Option Trading Strategy! Click HERE to find the secret of The Star Trading System.
Share and Enjoy:These icons link to social bookmarking sites where readers can share and discover new web pages.
Bulls and Bears were tied today as markets ended marginally lower in a sideways movement. There was almost no fundamental reasons behind the action we saw today, purely the last of the bears struggling with the new bulls, resulting in an almost neutral day backed by a volume surge. Even though the market didn’t close up, the bulls have held their ground and still made a higher high and a higher low… a bullish sign. This struggle between the bulls and the bears may last a couple of days more before the market crawls upwards. Yes, I see this as a strong reversal point and that the bulls do have the strength to keep the bears at bay at last, however, I do not think we will see a surge upwards anytime soon but a gradual advance. This is due to the strained geo-policial and economical situation, so I am skeptical as to whether the market will resume the kind of bullish trend we saw previously even if the markets do continue up. Let’s allow the market to do the talking…
