So far so good

Finally bulls had the expected bouce and even surpassed ES1056 area. But as they didn't close above ES1060.5 we still can expect the continuation of the bearish move towards ES1028. If 1060,5 is taken out tomorrow then the target for longs is near Es1090 uffff!:)
Regarding GS setup obviously was bought today but as well as SPX bulls have not yet crossed the key level so bearish stance remains.

We will be looking currencies tonight for more clues on tomorrow action but bears need ES dropping below 1054 quickly to maintain hopes healthy



As another proxy you can use is QM, which is serving us well as indicator. Now we have clear references for the ST:

Seeking the unobvious (updated)

Turning point time guys. This last week has been really shocking but at least set something clear: Bulls are still in total control of this market.
I will post later my vision about different time frames and try to put all the pieces together in one picture. Meanwhile I brought this short term charts. The only objective is to balance the astonishing impresion that SP500 and some other indices gave us on Friday's close. I think some other indices and instruments showed less strength, at the close or in previous 2 days. This makes me think that on Monday/Tuesday we can have some correction (finally). After that correction I expect more buying pressure.
So this is bear's short term tiny hope as far as I can see :)


SPX- OIL/GOLD spread


SPX- DAX/SHATZ spread


SPX vs. USD comparison



6E . Euro future closing on Friday.



Nasdaq 100 future . See previous chart

Oil: Target hit

You may recall our recent post about Oil were we were anticipating a retracement inside a consolidation pattern.
XOI reached today its target zone (blue rectangle at 916). We hope you could make some profits from it :).
Though Oil is still in a main bullish trend, we expect more downside in the short term (see OIH chart). After the consolidation is complete we will re evalute to determine new targets.

XOI- reached 1st target.




OIH, showing weakness by gapping down and breaking support

Regression day II - Completing the move

As we recently posted , many instruments have broken its mid term regression channels. We spoke about the technical relevance of that fact and also described at the charts commentary that after the 1st step (channel breakdown) 2 more steps normally follows to complete the move :

• 2- Retest the channel or any relevant resistance
• 3 - Break down again

This is what we saw today at many instruments (see updated charts below)


EURJPY


EURUSD


S&P100


ES





Another perfect example at QM (oil future)



Conclusion:

The various indications we were observing about more weakness in the bulls run have been confirmed today in various equities sectors as well as oil and gold. We see this move as the beginning of a pullback inside a bullish main trend. To believe this pullback has become some serious mid term bearish trend we need to see a daily close below ES990, which was very close today but is yet to be seen. There are quite a few technical arguments for the bears but need to gain consistence during next week for us to officially turn the mid term trend to bearish.

Oil: short term view

Oil has starred in some historical moves during the last 14 months. Since its correlation with economy and equities performance is so important, I will do some short term analysis to find more support for the bear or the bull case.

XOI:
Is making lower highs and higher lows so until breaks highs is technically in a consolidation pattern inside a bullish mid term trend.




Close up:
Now it is facing a short term bearish trendline and 200MA wich failed to breach. Stochs favors more weakness. IMO it is due for a pullback to the blue rectangle area before anymore upside.


QM - NYMEX light sweet crude oil future


Edit:
Also check this USO P&F chart from the a great analyst and trader : Valeriobr. Very interesting setup!

http://www.flickr.com/photos/valeriobr/3811528520/sizes/o/

First post - some chart reviews

Some indications I am picking up here and there towars bulding a short position.

When analyzing NYSE data more relative strenght can be found but a brief look to Nasdaq and some internals reveal the rally is weakening and leaving an open door to a meaningful correction.

Nasdaq 100
My favorite index to watch when looking for trend reversals.



Market internals as of 07-30
Some divergences could be found that favor the ending of this rally









Oil- I used a oil-gold ratio chart to disect inflation factors. Though is not terminant, bearish signs are arising



A quick look at EU indices
FTSE 100



P/C ratios:
Extreme equities traders bullish sentiment like current has been faded by the market short after.