Don't Buy Yesterday's Hype

While yesterday felt strong as there were some nice gainers across the board, the close felt very forced and tired. Lacking new leaders and hardly any stocks hitting new highs I smell exhaustion. It seems that many smaller priced speculative stocks (FEED, APWR) are making parabolic moves and that can often be a sign of a market getting ahead of itself. I’m not saying we’re going to hit new lows right now, I just feel that a more extended move lower is needed and I’m sticking by my recent call that this market is weakening, not strengthening.

Divergences continue to widen on this chart. What appears to be a strong day on the surface has the TRIX moving still lower.

On a weekly chart we have the TRIX turning lower and this generally signals a move lower coming, especially on the heels of a 30% monthly rally.

Comments

[Ranger:]

Are you ever right?

Apr 22 08:58 AM

[joethebull:]

It's a trap. Today's minute-by-minute action looks like a bit of manipulation, but I agree with Jeff that we're heading for a correction. Remember how analysts say that bad news is baked into the current price evaluations?

Let's just say that good news is already baked into the current price evaluations as well.

Apr 22 02:59 PM

[BigJake:]

Does anyone else wait until 3:50 PM before making any trades? It seems like since January the most violent action one way or the other occurs in the last 5-10 minutes..... Am I just behind the curve and everyone does this or is there some reason for it that I don't know about?

Apr 22 04:09 PM

[joethebull:]

Computer activity tends to pick up in early morning or late afternoon trades.

Apr 22 04:25 PM

[Paul_L:]

Jeff has been right more than not. The market sold off at the end of today, 4/22. He also has great insights published at his web site. Thank you Jeff.

Apr 22 05:39 PM

[snippy:]

At least somebody is following the charts ,you can not predict human behavior ,at least the charts can.

Apr 22 06:20 PM

[Hmm?!:]

Ranger,

Having followed Jeff for a while, I will say yes, and often!


On Apr 22 08:58 AM Ranger wrote:

> Are you ever right?

Apr 22 10:37 PM

[Hmm?!:]

Yes. Often.

I have been given some mutual fund explanation in the past? Because they are bound by certain rules so they often deal with large sums?

They probably also consolidate their morning and afternoon orders. They would need to know any liquidation requirements from their customers.

On Apr 22 04:09 PM BigJake wrote:

> Does anyone else wait until 3:50 PM before making any trades? It
> seems like since January the most violent action one way or the other
> occurs in the last 5-10 minutes..... Am I just behind the curve and
> everyone does this or is there some reason for it that I don't know
> about?

Apr 22 10:42 PM

[Jeff Pierce:]

Thanks everyone for the endorsement. Timing the market is not about being right all the time, but being right when it counts. Of course I'm wrong every now and again Ranger, but my timing system kept me out of every major decline last year and 08' was a difference experience for me than most.

Best of luck to all in these volatile times.

Apr 23 09:37 AM

[cash:]

Amen, Paul_L & snippy. Jeff's posts are as good as any others I have read. I "pay" for a newsletter that asked me to keep buying the dips in 2007 & 2008. Thank goodness, I did not follow their "advice"! Keep up the good posts, Jeff!

Apr 23 12:36 PM

[joethebull:]

For those who are checking back here, we just failed today's test. Hit a swing point, went above, rejected the new highs and fell back down. Look for some correction next week.

Apr 24 04:22 PM