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Charlie Anderson
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I am currently a student. I use a mix of technical and fundamental analysis to arrive at investing prospects and then do in-depth analysis.
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  • Market Update, 3-11
          The market continued its ride up today. I am still learning, just like everyone else in the world, and thought that this ride was over a little prematurely. I lost a little bit of money today on that call. However, the market did reach a very critical point today: 1150. After opening lower, puddling along, and finally breaking out in the last hour of trading, the market closed up .4% at 1150. I have talked about this level numerous time in my previous posts, and I will continue to do so.

         The market stalled its collapse around this level last October, and failed to break it this January. Let us also note that many of the technical indicators seem to have topped out, and either there will be another breakout tomorrow [unlikely] or the market will once again top out at this level and start a down segment next week. At this point the montra is "wait and see." If the market gaps up above 1150 tomorrow, we may be in for a good continuation of this up segment. Conversely, if it fails to do so, we will likely see the beginning of a down segment. I won't pretend to know which way it will decide to go, although it is more likely down. I do know this though: Tomorrow will be interesting. 

    Disclosure: I am long SPXU, the -3x S&P-tracking ETF
    Mar 11 8:22 PM | Link | Comment!
  • Market Update, 3-10

    Today we saw something that was interesting, but not altogether unexpected. I stayed out of the market today because I wasn't completely sure that today would be the turn. That was prudent, I would have lost a fair amount of money. However, today further ingrained in my mind that this is the top.

    The market broke the little resistance at 1145 on its second try of the day, and proceeded to flirt with the line all day. It didn't reach the golden 1150 level, but puttered along in the 1140s. The market has risen up into the upper 1140s as I expected it would this weekend, and now this is the end. It may go up or down a little bit for the rest of this week, but I'm betting on a significant correction starting this week or next. Here's why.

    For starters, the S&P RSI and stochastics have topped out. The RSI is so close to 70 that it would be astonishing to see this continue upwards for more than a few days. Also, the stochastics have rolled over and are going from the mid to the low 90s, even though the market is going up. This suggests that the price movement is unsustainable. The market has reached a huge resistance level and is showing little strength in breaking it. Also, trend lines drawn along S&P tops over the last year suggested that this market peak would fall horizontally to the last one; right at 1150. The volatility index also has turned. It went up over 3% today, and went up both of the last two days. This suggests that although the upswing has continued this week, investor confidence in its sustainability has gone way down.

    In conclusion, the market looks poised for an unsuspected and large correction over the coming weeks. Look at my previous post discussing support levels to see how far you think it will fall, because I'm not going to speculate on that.

    Happy Investing!


    Disclosure: I am long SPXU, the -3x S&P ETF
    Mar 10 4:21 PM | Link | Comment!
  • Market Update, 3-9

         As expected, the market rose over the first two days of this week. Monday the market showed much less certainty than I expected, which was very bearish. However, Tuesday, the market seemed bullish and went up .6%, only to crash down to -.1%, and finish up .2%. Overall, this uncertainty is very telling.

         It is very minimal and hard to distinguish looking at a chart, but there is some resistance for the S&P 500 at 1145. The main resistance comes at 1150. Today, the market came up to this resistance point and was not able to break above it. This is bearish. However the market still ended up for the day.

         Also of note are the stochastics, which have almost definitely peaked. The RSI has also come close enough to 70 that a turn around should be expected quite soon.

         In conclusion, it looks as if today was the market's top for this uptrend. It may consolidate and try to break the 1150 mark, but I doubt it will. The question will become how far the market will fall. It should see support at 1131, then at 1118, after that at 1085, and if it gets really bad there should be support at 1050.

         I believe that the market should either move sideways or down tomorrow. It could move up into the high 1140s or low 1150s, but if it does that will almost definitely be the end of the upswing. The stochastics turned south today, and the RSI planed off.

         If we do not see a turn-around tomorrow, it will come on Thursday, and at the least we will see downwards movement by the end of the week. The world doesn't know it yet, but this rally is over.

    Disclosure: none
    Mar 09 8:40 PM | Link | Comment!
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