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Kevin Wilde
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Kevin Wilde is the chief trading strategist at alphaking.com and a Marketocracy.com Master. Investors can follow his trading advisories via his Daily AK newsletter, or have their money run for them via Marketocracy.com money management services, where Kevin's trades will be automatically entered.
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  • Blow-Off Bull Update...Nail biting decision expected soon...

    Nothing has changed with the intermediate term trend, with the stock indexes continuing to hold support as the bulls attempt to hold the rally into end of month and quarter. All bullish bets are off if current support is breached, though so far so good in that regards. Unfortunately, the semis (SMH) and NASDAQ 100 ETF (QQQ) are showing little technical signs they are about to go on the breakout run that is needed to nix the very dangerous set-up we face as we start the second quarter next week.

    I use the short term trading indicators shown in the chart below to help prune positions in my portfolios, with the current set-up showing little in the way of new information we can trade off of. The last trade - the new buy marked by the yellow circle far right top portion of chart - worked well, as the movement out of higher beta stocks into more conservative lower beta ones highlighted an extreme oversold condition in the short term last week.

    That trade has run its course, and all of these overbought/oversold contrarian indicators remain in the waffling middle, which is the same situation with the VIX and McCellan lines moving around Bollinger band extremes (bottom portion of chart.) While the McCellan did move closer to the new buy line a few days ago, it has since moved back toward the waffling middle without triggering a new trade.

    So we await the bull/bear decision where either current support gets taken out and the bulls all try to exit at the same time - can we say, swoon! - or the Qs and SMH catch a bid and the bears panic buy to give the blow-off one final surge 10-20% higher than current level.

    Kevin

    f you would like a six month free trial to my alphaking newsletter sign up for the 30 day trial at alphaking.com, click on the verification email, and we will adjust to six months. I run four tracking portfolios - so lots of stocks to buy and sell! - as well as a 401K advisory for those looking to make and protect money in their retirement nest-egg.

    (click to enlarge)

    Disclosure: I am long QLD, SMH.

    Tags: SMH, QQQ
    Mar 28 10:45 AM | Link | Comment!
  • Decision Time For The Bulls And Bears Right Here....

    We are fast approaching the moment of truth where the Qs and SMH either breakout to new highs to panic the bears into capitulating, versus a failure to get the breakout job done later this week, early next, likely to open the selling flood-gates as the bears, emboldened by the failure, move in for the kill.

    If the Qs and SMH do breakout then I would expect an explosive rally to unfold in April that drives the trend trading indicator at the bottom of the chart below across the high risk - exit - line, which will be my cue to take profits on longs, in a replay of what happened last spring, marked by the orange circle.

    If the Qs and SMH fail to panic the bears, then I believe danger is super super high that the stock market will suffer a plunge from extreme overbought conditions to an extreme oversold one, similar to the two prior examples of rally failures marked by the red circles next to the blue ones.

    The blue circles highlight how the stock market can remain in the extreme overbought camp for prolonged periods while the ADX line is rising. The red circles highlight what happens when the ADX turns south while the stock market is overbought. The green circles show the buys once stocks reach oversold levels when the ADX is falling. The current ADX is waffling sideways, getting ready to move deliberately in one or the other direction.

    So, in short, I believe the next 2%+ day - either up or down - will set the direction of the next 15-20% move for stocks, with that decision likely to be made later this week, early next.

    Kevin

    If you would like a six month free trial to my alphaking newsletter sign up for the 30 day trial at alphaking.com, click on the verification email, and we will adjust to six months. I run four tracking portfolios - so lots of stocks to buy and sell! - as well as a 401K advisory for those looking to make and protect money in their retirement nest-egg.

    (click to enlarge)

    Disclosure: I am long QLD, SMH.

    Tags: SMH, QLD, SPY
    Mar 27 7:37 AM | Link | 1 Comment
  • Another Week Or Two Of Rally Now Underway

    The pullback yesterday - on very low volume - leaves the stock indexes in fine shape for a rally into the end of the trading month on Thursday, which also marks the end of the first quarter. Any such rally has the potential to continue into the week after, and such window dressing buying at month and quarter end and beginning should be the prime driver of stock prices between now and then.

    Nothing has changed with the divergence/confirmation chart below, with volume and SMH lines failing to confirm the rally, while new highs, transports, and weekly ADX do. SMH and volume line breakouts above their red lines of prior highs are needed to drive the broader stock market rally higher, and I intend to be out of all stocks and ETFs next week if such breakout confirmation fails to land before then.

    Kevin

    If you would like a six month free trial to my alphaking newsletter sign up for the 30 day trial at alphaking.com, click on the verification email, and we will adjust to six months. I run four tracking portfolios - so lots of stocks to buy and sell! - as well as a 401K advisory for those looking to make and protect money in their retirement nest-egg.

    (click to enlarge)

    Disclosure: I am long QLD.

    Mar 26 11:50 AM | Link | Comment!
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