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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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  • Divergent DANGER, DANGER, Will Robinson

    The rally off recent lows was impressive in many regards, and way lacking in others.

    The rally was strong enough to reverse short term oversold conditions to the opposite extreme, with the short term indicators now signaling new sells.

    The first chart is the short term indicators - yellow and red circles the new sell signals - and following them last year made 33.6% trading the S&P500 without leverage (two signals from any of the indicators in the black boxes to trigger entry, one signal in opposite direction from any indicator to exit the trade and move to cash.)

    (click to enlarge)

    The second chart below shows many red divergent arrows from the leadership groups, with only the semiconductor sector and the McClellan Summation index confirming the current rally. This significant divergence is occurring for the first time since early 2012.

    I am cautiously long the market (50% long) - as trends are positive - though the short term overbought condition, matched with divergence of many leadership group, while the stock indexes are in or near double top position, says to be very wary of any new trend change going forward, as the bearish potential is getting stronger by the day.

    If you would like to track updates on the charts shown below sign up at alphaking.com, click on the verification email, and get THREE months free access to my on-line newsletter.

    -Kevin

    (click to enlarge)

    Disclosure: I am long QQQ.

    Tags: QQQ
    Feb 19 8:17 AM | Link | 2 Comments
  • Trends Confirm Tom DeMark's Crash Call

    Tom DeMark has been warning about a crash since last October, and he was on CNBC this morning reiterating his concern as the charts have played out exactly as he expected during the October-Jan rally, and the subsequent reversal.

    The chart below is how the Dow Industrials stand after Monday's pummeling.

    (click to enlarge)(click to enlarge)

    Everything but munis, US bonds, and gold are now in downtrends, including the all important yen carry trade, which is what one would expect to see if Tom DeMark 1929 repeat is correct.

    Trends: semis -, transports -, small caps -, energy -, China -, gold +, UK -, financials -, copper -, high yield -, munis +, US bonds +, emerging markets -, Yen carry trade -

    I am looking for a short term bounce to alleviate the short term oversold condition - probably to the 50 day moving averages for the indexes, similar to the bounce shown above - though the stock market would look dire after that, with any failure to muster a rally now even more dire, if that's possible.

    f you would like to track updates on the charts shown below sign up at alphaking.com, click on the verification email, and get THREE months access to my on-line newsletter for free!

    (click to enlarge)

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in QID over the next 72 hours.

    Tags: DIA
    Feb 05 9:55 AM | Link | 7 Comments
  • TA Moment Of Truth

    Trend Watch --

    Trends: semis +, transports +, small caps +, energy -, China -, gold -, UK +, financials +, copper +, high yield +, munis +, US bonds +, emerging markets -, Yen carry trade +

    The trend momentum power rating has slipped a notch to a 70% bull.

    Energy joined gold, China, and emerging markets in sell mode this week, with many other indexes breaking down ahead of potential change in trend.

    Next week should answer the question of whether the top is in, or near the corrective low that proves to be a great buy the dip moment.

    If you would like to track updates on the charts shown below sign up at alphaking.com, click on the verification email, and get THREE months access to my on-line newsletter for free!

    High risk blow off phases are like this - quick rallies that soon falter, resulting in a corrective swoon, that takes off again just when the bears think are about to feed, until the bulls fail to prevent the bears feeding, then the top is in and all hell breaks lose.

    Next week should provide the answer to the new bear versus buy the dip! conundrum.

    The first chart below - which is my forecast for 2014 - shows the bear potential, as the Dow Industrials are reversing hard after struggling at the upper trend-line of an expanding triangle, with the dotted red line my expectation of what happens once the stock market starts to reverse for real.

    This is based on the rules of triangle analysis, as well as the position of the bull/bear cycle.

    (click to enlarge)

    The next chart shows the current S&P500 performance to start 2014 (black line) matched against the orange line expected in high risk blow of risk phases. The position of that black line is subject to change, as it uses monthly data.

    Currently the S&P500 is tracking between the yellow line of moderate churn years and the maroon one of extreme risk - new MAJOR bear market underway - one.

    How January closes out - next week! - should set the S&P500 on the path it is likely to take for the remainder of 2014.

    (click to enlarge)

    The next chart shows the trend - up - confirmed with a new sell from the hedging indicator - I am buying TZA as a hedge (10% of total portfolio value,) with the trend trading indicator at the bottom of the chart moving into the low risk - enter (longs) - zone.

    Low risk in this regards means losses are likely to be very modest if the trend turns south for real, rather than any bet on probability of stocks heading higher from here.

    And to top this situation off where next week answers the question of whether the stock market heads on its next rally phase from this position, versus the bear starting with red ink for January as the month closes, the FED have a two day meeting - when taper versus no taper is warred over (again) - all landing with $16 of FED QE bond buying to help sooth the pain of their decision.

    Needless to say, we have the fuel for next week to be quite spectacular and volatile, though the direction of the fireworks is very much in question, with the fate of 2014 in the hands of eager bears and nervous though greedy bulls, as well as a clueless FED who have put their heads in a tight noose and asking, "shall we pull the lever, Janet?"

    Have a great weekend!

    -Kevin

    (click to enlarge)

    Disclosure: I am long SSO, TZA, .

    Jan 24 7:15 PM | Link | 3 Comments
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