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Michael Noonan Edge Trader Plus Michael Noonan is the driving force behind Edge Trader Plus. He has been in the futures business for 30 years, functioning primarily in an individual capacity. He was the research analyst for the largest investment banker in the South, at one time, and he... More
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  • SnP/NAS - Follow The FED Brick Road 0 comments
    Feb 10, 2013 10:23 PM

    Sunday 10 February 2013

    All we can do with the stock market indices is draw a few lines and
    then draw a few conclusions. It was easier with the SnP, but we
    had more words to add for the NAS. The stock market has been
    Fed-driven for the past few years as central planners have taken
    over, so we no longer see free markets, as more and more freedoms
    in other areas are being trampled over by puppet politicians.

    Sometimes there is no need for any sophisticated computer models
    of myriad mechanical tools like MAs, RSIs, MACD, etc. All one need do is follow the obvious for as long as the obvious remains so. At
    least that is how central planners seem to work.

    Buy breaks and hold until it stops working.

    SPH M 10 Feb 13

    No comment required.

    SPH W 10 Feb 13

    The Fed used to run monetary policy, which has not worked in over
    100 years, so now they are running the markets, along with
    everything else.

    SPH D 10 Feb 13

    At least the NAS has more points of interest against which to gauge how price responds to them. The long-standing half-way
    retracement between the 2000 high and 2002 low has been 2841
    ever since the 2002 low. Last September, NAS tested it and price
    backed off. Notice how small the range was. It reflected a lack of
    demand, and selling stepped in, at least for a few months.

    The last two months are small ranges, a lack of demand, but there
    has been a total lack of supply, so as long as price goes higher,
    stay with it. Close stops at this late stage would be a good idea.

    NDH M 10 Feb 13

    Small bar rallies can mean a lack of demand, but when they persist,
    as in the November 2011 to April 2012 rally, the steady grind higher
    is the market's way of punishing shorts who know no better than to
    ignore a simple trend. Tuition for ignoring trends is so high for so easy a concept.

    We see another small bar rally since January 2013, but the slope of
    the rally is shallower, and the bars are overlapping. Overlapping bars tell of a battle between buyers and sellers, but buyers are still
    winning. Whatever strategy one might have in stocks, staying away
    from the short side should be at the top of the list.

    Wait and see HOW price responds to the 2872 highs. Then, you will
    be better informed as to what the market is doing, eliminating any
    guesswork. Guesswork also has high tuition costs, but they are at least voluntary.

    NDH W 10 Feb 13

    Price could have gone either way out of the 27 day TR, but the
    smart money was on the upper end for a resolve. You had the SnP
    as a guide, and the fact that the NAS TR gave back so little ground
    during the corrective phase suggested accumulation.

    How price responds to the overhead resistance, which everyone
    sees will be valuable information in formulating the next plan. Do not change the current one, unless it is on the short side.

    Hard to ignore such an easy message in these two markets.

    NDH D 10 Feb 13

    Themes: SnP, NAS, DOW, Stocks
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