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09/12/11 Market Action

|Includes: SPDR S&P 500 Trust ETF (SPY)

The market remains volatile. I still feel it is an environment best suited for very short term traders (day traders). The news headlines continue to move this market. News late in the day seemed to be the catalyst for the late day rally. I will be looking to see if the 114 level on the SPY can hold. I would get slighty more bullish (in the short term) if we can break and hold above the 121 level on the SPY. I feel that it is unlikely given the longer term charts look pretty Bearish (see chart below). The 50 day (yellow), 100 day (blue), and 200 day (red) moving averages are all declining. The chart pattern does not look bullish. I think there still needs to be more of a correction through either time or price. One has the be flexible especially in this environment and if the market (NYSEARCA:SPY) can hold above 121 my opinion at least the short term time frame would change.


Rahul Parikh
marketharmony.blogspot.com