Charles Brown from CB3 Financial Group with another Charlie’s Market Minute Segment. In this segment he discusses the current state of the market and the effects of Europe.
You can find the original video and more at cb3.com.
Daily Stocks Introduction and Walkthrough
For those of you who are not familiar with iPad application Daily Stocks and the robust functionality it provides please take a look at the short video below.
Learn more about Daily Stocks or Download it Directly from the iTunes AppStore.
Buy SPX 05-14-2012
TACTICAL SUPPORT IN PLACE: CHANGING OUR MARKET DIRECTION TO BUY
On May 11th, our statistical arbitrage model reiterated its sell signal for the S&P500 index. While the market behaved parallel to our expectations on Friday and so far today (Monday 14th), our most current statistical signals actually start to indicate a bounceback from current levels, mainly 1,340, for the S&P500 index:
- Statistical arbitrage is now starting to signal buy. We are changing our recent view from further sell-off to buy as our mathematical model started to suggest that some major statistical indicators in our proprietery model do not show enough widening for further downwards moves. Additionally, our model currently does not signal enough dispersion in correlation matrixes, a typical behavior in times of panic and big sell-offs.
- Technically, for the S&P500 index, levels around 1,340 seem to be holding pretty well as a key, interim support level. While we earlier predicted that 1,292 is a level we might likely see during the second half of May, current market behavior actually indicates an upwards move.
Given the critical and continuously updated news flow coming from the EU (e.g., Greece crisis) and increased volatility in markets fueled by sharp decreases in the EUR/USD exchange rate, our expectations for an upward bounce back may again be a short-lived. So, we recommend our clients to remain very cautious when entering the market.
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Charlie’s Market Minute May 10, 2012
Charles Brown from CB3 Financial Group with another Charlie’s Market Minute Segment. In this segment Charles highlights how he uses Stock Arbitrage Trader and Daily Stocks iPad applications in his day to day analysis.
You can find the original video and more at cb3.com.
Reiterate Sell SPX 05-10-2012
REITERATING OUR SELL SIGNAL FOR 2 MORE WEEKS
Parallel to our May 3rd predictions, S&P500 index had a setback to 1,350 levels. Our statistical model forecasts more declines in the indexes. Even though, today, the market has started with a small rally, we think this reaction should be used to sell existing longs and even open some new short positions. In other words, the market upward move today should not fake our clients. Starting from Friday 11th, we expect a 10-day long bearish trend in the market:
- Statistical arbitrage continues to signal sell for the coming 10 trading days. Today, we will likely see some short covering and even maybe a small rally. However, according to our statistical model, the next 10-trading days (through May 25th) we will see a bearish trend in the market.
- Technically, we already hit our first target level of 1,350. However, we still believe that – given the uncertainty on the EU front and mixed economic data coming from all over the world – S&P500 might decline to 1,292 levels. For longer-term investors or long-only traders we do not recommend entering the market until May 28th, at which point the market might start to buy in some potentially good forthcoming news, including a potential QE3 from the Fed or a more settled atmosphere from the EU.
In summary, we reiterate our bearish view for next 2 weeks. We highly recommend you to remain cautious to early reactions in the market, as it may lead to fake rallies or breaks.
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Stock Trading Idea: Weekly Chart – MSFT
MSFT: WEEKLY CHART: Broke below long-term trendline. Technicals are bearish but the volume is not supporting a big move.
Charlie’s Market Minute May 7, 2012
Another Market Minute segment from an avid missingSTEP app user Charles Brown from CB3 Financial Group.
You can find the original video and more at cb3.com.
Stock Trading Idea: Daily Chart – C
C: DAILY CHART: Trading between long-term trendline and 200-day SMA. Watch this level for further direction.
Charlie’s Market Minute May 2, 2012
A technical view from an avid missingSTEP app user Charles Brown from CB3 Financial Group.
You can find the original video and more at cb3.com.
Entering An Interim Trading Range: New Signal For S&P500 Is Sell
In our April 27th forecast, our arbitrage model signaled an upward trend for the period through May 10th (and maybe even further). While relative strength remained high during this period (especially supported by the positive manufacturing numbers from the US economy) sudden changes in statistical measures indicate that we are entering a trading range with possible setbacks until May 9th:
- Statistical arbitrage signals sell for the coming 5 trading days. Our statistical model recommends selling the S&P500 for the coming 5 trading days. While volatility may rise during this period, possible setbacks may create significant pressure on the index. For possible large-scale setbacks, we recommend that you keep checking our Market Pulse page for potential reversals in the market direction forecast.
- Technically, we still do not see a major correction on the short-term horizon yet. However, potential selling pressure may push S&P500 index down to 1,350 and maybe further down to 1,292 levels. For longer-term investors (or more patient traders) who entered the market in Mid-April on the long-side, it may not be wise to close positions immediately, as we are not bearish beyond May, 9th as of today. For aggressive traders who choose to be short at this level, we recommend a stop-loss of 1,425.
- “Employed or not employed?” For the coming week, the US unemployment data may negatively surprise the market. Apart from the economic data, the market may not want carry a lot of risk through the weekend, at which time France will choose its new President. These uncertainties will likely increase volatility, thus willingness to unwind some positions.
In summary, we change our view on the generic market to a bearish trend for the coming 5 trading days.
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