Market Direction

Stocks Pro for the iPhone is Here!

We’re happy to announce an update for our incredibly powerful stock market app, Stocks Pro, that will make the app available on the iPhone as well. This brings real-time charts, streaming stock quotes, automatic fibonacci retracement line recognition technology, stock-specific news, a watchlist that syncs with other missingSTEP apps, and market news & momentum information all to your iPhone®. To learn more about Stocks Pro read our introduction post and watch our iPad app walkthrough.

Download Stocks Pro now via the iTunes App Store.

Stocks Pro for the iPhone Home Screen showing Fibonacci Line Indicators for popular stocks such as AAPL and AMZN

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Arbitrage Trader Note: Reiterate Buy S&P500 08/01/2012

RIDE LIKE THE WIND: REITERATING BUY FOR S&P500

As our clients have followed, on July 22nd, we signaled “buy” for the generic market when S&P500 index was trading at 1,339s. On July 25th, we also wrote that the upward trend may continue until August 2nd for which date our market model algorithm had indicated a sell-off. Parallel to our expectations, the market moved to 1,380, briefly hitting the key resistance level at 1,390. Now, however, our arbitrage model signals a continued upward trend for at least the coming 2-week period:

  • Statistical arbitrage continues to recommend “buy”. Our market model algorithm continues to indicate upwards move in the market direction for the coming at least 10 trading days. According to our models, there is about 77% probability of further upside movement.
  • Technically, we now see a potential re-test of the 2012-high, which was 1,422 for S&P500. This time we may actually see the break of this key level. For aggressive traders, our stop-loss level continues to be at 1,330.
  • FED & ECB? While the markets do not expect much surprise from the FED today, we think that we may see developments that were not priced in yet. Furthermore, the ECB’s move (especially after Mario Draghi’s speech last week) tomorrow will also play critical role in the overall market direction.

In short, we reiterate our bullish view on the generic market for the coming 2-weeks.

For instant access to the Arbitrage Model Short-Term Forecast check the MarketPulse screen of our apps or download one of our popular iPad/iPhone apps directly from the iTunes AppStore: Stock Arbitrage Trader, Daily Stocks, and Stock Signals.

Arbitrage Trader Note 07/25/2012

IS IT TIME TO BUY SPX DESPITE THE BAD NEWS?
As our clients have followed, our arbitrage model forecast for the generic market has been all bullish between July 13th and July 22nd. On July 22nd, we signaled a “sell” as soon as numbers came from the Asian markets. However, the same day, our model started to signal “buy” at around 11:00am EST while S&P was trading lower at 1,339s. Now, our arbitrage model signals an upward trend for the coming 7 trading days (until August 2nd):

  • Statistical arbitrage now recommends “buy”. Our market model algorithm now indicates an upwards move in the market direction for at least the next 7 trading days. However, beyond that point, starting on August 2nd (remember last year?), we expect a fairly strong sell-off at this point in time. So, we recommend our clients to remain cautious.
  • Technically, we may still see some selling pressure in S&P500 down to 1,330 and even maybe further to 1,292. However, the last two sessions’ rallies towards the market closes support our current short-term bullish view. On the upside, we see 1,390 as a key resistance point. Another key level is of course 1,422, the highest level seen earlier this year, even though we do not expect to test that level soon.
  • Buy with these headlines? Yes, EU debt crisis is far from being resolved; Yes, Greece continues to be a problem; Yes, Spain’s bond yields cannot continue at these rates, and YES, EUR/USD, UST 10-Yrs, German Bunds all speak clearly about the seriousness of the problems. Additionally, US earnings are not surprisingly very much on the upside. However, as you all know, a good part of trading success comes from correct timing and patience. While we continue to see a negative macro picture, we also see some potential intervention by central banks and additional solutions on the table. As the markets hesitate to sell, it may be an early decision to sell into this hesitation.

In short, we reiterate our bullish view on the generic market for the coming 7 days.

You can have instant, and regular, access to our arbitrage model short-term forecast with any of the following apps: Stock Arbitrage Trader, Daily Stocks, Stock Signals, and Commodity Trader.

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.

Get this market direction change instantly through your iPhone or iPad with Stock Arbitrage Trader. Learn more about Stock Arbitrage Trader.

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.

Get this market direction change instantly through your iPhone or iPad with Stock Arbitrage Trader. Learn more about Stock Arbitrage Trader.

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