Monday, June 8, 2015

Looking for a Hairy Bottom....06.08.15

Indications are that the current "correction" may not be over yet.  Here's a 2 hour bar chart of SPY looking back to late April and if history repeats itself then 207.30 is the real test of SPY support.
Despite the lousy NYAD readings of late and the dominance of the TICK below the zero line what WE HAVE NOT SEEN is a sustained NYAD reading around 10 or the very low teens and a high volume wash out day.  Those are the parameters that typically set up a "hairy bottom" such as around May 1 and May 7.  Tuesday's are occasionally dubbed "turnaround Tuesdays" due to the historical penchant to be key reversal days.  Such an event may or may not ensue tomorrow.  If such does come to past just be aware that new lows tend to revisit within 30 days.  It's summertime and the momentum is negative.