The Sunny Side of the Street
Figure 1- Daily Dow [click to enlarge]
| symbol | Upper Attractor | Lower Attractor |
| INDU | 9075 | 7650 |
| QQQ | 28.4 | 21.93 |
| SPh03 | 875 | 815 |
| GC | 445 | 270 |
February 24, 2003
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| Nasdaq | S&P 500 |
Figure 2- SPY 5-minute
Sunny
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The Sunny Side of the Street |
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Figure 1- Daily Dow [click to enlarge] |
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| MONDAY NIGHT - February 24, 2003 |
xx | Visit (and frequent) the new SSS Bulletin Board where you can post messages for Sunny and for other subscribers. | xx | ||||||||||||||||
| The market is stuck between a rock and ha hard place. The Dow is still being pressured by the overlapping cycles, bring the market on down until we reach 7250 or April 25, which ever comes first. Until then, overhead resistance keeps coming in and pushing the markets down while all we can do is a little bit of shorting and |
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| a lot of sideways channel trading. The channel on the Dow is from 9075 down to 7250, where it seems to be headed right now. The Average True Range (ATR) is diminishing diving each move narrower and narrower range to work within. The current tiny range is between 7650 and 8027, if you want to see if you can play with that. I don't want to play in a range that small. You can see in Figure 1 that the inside cycle has crested and is on the downsloping side now, giving further impetus fur the Dow to take a dive in the near future. I expect we will play with 7650 a bit before capitulating and dropping all the way to 7250 in one last gasp. | |||||||||||||||||||
Figure 2- SPY 5-minute |
By my way of interpreting the chart to the left (Figure 2) the model got short just before mid-session and stayed short for the rest of the day. How can that be?, you ask. There are buy and sell arrows all over the last part of the day. Well, I judge them meaningless because they occur within a period when the Sunny-Bands are moving sideways, and the latest pennant has not been broken. As each successive pennant forms along with the down move they just confirm the current trend. Price doesn't come back up and negate any of those pennants. But when the | ||||||||||||||||||
| Trend starts getting sloppy and the Sunny_Bands are moving sideways near the end of the day, I ignore all the buy and sell signal, waiting for a significant breakout above one of the pennants. The last trendfollowing pennant was formed between 9:30 and 9:55, with its top on the QQQs placed at 24.93. I held onto the short position waiting for price to break the 24.93 line, and it did not, so I stayed short. I am now holding overnight, waiting to see how tomorrow opens. If it gaps above the 24.93 level I'm out, if not, I'm still waiting for a new pennant to form with a lower boundary. I'll discuss this some more on the BBS in the morning, if anyone shows up to chat. | |||||||||||||||||||
| As always, stay nimble and quick. And
never be afraid to take profits even if it seems early. They add up.
May God bless you, that you might bless others.
Sunny |
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