The View; “Explosion Of Greatness”

It was all about the commodity stocks yesterday, the top 5 ETF’s based on yesterday’s performance; GDX, XOP, XES, SLV, XLB, XLE.  The XLE is now up 8 days in a row, 92% of the stocks within the ETF are trading above their 10 day moving average, 100% of them are trading above their 50 day and the XLE closed above its upper bollinger band.  To put it in a simple way, if you wanted to fade this market, I would look here first (XLE) as I believe that this type of set up as a high probability in the ultra short term.  Yesterday’s bottom 3 were; SMH, EEM, XLP.

On a side note from SentimenTrader; “According to the Hulbert Financial Digest, newsletter writers are recommending an 81% net long position in the Nasdaq Composite.  That’s the highest recommended exposure since July 2000.  The next highest recommendations were 79% in late December 2004 and 80% in late April 2010.  Both led to multi-month corrections.”

Also the $OEX  P/C ratio 10 day moving average  has been over 2 for the last 4 days, the last 3 times the 10 day average was over 2 were 10/8 – 10/15/12,  9/10 – 9/17/12  and  1/6 – 1/12/12, 2 out of the 3 were pretty bad for the market.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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