KCPO - Got Out Without Crying Over Spilled Milk - 11/28/2011

 

A beautiful aspect of technical analysis is that unlike fundamental analysis, it allows users to switch sides without thinking of "WTF !!!!!". Last week as I was getting overly excited and expected the market to get further upside mileage , then the market came down hard. But as soon as prices close down below the top Bollinger Band, I closed off all the long positions. And when the Stochastic crosses down its 80's signal line, I engaged new shorts. All done WITHOUT  any emotional attachment of when one is to apply fundamental analysis. Fundamental analysts just cannot get over why the market "fundamentals" change over so fast.

Both the Stochastic and MACD have turned negative and going down. DMI is about to turn negative. The ADX is turning down from above the DMI, this is confirming the end of the prior trend.  Place stop at last 2 days high plus some.

 

The weekly chart's Stochastic and MACD continue to rise, but DMI has gone negative. ADX is still falling , even though this is confirming the end of prior trend but this is also telling us there is no trend yet. Price has closed below the upper band which is an initial  bearish sign. On the weekly chart, I would need to wait for another 1-2 weeks before I can arrive at a more conclusive opinion.