Chart of the Week from TLP

Site Administrator | February 20, 2012

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Enjoy the following from TradingPub Commentator, Tony LaPorta!

I put out my 1st TLP “Gut Trade” of the year this week. I wrote on Thursday night; the TLP “Gut Trade” states; when a market does not do what you think it should do…i.e…in this case go down, you close your eyes and buy it. Something is up. Someone knows more than we do. I feel there is going to be some kind of big European bailout announcement soon…maybe this weekend. And all the players…that being the major banks of course have already gotten the early wink.

I put out better “Gut Trades” in the past, but I don’t feel this one has totally played itself out just yet. I was and am thinking we get more follow through over the long weekend. I am looking to sell into strength and get short big time on Monday night/Tuesday morning.

I see the Chinese cut bank reserve requirements by 50 basis points. I am also reading bits and pieces about a possible German agreement of a 2nd Greek bailout. Finance ministers meet in Brussels on Monday. I would think the Chinese news would be Wall Street friendly. You never know how the Greek news will be received by the markets. Will there be a deal in place or will the finance ministers employ more stall tactics after the Monday meeting?
Whatever happens…the old saying goes, timing is everything. My Trading System has been giving me sell signals for the last three weeks in the indices, indexes and individual stocks. If we have not seen a high for the move just yet, we are damn close.

I love when NQH leads. While ESH and YMH traded to new highs for the move on Thursday and Friday, NQH did not. NQH is also giving us a Bearish Divergence signaling a minimum four to six-week correction is in the cards. RSI’s in all the indices still remain in overbought territory. Timing…Timing…Timing.

I have kept an eye on the Dollar Index chart for quite some time. With the Dollar turning higher this week, it appears that a Right Shoulder has now been built on a weekly chart. I will continue to provide this weekly chart in my weekend commentaries. I will also start providing a daily Dollar Index chart in my Monday – Friday analysis. I will keep a very keen eye out for the breakout level at 8210 and report to you all daily. Both the daily and weekly Dollar index charts have been provided in this weekend commentary.

Considering the indexes posted more solid gains this week, the losses in the treasury complex are minimal. Support lines in ZBH were broken, but Friday’s follow through lower was of little significance telling me to beware of another false breakout lower. ZNH held the support line and bounced. I am looking closely at the holiday Monday trade. If I can buy the treasuries lower on Monday night/Tuesday morning, I will be back on the bull again.

Tony was also kind enough to offer a substantial discount on his market commentary for TradingPub patrons which can be found here:  Tony’s Commentary.


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Risk Disclaimer: Past performance is not indicative of future results. Futures trading involves substantial financial risk. Views of guest commentators do not represent those of  Article intended for educational purposes only and not meant in anyway as a solicitation to buy or sell certain securities.  Please consult your personal financial adviser before using this information for your own trading purposes.