MAgicTrx

MAgicTrx

The rSquared has gotten above .95 basis late october and basis early January and just today dipped slightly. This history shows is a warning for those who are long and for those who would ply the short side. This is not a time for complacency.

MAgicTrx

Well all the metrics would say this is a top. For the moment though stuck in the short term gravity channel. Will it take the number on Friday to take it down? Or something unforeseen before then? Stay tuned.

MAgicTrx

Monday offers a very interesting setup for SPY. It is above the zero slope MA of highs. Also the RSquared basis the October low is .955 and the January low is .959. The containment ratio since early November is about 4 and since January is about 3. I'm not sure I could fabricate a much more perfect short setup. There is temptation to put on a trade...

MAgicTrx

RSquared basis Late October and early January now around .95. This degree of complacency would likely be followed by a correction, possibly severe. The rsquared .935 basis the March 2009 low also potentially troubling.

MAgicTrx

Maybe we get a big old head here. Numbers later in the week provide a right shoulder? We will see.

MAgicTrx

105 days over the 25 day MA of lows. 4:1 generally not sustainable. It is the timeframe since the November low that is most disconcerting. Metrics since the 2009 low are somewhat overbought but not as desperately so as just since this past November low. Rsquared in the .95 area also troublesome though .97 can be found in history. This would be an...

MAgicTrx

SPY now really in the danger zone. An rsquared basis the November low of .953 precarious and susceptible. What will trigger the break? Not sure just know that I will have a basket of puts ready to go.

MAgicTrx

Well SPY is above the gravity channel so the natural direction to trade now would be short if the market decides to reenter the gravity channel a point or two lower. Let’s see if Powell doesn’t give it that impetus at 2.

MAgicTrx

I'll be long above the 8 day MA of lows (zero slope MA). Let's see if Powell puts the POW! in the yellow metal tomorrow.

MAgicTrx

100+ days now over the 24 day MA of lows. 4:1 ratio typically not sustainable. Also rsquared .9510 basis the November low. Let's see how far and fast we go to resolve these metrics. Will there be a cause? A number? Or just happen?

MAgicTrx

Monthly rsquared basis the 2009 low topped last month at .936 and has ebbed slightly since. From this level a declining rsquared is definitely something to take note of. Similar levels and behavior in 2000 and 2008 rsquared topping at .97 and .95. Basis the November low, daily rsquared is 0.95048. This is a very slight dip from Thursday. But again a dip of...

MAgicTrx

Well there was selling in the SPY today but the day traders bought it back up in the afternoon. I suspect though we are not done. .95 on the rsquared. A 509 close on the SPY would result in a lower rsquared. Happy PI Day! Tomorrow is the Ides. We will see if the market ends up like Caesar.

MAgicTrx

Well to me BITO very overbought and due for a correction. Be interesting to see then what happens going into BitCoin halving in April.

MAgicTrx

To me metrics like containment ratio and rSquared are just ripe for a significant correction. What will the numbers tomorrow and Friday AM bring?

MAgicTrx

Right shoulder or cold shoulder? Perhaps the next 3 days will enlighten us.

MAgicTrx

31 days over the 9 day MA of lows. At a 3+ containment ratio, I'd look for a decent short on that containment MA failure.

MAgicTrx

The 10 day MA of lows contains 13 days. This ratio is itself not that impressive. But the fact that it is now a zero slope MA does make me sit up and take notice. The pivot would be about 508. Will this market need more time to form a proper right shoulder or just plunge through? We shall see.

MAgicTrx

In the SPY a 15 day MA of lows gives us about a 2.5:1 containment MA and a 25 day MA of lows gives us over a 3:1 containment MA. There is a lot of potential energy ready for a downside move. April may be the cruelest month but there is definitely March Madness! Was Friday a reversal day?