Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Thursday, August 26, 2010

Waiting on Bernanke

click on above images to enlarge

Today's trading gave back most of its breakout gains from yesterday and has drifted into waiting mode to see if Bernanke can pull a rabbit out of a hat tomorrow.  In the upper chart cluster, we see both the bonds & vix are still in their uptrend. 

In the lower chart cluster, the only real changes were in row 2 where I drew in a pink line channel showing what they will be trying to work tomorrow if Bernanke's overall speech is taken as neutral overall to the markets.  Directly below in row 3 chart 3, we see that right after the open the advance decline hit the medium red line sell area and rolled over for the rest of the day.  It did stop in the last hour at the small green line buy zone but considering the fed speech tomorrow, no direction can be drawn from that.  Row 1 chart 4, the 3 bar consolidation pattern we see for the last three days is what's called a tornado pattern but for it to trigger, tomorrow must be its up day otherwise it has no bullish potential unless it is slowly built into an ascending triangle with 2 or 3 more trading days but it's too early to tell on that.


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