Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Monday, December 10, 2012

Broad Market Continues to Improve

Stock Market Technical Analysis Blog

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In the stock market today we saw another day of slight improvement in the technicals that were shown in last night's blog.  Tonight I would like to focus on the Nasdaq, VIX, and AAPL.  

  • Nasdaq Chart 1:  We see that we are starting to shift to a slightly uphill channel over the past few days.
  • VIX Chart 2:  We see the continual decline of the VIX as it is getting closer to the lower stock market friendly channel.
  • VIX Chart 3:  I've applied two fairly large key EMAs showing that a red / green pushdown situation has developed which is bullish for stocks.
  • AAPL Chart 4:  Back on the 16th we saw a huge purge as AAPL's red 5 EMA caught and bounced from its gold 324 EMA line.  They are obviously trying to work the same setup again for a 324 double bottom.  On Nov 16th we kicked off a huge multiday move from this setup but to have the play happen again we have to get a hammer candle on both the day - chart 5 and the week - chart 6.  Today's candle on the day and week are both spinning tops.  In order to produce a bull reversal hammer on both the week and the day they have to let the price bar drop well below the 324 line right as the 5 comes into contact with it then in the afternoon of the same day bring it all the way up to slightly above its opening price so that they produce a day and week reversal hammer candles without letting the 5 slip below the 324 EMA.   The first time back on the 16th it was free money on a stick, this time though AAPL has the pressure of a 50 / 108 pushdown and also the weekly sentiment EMAs in a pushdown as I showed on the 12/5 blog.   If they can pull this off a second time with AAPL under new pressure they will have the winds at their back for a Santa rally.  The bears are going to be on their toes this second time, they really don't want to see AAPL successfully complete a 5/324 double bottom setup.  The bulls could try to make it happen tomorrow or it could be the next day.  It is important for AAPL's chart that this happens, if they can't pull it off AAPL could suffer a day 5/324 downcross which will be a huge Xmas present for the bears.


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