Sunday, April 28, 2013


Moving to Weekly Updates only

Well, ladies and gents, I've given a lot of thought to this blog the last few days and the time-cost of it.  After about 10 months of daily updates (give or take a day or two here and there,) I've decided that I want to reallocate my time each night to other things.  Accordingly I will only update this blog on the weekends when I have more time available.  Thanks to the regular readers out there across the planet, and I hope you continue to find this information useful in your market analysis.  I'll post updates if things are news worthy.  I'll also update my thoughts on Twitter, so feel free to follow me @RumWave. 

Here's were we stand:
- Weekly charts are giving way to some weakness.  Witness the red candle at the top of the DIA weekly chart:

Here are the daily scores.  They suggest that on a short term level, there is some room to move higher still:

Overall, I'm very cautious of the market's intentions.  I think we may end up seeing some volitility as the market find its top here.  This should benefit traders that use shorter scale charts (4hrs and less).

My position is that of "Hold" and/or secure profits.

GOOD LUCK NEXT WEEK, I'll see you next weekend!

Wednesday, April 24, 2013

Booked profits

Booked UDOW profits today

Although a "red light" signal isn't anywhere close, my gut told me to take my winnings to the cash register today.  The market showed a lot of difficulty climbing today, and it was at the RumWave resistance level I described yesterday.



Tuesday, April 23, 2013

Good day for RumWave trades

Today was a good day

RumWave inspired trades profited today.  I'm seeing a bit of resistance on the RumWave chart, so we'll see if the indexes can power through.


Monday, April 22, 2013

No changes

No changes

I'm still cautiously optimistic here.  I'd feel a lot better if the weekly charts weren't so high, but for now I'm letting my positions ride.  It feels like the move up will be a difficult one.


Score Total since June '12:

Sunday, April 21, 2013

Cautious Green Light

Cautiously turning on Green Light

Short term signs point up.  My RumWave chart is showing a bottoming pattern.  Extreme caution is advised here because the weekly charts favor medium term downtrends.  Remember, my expected trading period is 10-15 days.   This one may be shorter than that.


"Score Total" since June ' 12:

DJIA 4 hr chart:  MACD looks to be turning a corner.

DJIA Daily Chart:  Bullish Hammer candle on Friday.

Overall, I expect the general market trend to be up for the short term.


Thursday, April 18, 2013

Wrong about the bounce

I was wrong about the bounce

I really thought we would gap higher this morning based on the bullish divergences I was seeing on yesterday's charts.  However, the market proved me incorrect.  The bullish divergences are still very easily seen on 1 hr charts of the DJIA, S&P, and RUT.  The QQQ does not show a bullish divergence.

The RumWave system is very close to the "green light."  I just need a little more downside movement and the trigger will probably be met.  Despite not quite having the complete green light signal, I did begin scaling into bullish UDOW positions.

We haven't had a green light yet this year.  When it does happen, remember that the time horizon could be fairly short, especially given the current levels of the indexes.

Daily Scores:


Wednesday, April 17, 2013

Big 'ol Bounce tomorrow

Good opportunity to catch a pop

I wish I could have been looking at my charts going into the close today.  There is lots of evidence that the market will gap higher at the open tomorrow.  We'll see if it holds.


 The big note is that the RumWave score is really low.  I don't expect it to stay there.


Tuesday, April 16, 2013

Pivotal day tomorrow

A Fork In The Road

Which path will the markets take?  I think another leg to the downside would make sense as a "C" wave.  It will be interesting to see.  My charts don't really favor one way or another.


"Score Total" June '12 to today:

Good luck tomorrow!

Monday, April 15, 2013

Bad start to the week for bulls

Equities / Commodities sell off

It was a rough start for bulls this week.  A large correction has been needed for a while.  Of note, the 20 day moving average of the Russell 2000 took a downward slope for the first time this year.  I expect a bounce tomorrow.


Sunday, April 14, 2013

Took light profits

Booked my profits for the week

Although I never turned on the "green light" I had a small UDOW position running last week that turned out to be a winner.  I took my profits Friday because I'm still a little uneasy about things on the weekly charts.

Here are my daily calculated scores:
What I'm happy about is that the score system has proven to be a helpful decision aid when I was unsure about things.  Generally, if the "Score Total" (the bottom row) is in the green, it has been a good time to consider long positions.  When it turns red, it is a good time to book profits.  It's mechanics consider the entire market, not just one particular index, so it does a nice job anticipating some moves that would be missed by traditional analysis.

Weekly Charts:

   The DJIA chart above is still looking strong according to the Heikin Ashi candles.  However, the oscillators on the lower graphs still show a market that is overbought and due for consolidation and/or correction.

The SPY chart is very similar to the DJIA.  What I'd like to point out is that the Slow Stochastic blue line is continuing to roll over.  On previous waves this predicated sizable corrections. 

 The NASDAQ chart above is showing the same signs on the Slow Stochastic as the other indexes.

 Finally, the Russell 2000 small cap index above is showing some signs of fatigue.  We actually see TWO red "doji" style candles for the first time in many weeks.  It doesn't mean  that we are definitely going off the cliff right this second, but it is worth taking note of.

All that said, I don't have a good solid feel about where the market will move next week.  The three other blogs I read all spoke of an upcoming May correction, and I feel that they are probably correct in their timing.

I read of an upcoming IMF (international monetary fund) meeting this week.. those are always interesting as European officials tend to throw out some kind of off-the-cuff remark about dangers in the Euro zone that send the market screaming in one direction or the other.  I also heard a report on CNBC that succinctly outlined exactly how Cyprus' bailout will not be enough money and they will need more.  This could be an interesting week.


Thursday, April 11, 2013

Honeybadger is back

Good run

It is amazing how this market just won't quit.  I guess it is, after all, the most attractive investment vehicle in the world, and the Fed is committed to making equities and housing wealth mechanisms for the forseeable future.  I'm considering adjusting my "green light" signal a bit in light of recent events.  I've just barely missed turning it on 3 times this year.. all of which would have been profitable.  I'm going to think about it for a while.


Score total June '12 to today:

"Daily Score" June '12 to today.  


Tuesday, April 9, 2013

Snap Back Likely

Pullback tomorrow?

There has been a nice little run for the major averages for the last few days.  I've been able to make a little profit here, but I didn't go all (or turn on the green light) in because I'm just feeling like another pullback is needed.  I suspect a 100ish point decline would be in order.



Monday, April 8, 2013

Resumption of downtrend?

Cautiously becoming more bullish, but not ready to commit yet

The RumWave chart is moving closer to a buy signal, but it has not met the criteria yet.  Coupled with the parabolic moves upward on the weekly charts, I think we still have one more shake out lower before I'm ready to commit.

Today's scores:

"Score Total" June '12 to today:


Sunday, April 7, 2013

One more bounce?

Small caps look ripe for a bounce

The RumWave chart is showing signs that a small-cap bounce is likely.  I think there will be some notably large swings in the market for the month of April as we quickly approach the dreaded month of May and summer volatility.


"Score Total" June '12 to today:

All my scores, June '12 to today:


Thursday, April 4, 2013


Just a quick post tonight.. No real change in my opinions. A "C" wave to the downside would make sense here.


Wednesday, April 3, 2013

There's something different here

One day, a trend does not make...but

The old adage that "one day, a trend does not make" rang loudly in my head as I drove home today listening to "Fast Money" on CNBC.  However, there was something different in the tones of the commentators' voices today, they were nervous.  Usually they have at least a few bullish folks saying "I'm buying the dips here" or something along those lines.  Today's broadcast was all doom and gloom, talking about how the internals of the market were failing.  It all seemed kind of group-thinkish to me, but if these people are my only window to the big money I'm wondering if the big money is having the same thoughts that my Fast Money friends were.

The other bloggers I read on a nightly basis are also in agreement that things are about to get nasty.  Not end-of-days nasty, but a 5-7% pull back.  I'll buy it, I've been calling for it since the first of they year, why would I stop now?

Here are my scores:

The RumWave score is really low, so I'm expecting some kind of bounce tomorrow.  If we don't get it I'll be a little more concerned about our good friend, the Honeybadger.


Tuesday, April 2, 2013

Nice rally

Good work, bulls

Today we saw a pretty strong market.  I have no reason to believe that tomorrow couldn't be more of the same.  Honeybadger.

The biggest cautionary tale is that of the small caps.  RUT was down 0.48% today continuing the divergent pattern from the mega-caps.  The phrase "sell into strength" comes to mind.