Spooz Soup

August 3, 2001
Marc Dupee

The following confluence of signals screamed there was
the potential for a selloff in the
S&P
(
SPU1 |
Quote |
Chart |
News |
PowerRating) and stock index futures this morning.
Perhaps most noticeable was the Turtle Soup Plus One
Sell signal left yesterday when this market jumped to a 20-day high
yesterday, only to sell off. Similar to yesterday, the spooz sold off from their
opening tick, cascading 10 handles and have retraced (nearly) 50% off intraday
double bottoms.Â

Another set of indicators also screamed the potential for
a selloff. Today we had five signals from the
Market
Bias Indicators Page pointing down. More than one is often an indication of
direction, three is considered a critical mass to give a larger-than-normal
edge. Five indicators pointing the same direction presents again an even larger
edge. Yesterday we had four down signals as well. Over the past two days, seven
of the nine signals on this page have flashed red, implying a selloff.Â

As mentioned in yesterday’s Futures Market Recap,
euro FX futures
(
ECU1 |
Quote |
Chart |
News |
PowerRating) and

Swiss francs
(
SFU1 |
Quote |
Chart |
News |
PowerRating) had the potential to sell off from Turtle Soup
setups but the strength of recent momentum implied they could very likely move
to new high ground following any blip down. The euro FX held at the lows of the
past two days after an opening cascade and have made nice gains off lows to new
multi-month high territory in an outside day-on-high pattern, very constructive.
These two contracts now lead the Momentum-5
List.

In the energies, the easing of tropical storm Barry in
the Gulf of Mexico is sending natural gas
(
NGU1 |
Quote |
Chart |
News |
PowerRating)
down a sharp 6%. The recent lows at 2.960 are holding and proving support.Â

Spooz Soup

BUY THE FEAR, SELL THE GREED

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