From 1990 to 1997, Kevin Haggerty served as Senior Vice President for Equity Trading at Fidelity Capital Markets, Boston, a division of Fidelity Investments. He was responsible for all U.S. institutional Listed, OTC and Option trading in addition to all major Exchange Floor Executions. For a free trial to Kevin’s Daily Trading Report, please click here.
Commentary for 7/2/12
There was a major short squeeze in the Euro and “risk off” macro positions on Friday as the USD declined -1.4%, and XEU rose +1.7%, while crude oil [USO] spiked +7.9%, in addition to significant gains in the other commodity ETFs.
The DAX and CAC40 were up over +3.0% overnight coming into Friday and the SPX +26 points, which resulted in a significant gap up opening, with the SPX hitting 1355.90 high on the 10:20AM bar [+26.75 points] versus the +2.0 VB at 1353.67 The trading day was over after the opening period as the SPX flat lined all day until a +6.0 point mark up in the MOC session from 1356.13 to a 1362.16 close [+2.5%].
The catalyst for the short squeeze was the Brussels headline news/rumor/band aid, but the big winner was the Generals, as Friday was the end of the 6 month report card period, and the SPX +2.5% gain meant the SPX was +8.3% YTD for the 6 month period.
The SPX made a +7.6% reversal in 11 TD`s from the key price and Pi time zone 1266.74 low at the 377DEMA, to the 6/19/12 1363.94 high and S/T-O/B condition. It corrected to 1309.27 in 4 days with the .50RT from 1363.94 to 1266.74 at 1315.10 and .618RT at 1303.69.
The SPX reversed the Fib zone to 1334.40, and closed last Thursday at 1329.04, followed by the Brussels spike of +2.5% on Friday. There is no risk reward for buying the SPX spike here if you missed the key price and time zone reversal, followed by the pullback to the Fib RT zone and S/T-O/S condition. The SPX 3 month +2.0 STDV band is now 1380, with the +3.0 at 1410-1415 and the channel leg AB=CD at 1407. Selling the strength, not buying it, is the next opportunity, but only when the symmetry and technical evidence are in sync.
Obamacare speaks for its own detrimental self, and you had better put your market helmets on if he gets elected again and holds the Senate, because the market ride down will be sharp and nasty.
You can download for free 6 of my calculators that I use to measure price and time symmetry at www.geometricmarkets.com, and my new 200+ page manual “Markets Trade With Geometric Symmetry” is also available for purchase on the site. It doesn’t matter whether you are a trader, investor, portfolio manager, or analyst, because this Manual will enable to pinpoint high probability reversal zones in any market, including Stocks, Bonds, Commodities, and Currencies.
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