Wednesday, October 28, 2009

Arms Index(es) charts

daily charts of TRIN and TRINQ with Padovan moving averages 16 through 351. looks like the trend has been shifting away from accumulation and towards distribution for a bit now.

some of the higher beta segments of the market have practically been in crash mode all week (Steel down another 5% today, Chinese small caps down near 6% for the day so far, &c). large cap US stocks have held up much better than all the other pieces of garbage trading hands, and I expect that to continue, but even here the underlying structure of the market is deteriorating.

but so far I am having trouble detecting any panicky odors. perhaps participants have been so desensitized by all the little corrections the past months that in hindsight didn't amount to anything but 'buying opportunities'.

even I, one who has been waiting for this type of action as a signal that the Pump's been turned off, am trying to contemplate how the markets could shake this off and continue on with the reflation. but pro-liquidity scenarios are looking less and less tenable now.

any rallies that ensue from here can be sold after a day or two. the next few issues of the newsletter (subscribe at top of blog) will have much more detailed assessments of the markets we cover, and maybe even a few more trading ideas.

(note: stockcharts wouldn't generate a log-scale chart for TRINQ, so what you have here is a regular arithmetic chart. the Arms Indexes really should be viewed with log charts, but still I think that regular scaled chart of TRINQ paints an adequate picture here.)