As some of you know by now, I'm a big fan of the Acc/Dist of volume indicator, and looking at it on a Daily chart gives us a pretty interesting level to keep an eye out for. From a price action prospective we're at a resistance level at the 1130. This typically we would keep an eye out for either a bounce lower or a break higher, and using the Acc/Dist, I can confirm that this level is a a significant level to keep an eye out for. Couple of things to consider as to which way this will play out: 1) volatility in the markets has been pretty low and we've seen back vol on S&P options significantly higher than front vol suggesting possible rise in Volatility. 2) We see divergence on this recent rally with MACD. Both these reasons does not mean this rally can't continue and shoot higher, but reasons why I'm looking for a potential move downside vs. upside.
Thursday, August 5, 2010
S&P Daily Chart Analysis
As some of you know by now, I'm a big fan of the Acc/Dist of volume indicator, and looking at it on a Daily chart gives us a pretty interesting level to keep an eye out for. From a price action prospective we're at a resistance level at the 1130. This typically we would keep an eye out for either a bounce lower or a break higher, and using the Acc/Dist, I can confirm that this level is a a significant level to keep an eye out for. Couple of things to consider as to which way this will play out: 1) volatility in the markets has been pretty low and we've seen back vol on S&P options significantly higher than front vol suggesting possible rise in Volatility. 2) We see divergence on this recent rally with MACD. Both these reasons does not mean this rally can't continue and shoot higher, but reasons why I'm looking for a potential move downside vs. upside.
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