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Yesterday, the Bears managed to close the NASDAQ back below BOTH the top of the downward sloping channel (blue) and the upward sloping channel (red), but not convincingly. Given the Quadruple Reversal that we examined yesterday, I'm a tad suspicious that we might get a fifth, particularly given the fact that the 89 RSI (Chart #2) has broken out of an Ascending Triangle, LEADING PRICE, and on yesterday's selloff, came back to retest the breakout. The 55/89RSI's also are at Bullish Synchronicity. The NASDAQ needs to take out yesterday's high of 1563.79 to generate a Buy Signal from this particular indicator, so we'll see.
The Bears have the advantage here after the break of TWO trendlines. A downside takeout of the December 12 low of 1478 would look more convincing. That would put in a short-term Double Top (highs: 1602 and 1598).
The Bulls need to get back above the broken trendlines (data points for today are at the upper right on the chart), then more importantly, knock out 1603.
2 comments:
I would be interested in your comments on why you use the 55/89 RSI
Good Morning, Mark,
The sequential Fibonacci measures of relative strength are a "homemade" indicator of mine that I enjoy playing with. Often, when the RSIs thrust higher, then come back into synchronicity (readings that are very close) with the next number down in the sequence, then continue higher out of the synchronicity, it's a good signal.
The reverse for Bearish Synchronicity, like September 19 on this chart. That Sell signal resulted in a huge selloff.
I'm looking at the 55/89 RSI's here because the faster fibonacci RSIs in the sequence, 8,13,21 and 34, already gave Buy Signals in early December.
This study is still a work in progress, though. If I ever get it figured out to my satisfaction, I'll probably croak off the next day ;)
Merry Christmas to you, Mark! I'll be by your house with Santa a little after midnight tonight, so make sure that you're nestled in your trundle, and fast asleep.
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