Feb. 24, 2005: Crane

After close analysis:

So much to cover today. First, in hindsight, there was divergence between AB, NQ and ES/Dow while Vold was climbing all day yesterday. It could've gone either way but I guess the answer is clear now. Today, the patterns were clear and the market was showing strength (buying pressure) in the morning as there were plenty of triangles. This was one of the easier days to trade and certainly much better than yesterday. Today's pattern is a "CRANE" where by after consolidation it goes up in a parabolic way! Nice 6bo setup and I took it earlier on a 2bo. There was a continuation trade later on but didn't take it (why???). Wow, I got dizzy making predictions for following day, but based on how breadth behaved today it looks like this reversal might have legs.

Thought(s) of the day: I have this aweful feeling - need to spend some time alone.

Market breadth held in the morning and rallied in the afternoon. Vold didn't do much until it broke out of its 7-bar range. Addq had an interesting story by forming a triangle in the morning and holding apex till it bo'ed in the afternoon. Same with Add.

Futures were mixed in morning: AB dipped lower while ES and NQ held their serve. Buildup was clear on AB (triangle) and it was a matter of time before it bo'ed. Emas were clear resistance and key level for bo was 622-23 levels from yesterday. NQ was encouraging and confirmed breakout in the market. This is an encouraging sign. ES200R chart is bullish and had a "sloping base" pattern.

Indices did very well on reversal. Interesting observation is Dow where it held apex for last 2 days and reversed of that. Apex was around 10650 area and that's key. If it holds this level then we'll see plenty of upside. SMH & SOX reversed and are above their emas. Now what??

Overall positive day!