Stocks seem to have started their way back up - I think the Dow Jones just went positive for 2010. The sell off of January seems to have worn off in February and we are getting close to making new highs.
It looks like the long term chart is showing some price support. I have used the Volume-by-Price indicator before and I see something interesting. Any new high will likely see a lack of resistance up to the 1200 level or so.
During the rally, different Vol/Price levels filled up with black - that is "up" volume. These levels had not seen much up volume since we plunged thru them on down volume back in September and October of 2008. See the price levels from 900-1050. That could be a continuing trend.
The channel lines that I drew based on the most recent high and low are not perfectly aligned with the Volume/Price level. But I think it is still give us an indication that there might not be much selling pressure until we get thru the next band - which would be about 1200 on the S&P 500.
Vol/Price data aside, we are quickly approaching the level of the market before the major sell off from Fall 2008. I think this could be a resistance level for the overall market. Dan Fitzpatrick likes to call this the "I want my money back" trade. Well if you remember that sell off, more people than ever were in tuned with the sell off, and therefore were more aware of their own investments. Those who lost money might be inclined to distrust this market and might move their money out if they are close to making their "money back".
This is pure speculation on my part, and I am often wrong.
However, there is a little ways to go before we get to the "money back" point.
Posts
0 comments:
Post a Comment