Forum Clusters 110627.xlsx
The market is now very near of issuing a confirmation of the initial leading 20 DMF buy signal within the next few days. This usually coincides with an IBD Follow-through day. In CANSLIM, a FTD is a necessary requirement before a rally may start, but it tells you nothing about the potential success or failure of the rally.
On the other hand, the LT/ST edge combination for the IWM robot is now much weaker than on the initial buy signal on 6/10/2011. New long entries have lower reward-risk profiles but are still to be preferred over short entries.
The IWM multi-pivot outlook is neutral for Monday, with a total resistance/support clusters ratio of 21/22.
The first resistance cluster is very heavy with a weight of 16, but it only starts exactly 1 ATR above Friday’s close at daily R2 (81.35) and new WR1 (81.39). IWM could experience an easy strong day up to + 1.76% before testing the first cluster resistance. The rest of the week will likely be less easy for fast progress. In case of weakness instead, QS1 (79.32) remains the level that should hold as successful support on a day closing basis before the outlook can turn more bearish. QS1 is in confluence with daily S1 (79.35) which should ideally mark the low for the day if large players stay in accumulation mode while the SP-500 is testing its 200-day moving average.
The GDX robot remains too in a very weak buy signal from the LT/ST edges statistics. The multi-pivot outlook for Monday is rather bearish as there is no significant potential support before WS1 (51.22).
The stop (50.70) for the initial long position entered at 53.26 is just above Semester S1 (56.64), the only strong support left below WS1. Billy
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