The Charts Are Set Up

There are lots of charts that have the same pattern. Most are orderly pullbacks into moving averages and now the downtrends are being tested. The markets are setting up for yet another fast move. Will this one be up or down?

Mid Cap 400 (MDY)
MDY got overbought on September 17th (Red Arrow) and has been consolidating ever since. It has gone from being stretched 3 Standard Deviations above the 20-day to closing today right below the 20-day (Black Arrow). Guess where my stop buy order is?

Here is the daily chart for MDY. It pulled back to the 50-day and is now set to make a big decision. If buyers show up, then I am in. If they don’t, then I will look to buy MDY at lower levels.

Austria is the gateway to Eastern Europe and the Austrian ETF (EWO) serves as a proxy for much of Eastern Europe.

Singapore is still sitting in its trading range.

Commercial Real Estate has also pulled back into its 50-day. That’s a pretty orderly pullback, don’t you think?

Apple broke out of its trading range today. Nice goal line save, UBS Analyst. I hope you get a nice bonus from our TARP Money. Or maybe it’s bonuses from our Tax Cheats…

China National Offshore Oil (CEO) closes Friday being below the 50-day and then gaps up two straight days (a $9 rally in 7 hours) to now be testing resistance. I’d love to see a breakout above this 3-month trading range. At some point, the mystery bids and Futures-driven rallies will cease or fail and the markets will get hammered. Until then, I play the breakouts.

Several High Growth Leaders are set up. Several others have already broken out. All in all, I think that things are pretty constructive. For disclosure purposes, I can have orders in to buy all or none of these. And I can change my opinion without letting you know.