Tuesday Morning Analsyis, March 17

As of 9:53 AM ET, the 10-day moving average for the CPC and CPCE spiked up, meaning a trend change is imminent. Amazing it hit 0.825 before going back up again, as it did the last three times. The 5-day moving average for both indicators spiked up yesterday.

I generally never make any trades before 10:30 AM Eastern Time and often wait until 11:15. I like to see how morning trading and daily trend channels develop before entering the market.

UPDATE: 10:30 AM ET

The slope on the CPC just went south down again; i.e., continued going down and is now at 0.818; though the CPCE is still in a spike up position. This warrants caution regarding a trend reversal. Using SPY, the horizontal support line is at 75.50 with resistance at 76.35.

UPDATE: 1:15 PM ET

Some pretty powerful moves by the bulls this late morning. So far its a low volume day with the bulls pretty much in complete control. The bears will look to make a stand around 2:00 ET, but it might be game over for the day by then. Though I am a shorting trader, when the market is looking this strong, I stay out of its way. So far, it is one of those days the bulls won't be denied. Daily and 15-min stochastics are topping, but the 30-min suggests we won't have a meaningful decline until the end of the day, if any.

An analyst from one of my subscription services says the market should retrace last week's market lows by options expiry on Friday, March 20... that's three days away. Personally, I can't see that. The market would almost have to go straight down from here for the next three days to make that happen.

With so few traders/investors in the market, the market's ups and downs are controlled by the hedge funds. The problem is, the market is too bullish for the hedge funds to take it much higher. If the market doesn't start to get bearish soon, the hedge funds will truncate any rally. Look at 7,449 on the DOW for resistance.

Therein lies the belief the market needs to go down from here to dispel the general bullish trader/investor sentiment. This is why I follow the CPC and he CPCE, which gauges investor sentiments and more accurately marks turn-arounds given current market conditions.