Price Time Volume Investing

Discussion of market internals.

Charts and analysis for premium subscribers has been updated.

I will be taking a two week vacation from my day job (software engineer).

Interesting that the Banking Index (BKX) low today was the low of the week. The BKX price did not plunge with the rest of the market.

The market doesn’t look so bad. Tomorrow morning I’ll show the NDX moved to the 50/50 point of the 2006-2007 range. The Russell re-balancing always causes weird action this time of year.

It would be tough to find a weaker chart than the BKX. It is hard to imagine the market going up with the banks at least stabilizing.

I don’t know what it is but the market just isn’t acting right . There was the Fed today, and funds going out of business into the end of the month, and Russell re-balancing. My breadth stats were terrible again today. It looks to me like another distribution day.

Wave cycles discussed for the SPX.

The SPX is currently at the 1:1 ascending Gann angle of the range of the second 5 wave formation off the 2002 low.

A Gann Fan is nothing more than a slope of a significant range and multiples of that slope. For those of you who have been following my Range Square analysis, you will notice that this is not any different.

The QQQQ remains above the 50% price retrace level and volume is falling off in the last few days. This is not super bullish, (not above the 1:1 descending angle), but it is much stronger than the market “feels” based on media commentary.

The SPX Equal Weighted Index continues to following the 2:1 descending angle. It is now at the 1:2 ascending angle. This is a place for a move up. The market feels like it is waiting on a time cycle to complete.

This is the second in a series of posts meant to provide a guide to those who have been emailing about my method. Once a range is found that appears to be significant, then vertical lines called time Gann Angles are placed using the starting and ending point as 100% of “time”. Adding time cycles will make it easier to validate (or invalidate) the range you selected.

Stock Market Analysis

In general, the concept is to find the best fundamental stocks that have the highest relative strength and momentum. The list has worked well for me for me over the years. There are several fundamental calculations I use, but the main effort is to find the best Year over Year growth stocks with a ROE over 15.

First day of summer. Big distribution day. Gann said the equinox could be a turning point. But which way? Trend is down so a turn is up?

Yesterday, the Powershares QQQ Trust (QQQQ) tested the recent low and made a high volume run at the 1:1 Gann Angle. The second attempt is usually easier than the first try at breaking a significant angle.