$$ The Squeeze: GLD and GDX

I like to look at Bollinger Bands on P&F charts to identify potential squeeze opportunities.  The bands are getting pretty tight on GLD and GDX.  A big move up or down is likely in the offing.  Since I believe Stocks and Gold are generally headed to a top in May-June, I'm betting that the GDX (and GLD) move is to the upside.

$$ T Theory VO for Week of March 28 - April 1

Last week's Volume Oscillator for reference

3/21 = -1
3/22 = -15
3/23 = -11
3/24 = 15
3/25 = 25


This week's VO
3/28 = 12
3/29 = 25
3/30 = 44
3/31 = 28
4/1 = 45

This post will be updated nightly throughout the week, so check back periodically for new information.

$$ Sunday Update Posted

Terry has posted my Sunday update at TTheory.com.  This week, I discuss the Money Flow T forecasts.   

$$ T Theory VO for week of March 21-25

Last week's Volume Oscillator for reference

3/14 = -50
3/15 = -85
3/16 = -133
3/17 = -83
3/18 = -32

This week's VO

3/21 = -1
3/22 = -15
3/23 = -11
3/24 = 15
3/25 = 25

This post will be updated nightly throughout the week, so check back periodically for new information.

$$ Weekend Update Posted

Terry has published my latest article at TTheory.com.   I have discovered that the market is vibrating to an exciting new cycle based on the Golden Ratio which projects a June 13, 2011 top.  Check it out, and let me know your thoughts.

$$ Support Near

Typically during up trends, corrections find support when the percentage of S&P stocks above their 50-day moving average falls at or near the 20-25% range.  As of yesterday, the reading is 33.0%.  The symbol on Stockcharts.com is $SPXA50R.

Likewise, corrections sometimes find support when the percentage of S&P stocks over their 150-day moving average falls into the 60-65% range.  Currently, that percentage is 77.6%.  The symbol is $SPXA150R.

To me, these ranges are a good definition of "oversold in an up trend."  Both served as support in the corrections of July 2009 and February 2010.

I am looking for one more down draft in the equity market that takes us to these oversold levels.  Hopefully, that down draft also produces some bullish divergence on the Volume Oscillator and other momentum indicators.  Such a happy convergence should produce an excellent buy point.

$$ T Theory VO for Week of March 14-18

Last week's Volume Oscillator for reference

3/7 = -55
3/8 = -23
3/9 = -25
3/10 = -69
3/11 = -34


This week's VO
3/14 = -50
3/15 = -85
3/16 = -133
3/17 = -83
3/18 = -32

This post will be updated nightly throughout the week, so check back periodically for new information.

$$ New Update Posted at www.TTheory.com

Terry Laundry has posted my weekend update at www.TTheory.com.  This week I begin a series of articles examining the evidence for a top in the May-June time frame.

$$ T Theory VO for week of March 7-11

Last week's Volume Oscillator for reference

2/28 = -5
3/1 = -54
3/2 = -37
3/3 = 6
3/4 = -24


This week's VO
3/7 = -55
3/8 = -23
3/9 = -25
3/10 = -69
3/11 = -34

This post will be updated nightly throughout the week, so check back periodically for new information.

$$ The Movies

I'm not sure what this says about our economy in general and the movie business in particular, but I thought it was interesting.

From 2002 to 2010, Hollywood has seen a 15% decline in the number of movie tickets sold.   There were 5 down years for tickets, two up years, and one flat year.  

This decline in ticket sales has been offset by a 36% increase in the average ticket price of a movie ticket.  Ticket prices have increased each year at a CAGR of 3.45%.

I suppose this proves there's some price inelasticity in movie tickets.  And I think 3.45% is not a bad approximation of the rate of price inflation.  By comparison, stamp prices as a proxy for price inflation have risen at a CAGR of 2.61% over the last 10 years. Where's the deflation again?

$$ Diamond Cutting

We seem to be cutting a diamond formation on the S&P.  If so, the minimum downside target is 50 points from where price breaks down.