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12/26/2011 9:58:42 PM Keystone Speculator Posts: 32	The blue negative divergence resulted in a smack down as was forecasted in october; price dropped to the lower rail of the upward-sloping channel. Price then popped back up off the lower rail over the last month to punch out a higher high and touch the top rail of the channel again. This results in another rising wedge and negative divergence (red). This is a significant top forming. The momo was strong last week so that type of move will need to move across in a stutter step, M top type movement, and then roll over as the weeks and months tick by. For this near term red wedge, however, the spank down is needed now. Note the buying volume for last weeks huge move was the least since late summer making the move unenthusiastic. For this last trading week of the year, the 440 level is critical. Market bulls will enjoy broad index buoyancy as long as price stays above 440. If 440 is lost, the broad markets will sell off. The 50-week MA represents where the broad markets would go into free fall, 428-430, but at 463 now, the utes are comfortably above the two danger levels (neon green lines) and this worry is not currently on the table. Things can change quickly, however. Projection is for a pull back now due to the red negative divergence, then a continued topping action thru 440-470 with sideways to sideways lower prices moving forward. Would not be surprising to see this 465 area as the long-term high.
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12/26/2011 10:00:02 PM Keystone Speculator Posts: 32	SDP Weekly Chart: SDP is a thinly-traded inverse ETF for the utilities so it moves up if the utes move down. Note the collapse shown by last weeks' red candle as the utilitites moved higher. The green wedge and positive divergence was highlighted as November began and the rocket launch followed as expected. Price has now returned lower forming the purple falling wedge and postive divergence so it is time for another launch. The MACD histogram has now joined the postive divergence party as well. Lots of buyers entered in November as the utes received their negative divergence spank down as shown by the large volume candle. Thus, there are many holders of SDP now in the 34-38 zone. After the pop, some traders stuck around too long, forgetting to take their money at the window and gittin' out of Dodge while the gittin' was good. So when price comes back up, those traders, may be inclined to exit their positions between 34-36 so that serves as a handy initial target, then, after that, SDP would come back down again to continue to base, then another move up. Projection is for SDP to move sideways to sdieways up for the weeks and months to come as the utilities (UTIL, XLU) move sideways to sideways down.
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