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"Here's what ECRI's recession call really says: if you think this is a bad economy, you haven’t seen anything yet. And that has profound implications for both Main Street and Wall Street."ocassional observer wrote:i guess next week is critical. spy doing a back test in the 1260's with 200 day&50 week resistance and overbought conditions seems to merit a short position. economic indicators coming out of europe this month (PMI, IFO) confirm entry to recession. since economic activity in germany has not followed yet, most pain is yet to be felt. according to the oecd leading indicators for august (yes, the leading indicators are 2 month old but presumably lead by 6 month) the US is on the verge of recession. i guess recession starts oct-nov. hussman's indicator has started flashing red by the end of july and usually has about 13 weeks lead. the ECRI joined chorus 2 weeks ago, so i believe this call is valid. short term indicators such as fed manafcturers do not materially change that picture. for longer term traders i believe next week or two will provide the best short entry points in this cycle before a waterfall in prices as recession sets in. China will not save the day.
last but not least, the credit suisse fear barometer:
Now let’s use the same tools for recent events. We are still under the “spell” of a buy signal, delivered and confirmed at the base of the curved channel (10/5). However, the wave is getting kind of tired as the “Trend Quality” and the “Momentum” are idle and coiling.cougar wrote:In my limited experience, curved channels are frequent in indices. In contrast, they are rare in "interesting" stocks", where “good-to-follow moves” are mainly contained in Linear Regression Channels.
We should first zoom on the SPX curved channel of 3/17 to 4/11/2011, where BUY and SELL signals are generated by some “ad hoc” selected and adjusted indicators: