SPY Potato Charts

SPY 1 Day. 5 m. - "JA"  has observed that there are frequent potential plays using the 1 Day, 5 m. 10-30 Crossovers (Mini Potatoes).  There were two such plays today where 4 Calls and then 4 Puts could easily have netted $200 profit each.  They are marked with an Orange Spot.  Use the MACD crossover as the buy signal.  "JA" is committed to this strategy for 6 weeks.  It will not work all the time, however, backtesting indicates that it has 4 out of 5 times.
The New Bull Potato that formed in a very weak manner on Friday continued to develop today although with volatile moves and inconsistent advancement.  The price ended up in the Devil's Den (between the 10 & 30) leaving questions as to its strength and longevity.  Our experience has been that Potatoes last from 3-5 days on average and sometimes longer.  This one leaves us suspicious as to its punch.
The same weakness is seen on this chart as well.
20D, 60m - Bullish move with definite crossover but shallow vector.  Internals were strong this AM but faded into weakness in the afternoon.  This move is in conflict with what is seen on the Daily chart that follows.
3M, Daily - Bear Potato formation with vector headed down in a decided manner.  This chart sets the tone as to longer term expectations and positions should be taken with that in mind.

For these reasons I have not yet posted a Bull on the Blog.

Sweet Potato Lore

So, what is a Potato?  Our potato is a sweet potato, and these come in all shapes and sizes but are generally fusiform in shape.  The potato we are talking about is the space created between the 10 Day Moving Average as it crosses the 30 Day Moving Average either to the upside or downside thereby generating a Bull Potato or Bear Potato.  Potatoes can be seen in all time frames and are useful in determining trends in the market and especially reversal in direction. They won't show exactly where the market is going, but when you follow tracks in the snow you get the general idea of the direction in which they are headed.  Using the MACD in conjunction with the Moving Averages may help in making trading decisions.  Of course there are many other indicators that can help as well.  The week ahead will be exciting and you never know what will happen.  Isn't this fun!

The Alpha Trends Blog has been added to the Blog List to the right as it is very informative and well done.  Check it out!

SPY 3M, Daily - This longer term chart shows a Bear Potato (Gold Spot) with a declining Trend Line and Red MACD.  These are all Bearish indicators that conflict with some of the subsequent observations.
10D, 60m. - A very weak Bull Potato has been technically confirmed on this 60m. chart.  It is so weak that it is hard to trust.  There is little direction shown other than sideways.  I think we need further confirmation on Monday to believe it is valid.
5D, 30m - Very orderly trend line to the upside.  Session started with a gap down and very weak internals which improved during the day.
2D, 15m. - Gold Spots show reversal points with equal bottom and tops on candles.
2D, 5m. - "JA" Play of the day would have resulted in a 1 1/2 point gain for a nice profit.

Usually the move from Bear to Bull or Bull to Bear Potato is more well defined in the crossover.  I am not fully comfortable calling the Bear dead as yet, although the MA did crossover (barely).  No pun intended.

Cold Weather Bear 
SPY 3M. Daily Addendum - This chart has been added since it shows a "New Bear Potato" forming in the Daily Chart (right side of chart).   A trend line has been drawn along the candles which demonstrates the current direction of the market.  A mostly sideway neutral potato is seen over the last six weeks which has now converted into a Bear Potato.  This may be significant and suggests more movement to the downside.  The longer term time frame potato needs to be kept in focus as we deal with the market day to day.  Yesterday (Thursday) was very volatile and the internals were very weak.  The market has been real tricky lately and there a lot of mine fields and booby traps out there.

The Bear Rages On!

SPY 3M, Daily -  The above chart continues to show the sideway pattern that has existed for the past 6 weeks.  The last 10 sessions have resulted in almost a continuous downward move.  
SPY 10D, 60m. - The anticipated new Bull Potato was not confirmed on the 60m. chart.  "Jumping the Gun" and taking a position anticipating the move can be hazardous and should be avoided.  After today's session we are again presented with a possible new Bull Potato.  Again we must wait on confirmation or risk losing as the Bear resumes his downhill run.  Areas of interest are in Gold.
SPY 10D, 30m. - Shows a lot of bullish activity as the MA's are crossed to the upside.  This is promising but must be confirmed before taking a bullish position.
SPY2D, 5m. -  The JA Plays of the day are depicted on this chart.  "JA" has observed that there are intraday opportunities by playing the "mini-potatoes".  There were two good profit opportunities today as pointed out on the chart.  These charts can be enlarged by clicking on the chart.

The above chart shows the intermediate sideways movement of the market.  I try to show market movements in different time frames.  This is important in giving us perspective in the broad market ups and downs.  Sooner or later the price will break out of this "straddle".  In the mean time we need to deal with the ups and downs of the daily and multi-day swings.
This chart shows the "Battleground" that happened a couple of days ago.  I think we need to avoid "Battlegrounds" as it is there you can take a bullet.  Position yourself on a hill and watch the battle and then go with the flow.  Gold spots show the areas of interest.
More on Battleground and possible breakout.  This is on a 30m chart and needs confirmation on the 60m chart and then it is "full speed ahead".
This chart shows the dramatic and very strong movement this afternoon in the market.  The 30m chart was very positive for a new Bull Potato.   We are just short of getting confirmation on the 60m chart.  It may happen in the AM.
Very stong thrust to the upside.  Perfect entry on the "JA Play".

SPY 20D, 60m - Jan. 20, 2009

This is the most important chart in that it shows the extended bear potato that we have had for the last 9 days.  There was a full scale bull/bear battle for two days that has resolved to the downside at least for the moment.  Tuesday's session was significant in that the internals were very weak all day and became even weaker as the day progressed.  All time frames showed Red MACD.  This potato is very over extended in lasting for this long.  Sooner or later we must get a break to the upside.  There is no way to know when that will happen.

SPY Charts 1.20.09

3M, Daily - Breakout to the downside from a sideway pattern.  Very weak internals.  At this point appears headed toward testing the lows.

20D, 60m.- Bull Potato failed to pass the test.  We now have a continued Bear Potato going into the ninth day. Red MACD.  Weak internals all day today.

5D, 15m- Battleground broke out to the downside.  Red MACD.  Headed lower?

2D, 15m - Is there a bottom?

"JA" has observed that there might be short term trading opportunities by using the 10-30 MA crossover combined with the coincident crossover of the fast line over the zero line in the MACD. 

Today was a perfect example of how that will work.  An entry near 84 could have produced a handsome profit.

SPY 20D, 60m. - 1.16.09 Potato Swings

This 20 D, 60 m. SPY Chart demonstrates the wave like swings of the MA Crossovers creating images similar to sweet potatoes (therefore the name Potato Trader).  Each swing lasted 3, 4, & 5 days with total point changes in the "safe zone" totaling 16.00.  Apply that to a delta of your choosing and you have a nice profit. The system requires patience in waiting for the proper entry and exit points.  "JA" has observed similar findings on the 1D, 5m chart for intraday trades.