TCM Notes : 9/29/09

• Morning star reversal patterns were seen in many equities after a 3 day selling bout. The context of this pattern could be scrutinized as it didn't come in a long down trend. However, a 3 day oversold condition could be enough to satisfy this pattern. Confirmation would be a gap higher at the open. Financials reclaimed their 9dma reasserting their leadership within the indices. All sectors participated in the rally giving credence to the breadth of this market. I'm looking for the energy sector to assert itself here on this next push towards new highs.
• Which leads me to the UCO position. I had ratcheted up the trailing stop intraday only to cancel it when oil waffled midday. I want to give it a little room to breath, but am leery of the muted action. One would've thought oil would have at least been up 5% on the day off the saber rattling. Keeping a close eye on this one. SCO is structured technically to move higher as it has cleared most of it's moving average resistance. Whereas UCO is still beneath them all. Catching market turns is never easy and can sometimes be a costly endeavor. Our stop will be the low from Monday now. 9.96 up from 9.81. 7% stop rule calls for a stop at 9.36.
• UYG had the morning star reversal I spoke of. Strong finish on the day. Expecting some follow through as it has reclaimed the 9dma again after a test/violation of the 20dma. All the things outlined in my UYG narrative still apply. http://tcmllc.blogspot.com/2009/09/uyg-pattern.html