MARKET COMMENTARY (6-29-09)

Imperial Guard Leman Russ Battle Tank - Anvilus Imperator Design

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Consolidation continues. The new expected daily range is between 915-935 as can be seen on the 1-mo/60-min and 2-mo/60-min charts. The 8-month/daily chart shows that the SPX is currently above the 20-day MA. For a head & shoulders (H&S) pattern to qualify, the right shoulder must be a lower high and the neckline break must be confirmed. Leave your mind open to the possibility that we may not even be forming a H&S pattern. The market remains 'neutral'.





I've also added the SPRD select sector charts, and collectively as a whole, they support my neutral rating on the market. The sectors are not moving in tandem. The materials and energy sectors may be forming small bear flags. Health care, tech, and utilities are in ascending channels. Cons. discretionary, cons. staples, financials, and industrials are in neutral ranges.










On a different note, let's talk about the KASH formula:

Good formulas work just like good recipes. Follow a set of directions, and you can make an apple pie. Take out a cookbook, follow the directions, and you can make creme brulee as good as the person who wrote the book. What's the point? The kind of formula you follow determines the outcome you'll have.

Formulas apply to all aspects of life. Take for example, a tailor followed a pattern to make that suit or dress that you are wearing. A builder built your house from a set of plans. A programmer used a set of formulas to design the programs that you use. For all of those formulas to work and give good results, they had to be followed carefully.

There's an old joke about a pharmacist who was grinding a prescription that called for as much strychnine as you could put on the face of a dime. He didn't have a dime, so he used 2 nickels.

Sound like something you would do? Bet you'd hate to be the one taking that prescription. Unfortunately, that's about how carefully some people follow the formulas they've learned in life, and in trading.

What is KASH? KASH = Knowledge + Attitudes + Skills + Habits = Success.

Here's a useful exercise for you to evaluate yourself:

1) What additional knowledge do I need?
2) How can I improve my mental attitudes?
3) What additional skills do I need?
4) What new habits should I develop? (For me, I need to get to bed earlier!)
5) How can I improve my success personality?