Monday, September 22, 2008

Where are we headed from here?

Last Trade Day
Well huge gap open on Friday. Interestingly enough we stopped right at the 1260 range in the morning open. As some of you remember this was a very important number in the past and remains a key turning point on this market. As we had option expiration on Friday we moved "fairly" narrow after the peak and bottom had been established.

The market has had the weekend to absorb last weeks historical events. They key remains in trying to break the 1260 range decisivly. A break here will bring us higher but considering we had strong moves in the past few days we have to ensure to break this point after we have absorbed some of the selling pressures - otherwise any attempts will continue to fail and send us lower again.

Time and Price
For today going to keep my price ranges a bit wider without all the small steps in between. Considering we have seperated ourselves with strong moves from previous support and resistance lines I would rather wait for confirmation of all the mid steps.

1st high 1260-1262 - we did hit 1264 for a split second so watch out for this peak to possibly extend itself there. 1266 should be considered for a final break of this number to stay on the safe side
1254 open/close
1st low 1236

Mid Term
I had called for 10xx in the beginning of october. Due to last weeks events I would put my mid term on hold for today and tomorrow until we can determine the direction. Keep in mind the fundamentals have not changed, banks still have the same problems, housing still continues on the down run and overall consumer and unemployment numbers do not show any increase.

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