Monday, March 16, 2009

Topping out ....

Note: I will be traveling again and will not be able to post updates today and tomorrow. I should be back on Wednesday morning. I will try to check in here and there. Good luck.

Previous Trade Day
Well Friday worked out as another sideways day that hit the targets we were looking for. We formed the top in the first 40 minutes of trading, then retraced towards our targets and had the turn around I had mentioned in the comments.

We are in the process of finalizing the current up run and pattern that could occur in the 770-779 range. This should occur either today or tomorrow. As we have built quite a large rising wedge we have to be ready for a stronger retracement, most likly a full 50%. Whenever you build wedges, especially one this strong you have to deal with quite a retracement. This could potentially bring us back into the 709-716 range.

The other scenario of course is a stall way before, if we do end up with a GAP open to the upside we have to be careful as the GAP open could represent the top of the day.

Mid Term
As you can see I have missed the mid term bottom, as much as I want to believe that our bottom is not in, I have to admit when I am wrong. While this bottom is within an acceptable margin towards my forecasts I am still a bit frustrated. It seems I have done the mistake of being too bearish and focusing too much on one side of the trade and not carefully reviewing all data in front of us.

While we have quite a retracement ahead of us for the next 5-7 trade days the 709-716 range should hold. It is very possible to bottom out slightly before then around the 724 but we have to wait first to see how high we will top out in the wedge.

Once this point is reached we can make our calls for the top and duration of this rally, we do have a potential to run this well into the 800's by end of May. Best case scenario is anywhere in the 850-880 range.


  1. decision is right here, either top out or 780. Next 5 min will decide.

  2. we officially stepped out of the wedge, strongest 60 min down bar for 5 trade days on the breakout. The question now remains how far down it can and will take us.

    Also topped out at 774.50 exactly the middle of 770-779.

  3. do you think drop to 730 and rebound to 800 before final collapse?