Monday, April 19, 2010

Need follow through

Watching the market with care here ... considering how much selling we saw on Friday, we need follow through today with at least a retest of the Friday lows during cash hours. We did the overnight test on futures but that needs to be confirmed first.

Market is still hesitating here to go higher - we had the gap fill that was almost assumed but a break of the current high here will likely bring us back to 1197 SPX. So watch price action very carefully at the previous close and 1197. A break through those ranges will bring us back to 1204 SPX. Next 30 minutes are very important for anyone - bear or bull.


  1. Well we hit ~1217 and have been falling ever do you have a target lower boundary in which if we cross we continue lower? or are you on the sidelines since so much of this is driven by Greece and other fundamentals that charts may not be reliable?


  2. Still on sidelines, the first thing I am looking for is a lower low on the weekly chart, once we have that we can figure out what comes next.

    As you can see its extremely difficult to get into a position, be it long or short in the current environment. The first thing I am looking for is a weekly close below 1180-1183.

    That gives us a great chance to scale in there and use bounces to short. Looking at the daily chart you can see some wild swings in a fairly narrow range (big picture wise). Now the monthly chart is setting up to be a real beauty for the short side but we have to give it a few more days to see the month out. A monthly close around the above targets would be a great first start and I think we may get lucky here =)

  3. We have seen those type of one day events before and they all ended up with fast reversals followed shortly thereafter - so calling for a drop here is almost sucicidal so I rather give it more time before we can commit.

    However, in summary again based on my large post in January - we hit the targets off by a few points and this could be an ending 5 wave move here.

    I will post an updated chart some time this week with new targets from a longer term perspective and what to look for now.

    If we are indeed seeing a finishing move here we shall see a minimum of 120SPX pts on this first move lower. Of course not all in one day but it should bring us back to Feb lows. But its way too soon to tell - the market likes to trick us and this could just be a setup to remove overbought conditions on longer term charts to bring is higher - it seems thats the only direction it ever wants to go.

    If you are short above 1205 - great job, I say stay short and use partial hedges at key support, if you are like me without a position. Give it some time =)