Breakout or fake out? Everyone ready for some upside earnings surprises? I mean things are so freaking good that how can we not expect stellar earnings reports from every company out there? You permabears that are so down on the market, geesh, get a life (LOL).
Look, you have to remember all these freaking (I used my cuss quota for the month in the rant last night) rosy estimates, uh, they are comparing to the end of 08 numbers. They are comparing what they call apples to apples LOL. It ain't that hard to beat numbers from the worst quarter in history. It is all part of the game. Do you really think the GS analysts were gonna set earnings numbers based on 07 or 06? Nope, those would be "unrealistic". They make money trading and profitable (LOL) companies are good for their bonuses.
/ES 60m - Do you see the two royal blue trendlines? That is the P2 (bull market) rising wedge off of the 667 low (narrowing every day). The two sky blue lines are the rising wedge for the throwover top above the royal blue wedge. So price is about to backtest the throw over wedge and re-test the top line of the bull market wedge. These should provide resistance (along with the upper BB on the SPX).
The triangle breakout target is 1085. If this is the final wave of the C leg of P2 and 3 is 1.68 of 1 then the target is 1117. 1100 is where 3=1. Those are both assuming the market is still in P2 bull market run. One word of caution here is in the indicators on the 60m chart. There is a possibility of some nice divergences to price being set here.
SPX Daily Chart - SPX cracked the upper trendline BUT is sitting on the 61.8% retracement of the last fall. Upper BB is at 1078. You can see the lower support zone basically from gap to gap. Not sure what is going to happen as RSI yesterday lost some steam, but the MACD hist is not showing any weakness yet.
We're gonna get another gap at the open. Was that a flag on a pole formation yesterday in SPX? Are we going to pull back and form the inverse H&S everyone is screaming about? I'm thinking we might be in 3 of 5 up (this could be 3 of 1 of 5 OUCH) which means the last leg up to the top of the market. There is still a possibility that the EWT guys are right and 1080 was the top and the bear market has begun. Jury is still out on that. I'd hate for them to be wrong again.
I'll begin looking for formations her to either confirm the final leg up (another rising wedge) or to confirm the top is in.
GL trading. I have no open positions.