Wednesday, November 4, 2009

Morning Post

Wuz up? Tiggers are wonderful things. They are bouncy trouncy like this market and it may finally be time to get some bouncy upwards action, but how much? Waiting on the Fed may keep volume low and some on the sidelines.

How big will it bounce? Not big enough if you are a bull. If you are a bull you better become a bear IMHO. When the weekly charts rolled over they became the dominant player on the block. The 60m and daily charts are at its mercy being pinned under the weight of the fictitiously overbought market.

The market is at a very precarious point based on the 60m and daily indicators. A move down here could be in order, but if not a stronger move up will happen. The trendlines on the indicators I will show you below show exactly why.

60m SPX Chart - I've been patiently waiting for the divergence on the 60m RSI to come and it was set yesterday (and the corresponding bounce came with it). BUT the upper RSI resistance trendline is now in play. Will it crack or keep downwards pressure on the market for another day or two?

Daily SPX chart - Price is supported here by the lower trendline and the lower BB. MACD looks bad, but the HIST has turned S Sto is embedded. RSI has flattened and volume is dead. What concerns me here as to the strength of the upwards move in the trendline on RSI. Will it be able to break thru or will it be the force to keep the market down. This spot will be key.

Weekly SPX chart - This chart is particularly nasty. Just look at the indicators and the red trendlines that have been violated. The top is in IMO (85% now). These indicators will drive the market down. You can expect negative weeks to outnumber positive weeks significantly over the next several months.

/ES 60m - The channel down for wave 1 of P3 has run it's course. The red line is the 38% fib for the run up to the top off of the 866 low. The wedge up and out of the channel is kicking up off of the 38% fib and the lower P2 (bull market) trendline (blue). That is a clear trendline break and should lead to more upside.

/ES weekly - Just thought I would throw this one in for visual effect. See the indicators turning south.

I suggest you follow the fibs on the SPX for upside guidance (unless the Fed and the GS bots get a hold of this market and provide some really screwy action up. Employment Friday may have some bearing if CNBS parades more false and misleading numbers.

Resistance numbers on the SPX are -

50ma - 1052
BB 20ma - 1071
50% fib retrace - 1065
61.8% fib retrace - 1074
Resistance point - 1080 (if it tops this I would be very surprised)

Watch that upper trendline on the daily RSI. If it cracks more upside than i am expecting should occur. I'm guessing it cracks and sets a lower high.

Gold is topping but still has some room to run IMO and SLV may be a good play as it tends to run past gold at each top. I'm gonna do a gold post this am and show a chart of this action. Look for gold to pull back to or near the monthly 20ma for your next entry.

The Dollar, EUR/JPY and EUR/USD all might work in favor of the market.

GL today.


  1. moron here...good stuff, do you ever chart the china market...I trade this FXP, curious what the counts look like there considering China bottomed first and seems to have some leading tendencies...ramp fest today and of course I missed my long entry...probably dangerous anyway...

  2. Shanghai index. Use the chartbook drop down box to see all the things I chart.

    Daily -[s175810556]&disp=P

    Weekly -[s175815116]&disp=P


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