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Friday, November 27, 2009

Black Friday?

Quick look at the Russell.
Here is the longer term count I have going. It is on the bearish side, but I would like everybody to notice that I removed the P2. I am no where ready to call an end to it. There are many possible scenarios that could still play-out besides just the beginning of P3. For one, imagine that this whole rally from 666, turns out to be only wave A of 2 in a running flat or contracting triangle. So far we have three waves up from the low (666), a-b-c which could easily morph into on the first wave of a much larger corrective wave P2.
But for now, I believe that the rally from July has ran its course and now we are either in P3, or a new corrective wave down.
There is also one count from Binve that I am keeping an eye on, it is short-term bullish count, with a higher high coming soon to finish off this four month rally. It is also one of the few counts that seems valid, with-out breaking or bending the rules and can be found here-
There is No Better Breakfast than Pumpkin Pie and Midnight Black Coffee, from Binve's blog, Market Thoughts and Analysis

This is the bearish count I have going forward on the SPX, still unsure if the [ii] has been completed. The Russell looks like it is possible that the corrective wave wrapped up at the close, if so, Monday might be really ugly. I still have a bullish option that I have been watching in which this sell-off is part of a larger correction of the previous rally. Targets I am watching on the SPX are 1083.74 for more downside, confirming the trend is still down by making a lower low. And on the upside, a break above 1110.82 would make me rethink this count.
Breadth ended the short day at 5.95:1, decliners on pretty high volume for a half day. Volume today was about equal with the volume from Wednesdays full day of trading. I have a feeling Monday's volume will be above average, hehe!!!

After the bell, The Russell made it back to the lows of the day at the close, that should made a really nice looking bearish candle. 8:51, A look at the Daily chart of the Russell, the 20 day MA has now became resistance after the break away gap down this morning. The indicators are also showing that more downside is probable. The RSI is still in a downtrend as is the MACD. The chart is also sporting the death-cross, the crossing of the 50 and the 20 day moving average.

7:53, The Russell continues to be the weakest index, still widening that gap between itself and the SPX, as small caps stocks continue to suffer the most as traders look for safer bets. The Russell decisively made a lower low today and confirms the trend is still lower. Keep $601.36 on the radar because it has no business back up at that level, and would be very worrisome if that high was breached. 553.31 right now is major support, the previous low back on November 2nd. Full STO is still falling along with the RSI towards oversold territory, but still has more room to go lower!!

7:32, Looking at 1070 for the next level of support, there is the gap, and also trendline support together at that level. Even with the sharp drop down on the open, the RSI and the Full STO still have not bottomed into oversold territory!!

6:55, The SPX opened with a break away gap down and managed to take out the previous low set on November 13th of 1084.90, finally making a lower low. Breadth is currently running 16.42:1, decliners. There is an unfilled gap at 1070-1073 made back on November 9th that would love to be filled. On the upside breaking above 1110.82 would reverse the trend back to the bulls.
It is still too early to put a count on this with confidence, but a guess would say this move down might be wave i of 1 down, for the really bearish count, and the bullish count would be this wave was part of a correction of the recent rally and most likely would be the "c" wave of an a-b-c down, counted as a "B" wave or as a 2nd wave with higher highs to come.

6:42, The VIX opened with a break away gap to the up-side smashing through the resistance of the channel line, and is currently $25.93. Breaking above $31.84 would be really good for the Bears!!

5:29, ES-minis at one point reached 1072.75 last night. The Dollar stayed on a tear last night, at one point up to 75.58, currently 75.31. Asia closed heavily in the Red while Europe is up slightly in the green right now. Worse hit were HSI, down 4.84% and KOSPI, down 4.69%. The FTSE is up .42% and the DAX is up .59%.

1 comment:

  1. p2 or p3 col, doesn't matter as much as the pattern you show, divergences, gaps, etc - something's happening, trend changing or corrective, you've got 'em both ;-)