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Monday, November 2, 2009

Monday Updates

Somebody asked the question in the "lounge" today, What makes you think this sell-off will not end like the sell-off from 956?
Here is the quick answer, VOLUME, during the sell-off from 956, volume was decreasing, and now, the volume is increasing!! (click on the above chart to see the difference in volume)
After the Bell update- Looks like we might of printed another 1-2 today. As long as we keep making lower highs and lower lows this bearish option, or one that is very similar is the most likely path for now. 1052.18 needs to hold to keep this count going for now (also where my stop is set), any moves above that would require me to rethink and change the count. The oversold conditions did get a chance to burn off some today. It was a volatile day as the market traded in a large 21 point range ending the day up 6.68 points on respectable volume. Breadth was 1.14:1, Advancers over Decliners.
** Warning-The last time we had three 1-2's, in a row, was back on the sell-off from 956, I still have nightmares about it. It makes me feel like urging some caution to the bears to watch those stops!!
The Omen: 22 new highs, 13 new lows

Looks like the SPX is back testing the old trendline of support (red dashed line) this morning, if the Bulls can not penetrate through this resistance, it might be all over for them.

So far this morning the volume is really light, this mini rally does not seem sustainable without some build in volume. Leaning towards the more bearish option unless buy volume increases. I have three different counts that I see possible, this one would be voided if 1066 is taken out, and is the most bearish in the short term.


  1. Whatever the count is, I think you're right about the downside extension! Thanks, interesting charts Col. -pat.

  2. Col, been pulling my hair out since the close trying to decide on a count,and ultimately went with yours. Nice job.