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Saturday, April 17, 2010

Week-end outlook!!!

If we get any more sell-off come Monday, the SPX could be in danger of losing all short-term Fib fan support, with the last bullish fan in the 1175 area, it is a must hold for the bulls short-term.
The short-term count right now is up in the air, and until we have some more price action to clarify the count, I am going to put them on the back burner, and spend more time watching trends, channels, and other TA. It was very interesting that the "new channel" held yesterday for support, and with a brief shot below 1188, we did make a lower low, putting the current uptrend in jeopardy, so for now, I believe the trend should be set at "Neutral" until we make a higher high, or a lower low, to confirm the trend. 1175.12, is a very important level now, which needs to hold for the bulls, besides the Fib fan chart up above, breaking below would also be making a lower low, and would also break down below the long-term trendline from 666, that you can see on the daily chart below, all bearish.

I am just playing around this morning with different charts and options, and keep coming back with the level of 1175 as being very important support, and figuring out what would be possible if 1175 does hold. I can see two options, one is the rally from 1044 is not finished, and this sell-off will become part of a 4th wave, or the rally has finished and would be labeled wave "A", and now we are in "B", which would be similar to the "B" wave we had back in November, before heading higher in the "C" wave. If 1175 does not hold, that would really open up a lot of different options, but I will wait for that to happen, and see how the waves of the sell-off unfold, that is are they corrective, or impulsive, and so far, it could go either way. Monday, will be very important in terms of the continuing wave structures, will it confirm the impulse wave down by completing the 5 wave count, or will we go back into a series of corrective waves. Also, for any meaning sell-off to happen, we would need follow-through come Monday, with high breadth and sell volume numbers and with Mondays following OPEX that have been volatile the last few months, this should set up for an interesting day.

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