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Thursday, October 21, 2010

Thursday, After the close updates!!!

Here is a clip that is making the rounds and going viral, it is from the CAGW-Citizens Against Government Waste. It is a eye-opening, hard hitting clip that was well-produced and brings reality to the US debt problem.

The Summation Index finally has a sell going on the STO, after printing four red bars. The SI still needs to accelarate to the downside a little more to confirm a new trend.

After the close, The frustration is building as the SPX has entered its second month with a mess of over-lapping, corrective waves that make counting about 100% totally useless. In the last month the SPX has not had ANY impulsive break-aways that were not retraced immediately afterwards, leaving no points of recognition to even try and set 3rd waves. So for the time being I am not going to post much on the counts, after already backing off from them in the last couple of weeks. Trying to count and label squiggles is unless and does more harm then good, it is time to put EW on the back burner for awhile until we do get some decent(reliable) wave patterns going.
As long as the SPX continues printing higher highs, the short-term trend is up, however, the longer term charts are over-bought and are most likely signaling we are in a topping process, but the SPX needs to first start printing lower lows before calling a top. Tuesday the SPX was very close to entering a new downtrend, then yesterdays rally put that into question, and todays new high took that off of the table. The Russell still has not made a higher high this week, and the BKX is really lagging behind, all signs things are not rosy. Both the small caps and the financials are needed for a sustainable rally in a healthy market.
Breadth closed about as flat as the SPX, at only 1.04:1, decliners. The SPX closed up 0.18%, with the Russell down 0.57%.
Tomorrow is another POMO day, so odds are we will have a bullish day again, sooner or later this correlation will end, most likely very badly as more and more traders are noticing that POMO days have been good odds for the bullish. The FED has scheduled buys thru the election, not sure if that is coincidence or not, maybe somebody just wants to hold this market up until after the elections?

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