Well, we got our double close below the 8SMA on the 15min chart. A little while later and we were breaking the channel. The tech stocks gave it up early while the financials (except GS) were keeping the SPX afloat. But it all came apart as all the gains were given up and we got our reversal day.
So tomorrow we should be testing SPX 743. In fact, I would be surprised if we didn't test it during the Asia/European sessions. We should test it before we get any double close above the 15min 8SMA, otherwise the bears have no strength and it will likely hold for another test of today's high.
However, 743 will fall because the real battle is brewing in the 707-720 area. This is where the 50% and 61.8% fib retracements lie. And right in the middle is strong support at 713. If we did in fact finish w4, then the bulls will fail here. If we somehow are already in primary w2, then the bears will fail here (or at least will not have the strength to take out the bulls 2nd line of defense in the 692-700 zone.
Still short, will likely cover some positions in this zone for a wait and see. If the bounce is weak, I'll reshort.
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Nice job! do you think we'll see 713 this week given the 2 day Fed meeting, or will we hand out at/around 743 for a couple of days?
ReplyDeleteThanks, nice blog
Rich - how does someone get in touch with you? My email is patrickfeeney@hotmail.com.
ReplyDeletealphahorn - if we don't see 713 by Wed, then the bears are in BIG trouble. If we hang out at 743 for two days, then the bears are in BIG trouble. So essentially, we should see 713, and if we don't we should all be long.
ReplyDeletepfeeney - you can get me at atechcpa-ewcharter@yahoo.com