Ok we finally confirmed the breakdown of the bull channel (light green). SPY was not able to recover the channel and closed comfortably lower. It also broke through the rising wedge which was recently adjusted because of a prior breakout. What do you know it broke out again!
The grey bar represents when I think the next low will be made. I believe it should be at the lower part of the trend line which would correspond to about 60 on SPY or 600 on the SPX. Now that is just an estimate, it could be pushed out further with the FEDS huge injections of liquidity as well as Obama's 700+ billion stimulus package. This would just cause the low to be lower potentially in the 500's.
Tomorrow and Monday will be interesting. The markets look weaker as the bulls have given up their trend. I will post an e-wave chart this weekend.
I really expect the commercial re market to implode after the New Year. Many retailers will close up shop, consumers will spend less causing more retailers/small business to close up shop which in turn will lead to less consumer spending....wow a vicious cycle...
2 comments:
i think this is 3 days in a row you have redrawn the trendline...now thats confusing and you certainly cant trade off of doing that. You would have shorted 2 days ago, long yesterday, and short today = whiplash amigo.
I moved the trendline supporting the bullish case because we kept breaking down. To give the bull case the benefit of the doubt and yes I shorted. I am not day trading so I am not in and out of positions all the time.
I am looking at 600's for spx by mid jan...
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