Wow,
The bulls didn't see that coming! Another wonderful day if you're a bear. With 266 million shares traded on the SPY, the market seems to be coming back alive again. Since the 1040 support broke the next major support is 1020, and should be the end of this first wave down.
With that said, I do expect the jobs numbers tomorrow to be fudged as usual. This could provide a nice bounce back up to... maybe 1040 area? Today looked like a wave 3 down from 1069.62. Basically, it looks like 1069 to 1046 area was wave one down, then 1046 to 1061 area was wave 2 up. Then 1061 to todays' low is wave 3.
Again, it could continue straight down tomorrow to major support at 1020, or backtest back up to create a wave 4. I'm not sure at this point? But, if you are still short, you should take some money off the table, as we will find a short term bottom soon and a rally back up will happen. Probably for the first few days of next week.
October 7th seems to be the primary date that most are predicting the next downturn to occur. I got out of my short today too early at 1043. I got in yesterday at 1060, so it's still a profit, but it's hard to get use too holding more then a day because I've been burnt so many times in the past.
When the market was going up you couldn't hold more then a day or two on any short position, as you knew the PPT was going to come in and rally at the close. So, I have to slap myself a couple of times so I'll wake up and realize that this is probably the start of P3 down?
At this point, I don't think the market has enough energy left to close that gap at 1100-1108. It might only make it back to 1060 area next week, and then a BIG wave 3 down! That's right folks! If the high was 1080, then wave one down will end today or tomorrow (1029 today's close or 1020 support tomorrow). That leaves wave 2 up until the middle of next week... maybe 1060? Then BAM! Wave 3 down will slap the living hell out the bulls!
Patience is the key... Now if I can just follow my own advice?
Red
Love the picture and caption “RDL”. Good analysis. I know the feeling of being burned holding over night. Also I know the feeling of NOT holding over night or weekend. I seem to get burned either way. LOL!
Now, if I can just get out of this long that I got in around 1032 yesterday. Damn… I can't even follow my own forecast. I predicted that Thursday and Friday was going to be a down day, and I got scared and got out early.
Then, I went long thinking that they would rally Friday on fake jobs number. Looks like another down day today. Slap some sense into me Douala.
he Red I guess we hit the bottom of the channel now rally up the the top of the channel?
Maybe another flat day on Monday, then a rally up Tuesday and Wednesday. After that… it's down we go! I'm not taking any long positions, as I got out of mine today with a loss.
Basically, I gave back the profits I made from my short on Thursday at 1060. I got out at 1043, and waited till the end of the day to go long (1031).
I sold today at 1025. So, I gave back that profit. I failed to follow my own forcast. Taking the emotions out of trading is the hardest thing!
The rally back up should be weak. Maybe back up to 1040? I think 1060 will be tough to get back too, but I'd love to see it. The higher it goes back up, the better the fall will be.
1060 would mess some bears up and would get longs back in if its trying to shake eveyone out before the drop that would work
Hi Red,
LAST WEEK -I posted several times on my blog that ANY rebound NEXT week should ONLY back kiss a descending channel
Jay
You're right Jay. I think 1080 was the top of P2. We should get a rally back up on Tuesday and Wednesday of next week, but after that it's down we go!
so 1040 would be the channel top and I would think that would be a good short and hold on for a while level….what do you guys think..
Yeah rrman…
I'm think 1040, but I wouldn't rule out 1050, at most 1060. The 1040 area was major support along with the 1060 area. The 1050 area was good support, but not major. Now they are all resistance.
We have to see what Tuesday brings? If it makes it to 1040 on Tuesday, then look for 1050 on Wednesday (and maybe 1060?).
Fujisan posted a nice chart of a channel today. Here's the link… http://content.screencast.com/users/Fuji-san/fo…
As you can see, she has about 1060 as the top of the channel, but I'm not sure if we'll make it. I'm just going to wait for Wednesday, (or at least 2 up days), as I believe that will be the high.
Alexander Grant has Wednesday as the high, and several others do too. I'm just going to wait… (believe me, that's hard to do!)
I'm just excite today as I almost 100% positive that P2 ended, and we are now in P3. Whoa! Reality finally sets in!
You're right Jay. I think 1080 was the top of P2. We should get a rally back up on Tuesday and Wednesday of next week, but after that it's down we go!
so 1040 would be the channel top and I would think that would be a good short and hold on for a while level….what do you guys think..
Yeah rrman…
I'm think 1040, but I wouldn't rule out 1050, at most 1060. The 1040 area was major support along with the 1060 area. The 1050 area was good support, but not major. Now they are all resistance.
We have to see what Tuesday brings? If it makes it to 1040 on Tuesday, then look for 1050 on Wednesday (and maybe 1060?).
Fujisan posted a nice chart of a channel today. Here's the link… http://content.screencast.com/users/Fuji-san/fo…
As you can see, she has about 1060 as the top of the channel, but I'm not sure if we'll make it. I'm just going to wait for Wednesday, (or at least 2 up days), as I believe that will be the high.
Alexander Grant has Wednesday as the high, and several others do too. I'm just going to wait… (believe me, that's hard to do!)
I'm just excite today as I almost 100% positive that P2 ended, and we are now in P3. Whoa! Reality finally sets in!
Maybe another flat day on Monday, then a rally up Tuesday and Wednesday. After that… it's down we go! I'm not taking any long positions, as I got out of mine today with a loss.
Basically, I gave back the profits I made from my short on Thursday at 1060. I got out at 1043, and waited till the end of the day to go long (1031).
I sold today at 1025. So, I gave back that profit. I failed to follow my own forcast. Taking the emotions out of trading is the hardest thing!
The rally back up should be weak. Maybe back up to 1040? I think 1060 will be tough to get back too, but I'd love to see it. The higher it goes back up, the better the fall will be.
1060 would mess some bears up and would get longs back in if its trying to shake eveyone out before the drop that would work