By Thursday the 17th the market will be very overbought on the daily chart and ready to rollover again. I suspect all the lower time frames will be overbought by then too. With the media remaining positive over the deal and the market continuing to ignore a “no deal” outcome we have the perfect storm setting up.
Anyone still long on the 17th is just asking to lose it. The only move left is some exhaustion “Hail Mary” push up at the last minute that has very little chances of holding as we are just too overbought right now and especially by Thursday. While they could push on up to a double top I wouldn’t bet on it. It’s a short today through Thursday as it could turn down at anytime. Layering into to shorts over the next 2 days stands the best chances of success I think. We are missing that final wave C down and the 200dma is a magnet just waiting to be touched.
Today was a “5” trading day and important highs have been occurring on them and this isn’t an ordinary 5 either. It is 100 tds from the May 22 high and 50 tds from the early August high so a potential 50-50 td cycle in place. We have also three white bars in a row which can be a topping pattern. A component of a certain little indicator popped above the 0 line on Friday and rose marginally today which isn’t denoting major strength in the markets despite the rise the last few days.
The certain little indicator turned and dropped below its 5 and 8 day moving averages 7 trading sessions ago and if one looks at the charts once the occurrence takes place, the indicator tends to trend in a downward fashion for quite a spell. (The 5 crossed below the 8 early last week to complete the trend down in motion) Today, the indicator has reached its declining 5 day average so time for an abrupt reversal back down? Haven’t looked at the 60 min indicators yet but they were showing some divergences on Friday but I am sure they are showing complete divergences at today’s close.
I’ve been looking at a correlation to the late May secondary high of 2011 (with the initial Bin Laden top on May 2) to now but it might be even later in the game than that since a certain little indicator is at such a low level.
Yes Peter it could? It’s hard to know the exact date for the top but we are close now I think and a wise thing to do would be to start layering into short positions at each various move up. We know it’s close but it could tank at any moment. I’d rather have a 1/3 or 1/4 short position on then miss the move entirely. If it continues up into the 17th then I’d just add more shorts.
I think you were terribly wrong. Next stop 1740s and beyond.
Coca Cola Trend update: http://niftychartsandpatterns.blogspot.in/2013/10/coca-cola-trend-update.html
Bulls should buy this dip as there’s plenty of room left on the BULL EXPRESS… http://reddragonleo.com/wp-content/uploads/bull-train-overloaded.jpg
“Relax! Government won’t run out of money Thursday”… If that headline doesn’t scare you nothing will. http://www.cnbc.com/id/101113997
VXX breakout signals a top in the market soon… http://screencast.com/t/SFeXXYtXa
By Thursday the 17th the market will be very overbought on the daily chart and ready to rollover again. I suspect all the lower time frames will be overbought by then too. With the media remaining positive over the deal and the market continuing to ignore a “no deal” outcome we have the perfect storm setting up.
Anyone still long on the 17th is just asking to lose it. The only move left is some exhaustion “Hail Mary” push up at the last minute that has very little chances of holding as we are just too overbought right now and especially by Thursday. While they could push on up to a double top I wouldn’t bet on it. It’s a short today through Thursday as it could turn down at anytime. Layering into to shorts over the next 2 days stands the best chances of success I think. We are missing that final wave C down and the 200dma is a magnet just waiting to be touched.
ES Chart analysis: http://niftychartsandpatterns.blogspot.in/2013/10/es-support-and-resistance-levels_15.html
Today was a “5” trading day and important highs have been occurring on them and this isn’t an ordinary 5 either. It is 100 tds from the May 22 high and 50 tds from the early August high so a potential 50-50 td cycle in place. We have also three white bars in a row which can be a topping pattern. A component of a certain little indicator popped above the 0 line on Friday and rose marginally today which isn’t denoting major strength in the markets despite the rise the last few days.
The certain little indicator turned and dropped below its 5 and 8 day moving averages 7 trading sessions ago and if one looks at the charts once the occurrence takes place, the indicator tends to trend in a downward fashion for quite a spell. (The 5 crossed below the 8 early last week to complete the trend down in motion) Today, the indicator has reached its declining 5 day average so time for an abrupt reversal back down? Haven’t looked at the 60 min indicators yet but they were showing some divergences on Friday but I am sure they are showing complete divergences at today’s close.
I’ve been looking at a correlation to the late May secondary high of 2011 (with the initial Bin Laden top on May 2) to now but it might be even later in the game than that since a certain little indicator is at such a low level.
Yes Peter it could? It’s hard to know the exact date for the top but we are close now I think and a wise thing to do would be to start layering into short positions at each various move up. We know it’s close but it could tank at any moment. I’d rather have a 1/3 or 1/4 short position on then miss the move entirely. If it continues up into the 17th then I’d just add more shorts.
keep one thing in mind red, friday marks 18 days of the shutdown. could be viewed as 1+8= completion