The decline starts slow and then will build momentum. They need the dip buyers to remain confident. Also, they seem to hold up the market into Wednesday so the AAII and Investor Intelligence polls can get bullish and then we see the sharp drop on Thursday.
We just got another 111.55 intraday FP… which means that it's very likely that any gap down tomorrow will be the bottom for the day, and the rest of it will be a grind back up to the FP to shake out the bears that went short today.
So be prepared to bail out tomorrow morning if the jobs data causes a gap down. I suspect that the selling will die off fast, which will allow the 60 minute chart (which is currently oversold, and will be very oversold on a gap down tomorrow morning), to reset back up to overbought by the end of the day tomorrow.
This would set Friday up for a nice move down, should this scenario play out? As Jim pointed out, the VIX isn't supporting this sell off today. While I still think we are going down to the 107 FP area, there will be shakeouts along the way.
I don't think we are going back to 1010 at this point Jim, but 107 area is already foretold to us… that one should hit for sure. But, I'm afraid that it will only be a backtest of the falling channels' upper trendling… and then we could go back up again.
Hopefully we go back to the 1010 level but this is not the conviction we need . I am starting to think it is positioning for another run up from a higher level.
The decline starts slow and then will build momentum. They need the dip buyers to remain confident. Also, they seem to hold up the market into Wednesday so the AAII and Investor Intelligence polls can get bullish and then we see the sharp drop on Thursday.
San,
On the spy, would the 111.55 level be a backtest of the broken triangle?
We just got another 111.55 intraday FP… which means that it's very likely that any gap down tomorrow will be the bottom for the day, and the rest of it will be a grind back up to the FP to shake out the bears that went short today.
So be prepared to bail out tomorrow morning if the jobs data causes a gap down. I suspect that the selling will die off fast, which will allow the 60 minute chart (which is currently oversold, and will be very oversold on a gap down tomorrow morning), to reset back up to overbought by the end of the day tomorrow.
This would set Friday up for a nice move down, should this scenario play out? As Jim pointed out, the VIX isn't supporting this sell off today. While I still think we are going down to the 107 FP area, there will be shakeouts along the way.
Dow Jones triangle updated
http://niftychartsandpatterns.blogspot.com/2010…
I don't think we are going back to 1010 at this point Jim, but 107 area is already foretold to us… that one should hit for sure. But, I'm afraid that it will only be a backtest of the falling channels' upper trendling… and then we could go back up again.
Hopefully we go back to the 1010 level but this is not the conviction we need . I am starting to think it is positioning for another run up from a higher level.
Today is just the start of the selling I believe Jim. Have patience, as I believe will we sell more tomorrow too.
What has me concerned is the vix is not going down at a rate that I like to see on sell day. needs to get over -6% fast
They are very stubborn.
Now where does it go??
The dam has finally broken… let the water come pouring down!