I’ve seen this move so many times in the past it’s becoming very predictable. When very overbought and near an important high/resistance level it’s common practice to sell off into the close to bait in some early bears while working off some of the shorter term overbought charts.
Then the next day the bears are trapped short while we see some gap up on bogus news to hit the important high/resistance zone and to then rollover and sell off for real. The early bears won’t short again as they got squeezed out and are scared to for fear other another squeeze the next day.
They sit on the sidelines and watch the move down to wait for a bounce to get short at but it never comes. When the bounce does happen it’s not a bounce but instead it’s the actual low and the bears get squeezed again.
I’m looking for the NFP report Friday morning to be manipulated to look good at 8:30am, which should give us our exhaustion gap up to hit the 1470-1474 spx zone. There is heavy resistance there and should stop the bulls on the first hit.
The top might not happen right at the open though as there is also the Factory Orders and ISM Services at 10am that they can manipulate to look good for that final push up. So, I’ll be looking for the high to happen in the 10am to Noon time frame if it doesn’t happen right at the open at 9:30am.
This will be a good spot to get short at in my opinion and let the move down tell us how far it want’s to go. We should at least see gap window at 1448.55 spx but realistically need to fill the gap at 1426.40 spx if the bulls want a solid level to rally from again.
Of course we could continue down past that as the high could be put in with the move up on Friday. Some how I think they want to take out 1500 and make a new high but there’s no guarantee that we’ll move back up higher after we rollover and start selling off.
Looks like jobs report tomorrow is having people hold…. I expect it to be good. if it is, then we see a pop and then sell on news event……either way I expect a sell off after jobs report…. I expect a friday sell off day
The lack of a gap up this morning tells me that we’ll likely drift down some in the morning and then back up some in the afternoon. The end result is likely a “pause” day or doji. Until that 1470-1474 spx area is hit it’s not safe to short this market in my opinion.
Also, Friday is an “eleven” day and many times (not always) important tops are put in on them. So if we do indeed chop around today and go basically nowhere then we will have a good chance of popping up to that zone tomorrow morning I believe… and then selling off some.
SPX Analysis after close: http://niftychartsandpatterns.blogspot.in/2013/01/s-500-analysis-after-closing-bell_4.html
I’ve seen this move so many times in the past it’s becoming very predictable. When very overbought and near an important high/resistance level it’s common practice to sell off into the close to bait in some early bears while working off some of the shorter term overbought charts.
Then the next day the bears are trapped short while we see some gap up on bogus news to hit the important high/resistance zone and to then rollover and sell off for real. The early bears won’t short again as they got squeezed out and are scared to for fear other another squeeze the next day.
They sit on the sidelines and watch the move down to wait for a bounce to get short at but it never comes. When the bounce does happen it’s not a bounce but instead it’s the actual low and the bears get squeezed again.
Rinse and repeat…
Thx Mr. Red……..lots of people looking @ 1470 ish…well me too! Smile! Expect the unexpected….crap!!!
I’m looking for the NFP report Friday morning to be manipulated to look good at 8:30am, which should give us our exhaustion gap up to hit the 1470-1474 spx zone. There is heavy resistance there and should stop the bulls on the first hit.
The top might not happen right at the open though as there is also the Factory Orders and ISM Services at 10am that they can manipulate to look good for that final push up. So, I’ll be looking for the high to happen in the 10am to Noon time frame if it doesn’t happen right at the open at 9:30am.
This will be a good spot to get short at in my opinion and let the move down tell us how far it want’s to go. We should at least see gap window at 1448.55 spx but realistically need to fill the gap at 1426.40 spx if the bulls want a solid level to rally from again.
Of course we could continue down past that as the high could be put in with the move up on Friday. Some how I think they want to take out 1500 and make a new high but there’s no guarantee that we’ll move back up higher after we rollover and start selling off.
EURUSD Support levels: http://niftychartsandpatterns.blogspot.in/2013/01/eurusd-chart-update.html
Agreed Bill… Friday should be a down day. Don’t expect it to be huge but it should go up first and then close red.
Looks like jobs report tomorrow is having people hold…. I expect it to be good. if it is, then we see a pop and then sell on news event……either way I expect a sell off after jobs report…. I expect a friday sell off day
The lack of a gap up this morning tells me that we’ll likely drift down some in the morning and then back up some in the afternoon. The end result is likely a “pause” day or doji. Until that 1470-1474 spx area is hit it’s not safe to short this market in my opinion.
Also, Friday is an “eleven” day and many times (not always) important tops are put in on them. So if we do indeed chop around today and go basically nowhere then we will have a good chance of popping up to that zone tomorrow morning I believe… and then selling off some.
Bank of America chart update: http://niftychartsandpatterns.blogspot.in/2013/01/bank-of-america-chart-update.html
FACEBOOK Bull Flag Update: http://niftychartsandpatterns.blogspot.in/2013/01/facebook-bull-flag-update.html