Check the spy chart from 3/4 to 3/18 then look at the chart from 5/6 to now, a smart man pointed this out to me, looks like longs may have a couple of days left.Charts like to repeat time and time again, if this is the case Wed or Thurs should be the day to put in your shorts and time to get out of longs, i think this will be the case, good luck all.........
"Apr 25, 2013 8:09 AM
4/23 spike down equals 3/1 spike down ?"
The Q is, will having completed,precisely, wave 1 up mean anything
will the algo bots continue their relentless drive up,in a fairly easily discernible fractal pattern,
to 1650 ?
The market fell on March 18 because of the Cyprus bailout (and its conditions). I think chart analysis doesn't really apply in a market that is almost completely influenced by QE and macroeconomic events.
Assuming your pattern analysis is correct, there will be a 1% correction after Wednesday with the market reaching new highs a week later. You can try a gamble with a short for a very small pay-off, but if you're long, you could simply take a week off. Of course, this assumes the pattern repeats. The charts say, stay long until a huge capitulation. You will know when it happens, it will be all over the news, something like "The DOW rose 1100 points today on , but closed up only 100 points after one of the most volatile days in the history of the stock market". I doubt you will seeing this type of headline any time soon, but who knows?
I do think an attempt to push the market higher is next up. However, I think it could turn out to be a lot of churning with only the slightest fractional gains above current levels. If that happens then I think a correction would finally come about, deeper than just another dip to buy into.
I see three likelyhoods
1. Riding the upper bollinger higher, in a "slow" 4-9 point per day grind with some down days sprinkled in for a few weeks
2. A pull back to old highs or less
3. A sell off due to something I've missed.
If it's number 3 I expect financials to lead the way down, GS and JPM in particular. I don't here the Wall Street whispers where I'm trading from, but either it's now or perhaps July ER season the cat comes out of the bag, if there is a cat.
I'm considering FAZ calls for later than July expiry. I'll have to "chart" it carefully if I do. Looking for cheap insurance in case of a meltdown.
I know, I know, FAZ is a horrible hold, but in the case of a meltdown that sustains it'self for any length of time it does have the potential to go ballistic.
First, patterns never repeat precisely. so to count the bars and project an identical outcome is too simplistic. Second, the peak in March wouldn't have yielded much downside so if that's the paradigm, shorting wouldn't be the play. But you got the advice from a smart man, so who am I to say?
I should of said that the uptrend may stay intact if 361 doesnt break at close, and i also should of said that it would be a short scalp, thank s for the correction, of course charts are not precisely identical, also take a look at the Vix, and how it has responded over the past Bull and Bear runs, its always good to see past patterns, if you back test the the Vix vs. Spy, there are clear patterns that have repeated, not exact of course but close enough to have made decisions based on the past and what is transpire ring in the moment, im not trying to make predictions on the future, but the similarities in patterns are worth noting, to be clear this is all just based on observation of actual historical facts, thanks chick for making me explaine myself clearly,dont want to sound like like a @@@@, good luck