SPX made a LH and LL and closed in the positive that is positive for the markets. The first high came at 7 and a little zigzag decline took it to the low of the day around 12.00. SPX then took off and erased the entire decline and closed at the high of the day. RUT also made a LH and LL and closed in the positive. Its pattern was similar to SPX. It also closed at the high of the day. That in my books means we will get a 0.8% or roughly 6.5 point decline sometime tomorrow. Dow was down a mere 3.3. All the indices were down almost all day. This prevented people from buying until very late in a short covering rally at the end of the day.
The chart on the left SPX hourly. There are four sections in this channel. Wave 1 went up 2 sections Wave 3 went up 3 sections and if this Wave 5 were to go 2 section that would take it to 1312. It stopped at the median line of the top section. Next Gann number to watch is 1314.
The chart on right RUT daily. It is not on a 1 point scale. It is best fit to keep RUT above the 1x1 line. It found resistance at the 3x2 line and that has happened before with some harshness and support at 4x3. The support is very weak. I expect RUT to test the 1x1 line at 680 or so currently.
The chart on left is also RUT daily in a different take on it. I have marked the previous rally points in terms of percent rally to the big decline from 856 to 342. The 61.8% point is at 660. Last Jan. the decline similar to now ended with a 10.7% decline. It would take a 15% decline to get to 680. From the channel, the 61.8% decline and the 1x1 line my sense is RUT is going to 680 roughly.
I am still short. Last time day 180 on another count was very disappointing. Tomorrow is the big day 144. May be this one will not be a dud.
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