The news that dominated all day today was Steve Jobs of AAPL taking a medical leave and earnings from IBM and AAPL. Both reported block buster earning and revenue. I could not find a single spot where they were rating AAPL a buy in the morning. The talk was how Jobs was AAPL and AAPL was Jobs. AAPL after making the low at opening quitely moved up all day and after the closed moved up some more. The important lesson is to keep focus on the stock and not on news.
Had this Steve Jobs news hadn't come out everyone would have focused on earnings and the stock would be sitting at 360 before earnings and 375 after and that would have caused serious disruptions in demand and supply equilibrium on AAPL.
SPX made a HH and HL and closed in the positive that is positive for the markets. The first low came at 6.55 and the second at 8.00 abut a point higher. It moved up choppily to 1296.06 and dropped 25% of the range in last few minutes before close. RUT acted very differently. The first high came at 6.45 and the only low at 7.52 at 801 some 6.5 points lower from yesterday's closing. ( Pl. refer to Yesterday's post). It did not make a HH. It made a HL and closed in te negative by .01. Yet again it closed at the high of the day. Does history repeat itself I will know tomorrow if RUT pulls back 6.5 points during the day. The chart looks uber bullish.
The chart on the left is SPX daily from 1011 low on Jul 1st. The 360 degree cardinal is at 1296 from square of 9. Gann believed when a stock or index hits these numbers exactly a turn happens.Todays's high was 1296.06. There is a 3 point correction that needs to applied for SPX low was 1011 and the cardinal 0 degree is set at 1008. When I see 1299 I would short just out of little respect for Mr. Gann.
The chart on the left is SPX daily from March 09. It is straight 1 point per day Gann. SPX is slightly above the 4x3 angle line by 0.25 point. This line was a reistance on Nov 5th at 1225 and SPX dropped 50 points in 7 trading days . On the same multiple we could drop 56 points and take a breather at 1240. Should SPX proceed to 1x1 line it is at 1145 number. Ooops! That would hurt.
A small note. This market seems to go up on bad and good news. It is not behaving where any kind of TA is proving effective. Personally should the market not turn around very shortly I would quit calling a well thought about top and employ the excel method and forget TA for a while. Nah! I will see.
Thanks for reading my blog.