|One minute 01/27/11|
The chart above is SPX weekly. I have marked Gann angles on the decline and the subsequent rally. The rule I am employing the point where the biggest rally occurs after the decline starts is set to 1x1 line and similarly the biggest decline point is set to 1x1 after a rally starts from the bottom. The 1 point per day on a horizontal and one point per 1/10th of a 1" by 1" graph on vertical doesn't always give the 1x1 line at the 45 degree line on a weekly chart.
The chart above is a magnification of the previous chart from March 2009 low. A closer look shows we may have a few more points. If it hits the 1x3 line tomorrow its at 1338 and in a week its at 1333. SPX is rallying roughly 5 points per week. Say that is kind of 1 point per day. I am slowly turning bullish today.
The chart above caught my eye. It Dow monthly with Doma 15. The blue line at 12260 will be a major resistance line. The last wave looks like it is has well defined 5 waves. I am not certain if dow will retreat to 10700 area kiss the Doma and go back one more time to get hit at the resistance 12260 or we go straight to 12260 and then fall to Doma. None the less this is worthwhile to watch this chart.
There is so much exuberance in stock market it is getting sick. Jobless claims were up 51K; Durable goods were down 2.5% and Moody's said US debt rating may be lowered from AAA based on budget deficit. But nothing mattered. The market piled on. In this environment it is quite difficult to be logical. It is easy to charge patrons $30 bucks a month and phony up some imaginary EW count and mark resistances and support every 2 points and claim that one is right always. This will be personal test... IF the market doen't turn right here I will decidedly move to excel based system that wouldn't forecast where the market is or where it going.
I am still bearish.
Thanks for reading my blog.