Tuesday, March 22, 2011

Furious next few days

SPX had an inside day with LH and HL and closed in the negative.  IMO that is negative for the tomorrow.  RUT had a HH and HL and closed in the negative.  That also is negative because it is the first negative day after 3 positive days. Streaks have to start with a one .  Few Fib. numbers.  1344 to 1294 decline was 50 points the counter rally to 1332 was 38 points or 76% of the decline.   Next decline was to 1249 and that was 83 points 167% of first decline and also the declines were expanding.  This counter rally to 1300 is close to 5/8 of 83 point decline. It is possible but IMO nor highly probable that SPX would do the same 76% rally to 1312.  I am of the opinion this rally has ended and declines would start again as early as tomorrow.
This is my hourly SPX .  After hitting the bottom of the channel and finding support it has penetrated the median line and is very close to the upper line which it is likely to hit and come down rather sharply.  Usually there are 3 distinct bubble in a counter rally and I see those on this rally very clearly.  SPX is at the middle point of the triple top decline and that is a resistance point.  All said I see declines starting again very shortly.
This is my TNA daily.  I have marked the top half the bottom half and the respective median lines.  Don't mistake me the long term trend is still up until Line 2 of the slow channel is broken around 54.   The channel that is in jeopardy and IMO it will be broken is the fast channel.  TNA came all the up to intersection of the median line of the fast channel; median line of the top 1st quarter of the slow channel and the top line of the decline line and got stopped.  It should now start its descend to the lower line of the down channel kicking it out of the fast up channel. Exciting days ahead..
This is my hourly TNA.  After finding support at the lower half median of the fast channel and rallying back TNA got rejected at the median line.  It did go above the DOMA 77.  
Even though the appearance was nothing much happened a lot actually happened today.  Early morning was the end of the three day sale.  The markets are at a tipping point.  Anything were to happen that sends this market out of control the furious nature of the decline will show up.  Somebody has been selling a lot of stocks the last three days.  Pros always sell into a rally and retail  always buys. 

I am bearish but will not hesitate to jump to the other side.  I will be watching the indicators closely. 

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