Monday, June 22, 2009

Market Unfolding as Planned, 880 S&P Cash First Target; June 22, 2009

Last post on June 18 I projected a sharp rally to suck in the last bulls and finish a 3 wave corrective rally and resume the decline. My target was around 930 cash for the short term rally to end and it made it to the 927 before topping. Then a small 5 wave drop occured Friday and now this morning, right on time, the market is selling off sharply. My S&P cash index target is 880 for the immediate short term, but this market possibly has much much more bearish potential. So I won't be anxious to completely liquidate my positions. The break of 900 in the S&P today caused me to add to my short positions and a cash index close today will cause me to probably add to my short futures position.

The market is weak and can fall much further in the near future. But 880 is the first wall to break down. A strong break in that level can result in a an acceleration to the 800 level.

By being patient and sticking with my analysis and not letting emotion take over my trading strategy, I've gained back over 4 weeks of losses in just 6 trading days as the market stands now.

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