Well yesterday I was wrong in stating we'd have a rally continuation in the coming days. That still may happen as this current sell off isn't that convincing internally as the VIX barely spiked 4% so far, volume isn't stellar, and the NYSE internals are bearish but not jaw-droppingly bearish. However, the decline this morning has traced out a clear 5 wave drop, so any crazy bold bulls in this market might want to observe the market here. Just above 1100 is key to the short term bearish case at this point. A strong close below the long held support of 1080 would be deadly to the S&P.
I was also wrong on the GBP/USD tracing out a triangle that was going to thrust lower. The pair actually thrusted higher, but did not hit my long held stop of 1.6295 and ended up reversing sharply this morning. This pair is still severely lagging the decline that the EUR/USD is undergoing so I would like to lower my stop in the near future.
I almost feel I shouldn't have posted anything yesterday, lol!
4 comments:
regarding, from your article, "I almost feel I shouldn't have posted anything yesterday, lol! " -
oh, no, don't do that ;-) besides, we all know the feeling!
and if this ain't volatility speaking through our efforts to understand, then i don't know what is (though i do think this is baby volatility, just starting to crawl ;-)
thanks todd!
Todd - A question on the bigger picture - Since wave 3s are typically longer than wave 1s, and wave 1 for S&P moved 900 pts (Oct 07 thru March 09), should we expect Wave 3 to move more than 900 pts? That would take the S&P to around 200 or lower. Yikes!
Thanks for the support Adan!
Todd
Dave, "yikes!" is right. The S&P may in fact fall over 900 points if it's a wave 3. But we should also view it from a percentage basis as well. The S&P dropped from 1576 to the March low of 666. This is a 910 point decline, or a 57.7% decline from the high. So wave 3 may just decline more than 57.7% from the high, which would make it larger than wave 1 percentage-wise. a 57.7% decline from the current 1150 high would be 486. So perhaps it will only go there. Also keep in mind that if it's just a wave C, then all it really should dow is get just below the 666 March low. I doubt this will happen though, and do believe this market will get to at least the 450-550 area before finding a significant bottom.
Todd
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