Sep 19, 2010

Weekly review / Седмичен преглед

Hello traders,
two weeks ago I have sad, that the momentum on the weekly chart is UP and we should follow the market. Two weeks later we have higher prices but this move looks tired.
The big picture has not changed - the histogram on the weekly chart is rising, now its above the zero line(we have MACD cross) and EMA5 crossed above MA20. So we have still bullish signals.
But as I have sad this move is looking tired we are hitting resistance at MA200(SPX500 is at his old highs) so we should be cautious now. Possible scenarios are shown bellow.

Short term picture(15min chart):
I think next week we will see a correction. It could start on Monday or we can see one last thrust higher before it starts.

Intermediate term picture:
Because the weekly chart is bullish for now we stay with the market and expect that the correction will be short lived 2-3 week retracing more time then price and reseting the daily oscillators before we break above resistance and MA200.
BUT we must be cautious at this point. If we break the lower boundary of the triangle all bets are off. This lower boundary represents the trend line from the march low too(see on the first chart). It connects the last two lows. The bearish scenario will play out, so I represent the alternate scenario - the beginning of a wave C decline and the H&S pattern playing out.

Long term picture:
The bullish picture is shown bellow. If there is no surprise we will reset the daily oscillators and see higher prices into the year end.

If we break the lower boundary of the triangle expect wave C to around ~9100. If the things get ugly even ~8000.

No comments:

Post a Comment