Sep 10, 2011

Weekly review / Седмичен преглед

The SP500 reversed exactly at the resistance level and closed at the trend line. As I said two weeks ago the big players stretch the moves to the max but without damaging the technical picture. We saw exactly that this week - huge gap down but to the lower trend line, huge rally but not breaking resistance, huge drop on Friday but finding support at the trend line.

The bigger plan has not changed - we will see lower low. First target is the ~1100 area, measured move shows target ~1110(second chart). When we reach this levels I will asses the technical picture and see if this is the bottom or we will go lower to the next support level around 1040.
Alternate scenario is surprise on the upside before a lower low (more on chart bellow).

The histogram on the daily chart is still pointing down(see above) so I think SP500 will move lower.
The intraday picture shows some positive signs and we are at the lower trend line, so I think we will see 1-2 green days.This up move should not exceed the resistance level and the down sloping line ~1175-1180. From there the move on the down side should resume.
If SP500 decisively break this area it will be heading to the ~1260 level(61,8% Fibo,resistance,the upper channel line) - that is the surprising yellow scenario on the chart above.
If SP500 gap lower on Monday all bets are off next stop is the support area 1120-1100.

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