Apr 17, 2013

Short term update

UPDATE: One more push lower for divergence on the smaller time frames as expected. I think it is time to take some profits.

What should I say? Here we go again:) The move yesterday stretched enough to the upside to hit my stop(for 1 point) and make me doubt. The system is anyway on sell and it is not a problem to re-short again today, not a drama. This market is day trader's paradise.

If you are a big bear I must disappoint you - the whole crazy action which we are seeing, burns too much energy to the downside. Technical and market breadth indicators say we are already in the middle of the correction and the price went nowhere. There will be one strong final move lower(which is typical for all corrections), but I do not see something more than normal correction 7%-8%. Possible targets - correction 8% 1469, support previous top 1470, 50% Fibo retracement 1470, trend line ~1450, MA200 ~1450, 61,8% Fibo 1440 - watch the area 1450-1470. Overall the bigger plan is being confirmed. Buy the way the price still has not broke the last minor support level ~1539 and EMA50 on the daily chart.

It is some odd expanding formation and SP500 is already in the fifth wave. The logical conclusion is to expect 3 waves up. The index is still above EMA50 and support 1539 so I think there will be one more move to 1575.

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