Equity Markets: Technical Update (11-07-08)
Saturday, November 8, 2008 at 3:09 pm
We’re in a flag formation which is much expected after a -10% move down. Friday was an interesting day where we just zigzagged up and down forming a triangle for most of the day. And yes, we did have another WTF moment in the last hour of trading. I can almost say that the spike in the last half-hour was due to program short-covering because the volume just didn’t convince me that it was real buying. If we do not breakout from this flag, then this is a bearish continuation straight down to test the lows.
SPX 1-day
SPX 10-day
SPX 6-month
NASDAQ 1-day
NASDAQ 10-day
NASDAQ 6-month
Whats your market prediction from your tea leaf reading?
Hey if the market does rally from here, and S&P breaks above 1000, it could be an inverse head and shoulders.
Holy crap, is that girl on the six month SPX chart doing what I think she’s doing?
Dayum, I think after doing something like that the only way out of eternal damnation is like, joining a convent or something.
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Right, but the ‘right shoulder’ requires a price spike on huge volume for it to be considered a “higher low”. Volume has been declining each week and that does not support a rally. We have to take on the 20-day MA first.
IMO we get the volume and price spike Monday. We will gap above to 20 Day MA and retest. That will be the time to go long or short depending if we have a successful re-test.
Looks like that holds true as of tonight’s trading
just need a 3-4 billion share day…
I don’t know where that money is gonna come from though. People need capital (that they didn’t lose) to fuel a sustainable rally.
I’m banking on the cash on the sidelines far outweighing the cash withdrawn by retailers, hedge customers and 401kers to get things started with foreign investment following suit. That said, I still think we have another leg or two to go on the downside after this rally and those awaiting better prices may not jump in for this ride up but we shall see.