Anyone else have that album? It was my first S&G album, circa 1965. Bleecker Street, Sparrow, an acoustic Sounds of Silence. What a spiritual awakening that music triggered and it's still with me today.
Nonetheless, this morning's stock market rally is within parameters of my EW bearish scenario, so I am not chasing and in fact, even more resolute that the ultimate resolution of prices will be hard down in the weeks ahead.
A
7 comments:
The market/ econonmy is in bad shape. Yet, the Dow is at the same price it was about 3 months ago.
Why? The notion of free stock and bond markets are disappearing.
As long as the government is willing to buy stock and invest in companies that would otherwise be trading at 0, the move down will be a grind.
You can see how this straight down decline suddenly went to a crawl when Uncle Sam started buying.
Such government heavy handedness turns my stomach. Captialism and free markets are dying.
I agree this is an upward correction (2) of 5. SPX could get as high as 889 to 896, before (3) of 5 down starts.
My downside target for the Dow remains 6800 to 7187.
Alex
Good luck. Seems to me that when you've been on a hot streak so long following one model, it becomes harder to break from it, or at least tweak it and acknowledge anomalies.
Sometime this is simple, sometimes not. There is a head and shoulders bottom on the hourly S&P chart that has a target of 900. The 618/ 666 retracement is near there, so that is a reasonable target.
Although I am currently out of SDS, I plan to buy back in at $70 or better. That might correspond pretty close to the 900 +/- target. "We can't time no stinking market....but we can get close."
"at least tweak it and acknowledge anomalies"
There hasn't been an anomaly yet. If we break above 943 without a downward move then a lot of EW analysts will be scratching their heads. THAT should not happen.
I personally have shorted a little at each stop--38.2%, 50%, and if we make it to 61.8% then I'll short some more. A couple years ago I dollar-cost averaged into long positions so I don't see why I can't do it to the short side now.
When the cash S&P gets to the 882 area the trouble should start. I'd be suprised if tomorrow is another 20+ point gain for the S&P. Likely the S&P will rise, but it will be up less than 10 points.
The head and shoulders target is about 900 and then the 61.8%/ 66.6% retracement is 889/ 896. (2) of 5 should end there.
We'll have a better picture come Friday.
Alex
BTW, I agree, if SPX gets above 943 then we'll all have to question if the trend is still down.
I'm thinking SPX will end this upward correction between 889 and just below 900.
Alex
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