11/20/2011 9:01:09 PM
Keystone Speculator
Posts: 32
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Last week the sideways symmetrical triangle failed; this chart is the 60-minute chart that highlights the last couple days of trading. No back test of the trend line has occurred--yet. SPX range of 1210-1225 is important, potential ascending triangle with 1225 base line in progress now (green), that would take price upwards (green dot). Also a potentail bear flag down in progress; 1260 to 1210 first leg is 50 points, thus, after consolidation now, say second leg begins at 1225; 1225-50=1175 (black dot). If the failure from the sideways blue triangle continues, the target is 1240-80=1160 (blue dot).
This move downwards from the blue triangle may still be a fake-out move and the first couple days of trading next week will answer that question. Price upside is also supported since a back kiss of the blue trend line did not occur, and that would typically be expected, especially for such a key trend line. Indicators are agreeable to seeing some loft to price so pay attention in the 1220-1225 area early this week.
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11/20/2011 9:02:39 PM
Keystone Speculator
Posts: 32
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Eureka, thick-headed Keystone finally figures out how to post a chart. We can watch to see how the breakdown from the sideways triangle proceeds.
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11/20/2011 9:06:09 PM
Keystone Speculator
Posts: 32
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SPX Daily Chart testing 38% Fibonacci Retracement and 50 day MA:
Note that price is supported by strong horizontal support at 1210 to 1220, the 38% Fib retracement from the October rally at 1213, and the upward rising 50 MA at 1207 or higher. Price failed last week out of the three-week sideways triangle (red lines in late October and November) and has not back kissed or made any move to indicate a potential fake-out move from the triangle, at least not yet. Early this week we see if the intial move down from the triangle has staying power, or not.
The loss of the 1210 level would ensure that the market bears will stab under 1200. A failure of 1210, since it is a such an important confluence as highlighted above, the 1207-1220 area, will be very bearish. The indicators are in favor of this further weakness. The light green lines showing lower indicators as price places a slightly lower low than early November. This means that the price will want to come back down to make lower lows again, even if a bounce should occur in the coming days.
If 1207-1210 fails (a 50 day MA failure will receive lots of attention by talking heads), the next target lower would be the gap fill at 1196 and 50% Fib at 1191. The 1196-1199 area is a strong support cluster so the bears receive another feather in their caps if they move price thru this hefty support area. 1193 is also strong support with the next area of strong support at 1181. Thus, should 1207-1210 fail, the confluence at 1191-1196 is a likely target.
The market bulls have to regain 1220, then set their sights on 1225 resistance. Watch 1220 and 1210 in tomorrow's session; the move from this range will show which side has the upper hand. The RSI is under 50%, postitive divergence is not in place for the last three weeks so there is no help to bounce price, indicators prefer further weakness, price is under the 20 MA, price also under the 20 week MA, and the 150 and 200 day MA's are negatively sloping, all bearish indications. The market bulls need to hold 1207-1210 and hope the stochastics now falling into oversold territory will start to provide some turn around upside.
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11/24/2011 5:44:15 AM
Keystone Speculator
Posts: 32
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Textbook sideways symmetrical triangle. The 1160 target area is achieved. The surprising aspect is that price never back kissed the lower rail of the triangle when it failed at 1240, and a fake-out move from the triangle never occurred either. Price simply collapsed thru the triangle and never looked back, tumbling an equal distance of the vertical base of the triangle, which provided the 1160 target, now achieved. Note the falling wedge in place now over the last 2 or 3 days, and positive divergence, which will bounce price moving forward.
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