On Thursday, the SPX closed at 1084.53, which is only 0.27 points off of the threshold of the Box of Beer (1084.80). How’s that for accuracy? The Fibonacci analysis that I did four months ago determined that to be a key level, and so it has been.
If the SPX can’t hold in the Box of Beer, it will fall back into the Box of Bulls where the first substantial support level is 1068.11. And, as befits an important Fibonacci level, there is a large unfilled gap right there. That gap opened on the morning of November 9th, and the market never even came close to filling it. This is the gap that George has been showing on his weekly charts.
For SPY, the gap is between 107.16 and 107.87, and it’s a fat, juicy target for this sell-off. If the market does indeed dive down there, it should find some sort of support. How long it lasts is another question.
Also, I think there is a decent chance that next Friday’s jobs report might show that the economy created a few jobs in January. Let’s see what Bloomberg’s survey of economists shows on Sunday.
Good to now that everything is still boxed in.
The futures visisted 1070.5 tonight which should be close to the target area. Then up to 1080 – quite often the overnight lows get revisited during regular trading so the close the gap trade might be today.
Yerk,
I’m rooting for the gap to be filled. I didn’t like SPY bouncing off it but that’s what it does – act as support sometimes. If it revisits it, I agree it will be closed and that will be fine with me as it will have been a target X 2.
Here’s an update of my yin yang / moon poo chart:
http://i49.tinypic.com/2r7se2g.jpg
i guess by now this is in the category of “who else knows dis—” -g-
Futures Prices
Market Last Change %
Crude Oil 74.72 +1.08 +1.46
Natural Gas 5.276 +0.138 +2.66
Corn 361.75 +3.5 +0.97
Soybeans 931.75 +2.75 +0.29
30yr Bond 117.96875 -0.1875 -0.16
10yr Note 117.5 -0.203125 -0.17
NY Gold 1089.3 +4.5 +0.41
NY Silver 16.355 +0.143 +0.88
Emini S&P 1088.00 +8.75 +0.81
Emini Nasdaq 1787.5 +17.00 +0.96
Emini Dow 10126 +64 +0.63
BAILED out of 1/2 SPX long in pre market for a small profit…think there is a little more downside left
GDP Growth Demolishes Expectations, Accelerates To Fastest Rate Since 2003
Fade the opening gap?
today’s pivoting point for SPX is 1088.59 just FYI
R1 at 1098.27
S1 at 1076.95
S2 1067.26 which is close to the important number Matt mentioned.
George says:
January 28, 2010 at 12:09 pm
If I was short, I’d be covering here. Get enough of them and that’s a reversal of some sort.
Nice call George. I will listen to you next time.
40 Short
I haven’t been able to fire up my trading platform for the week but i did today and what do I see? my trendlines have played ON SPOT!!!
here is a treat
http://i48.tinypic.com/52cabn.png
Enjoy
Larry,
Remember, I’m a short-term trader/scalper. My perspective may differ from yours. I often forget that when I make posts about price movement.
If I get out of my cave and look at the mountain, I may see sunshine or dark clouds.
K,
I really like those trendlines. I’m beginning to find out they help a lot.
i wanted to wait until tonight and make a blog post about it but i made it a trivisonno special instead.
haha wow thats something now.
http://www.businessinsider.com/russia-asked-china-to-dump-fannie-bonds-in-bid-to-collapse-the-us-financial-system-2010-1
George, you called the bottom in this downturn. I think.
There was a nice Tres Cruzar (actually, that’s the verb form of the word. I thought it sounded better than Cruz) on SPY yesterday which is still playing out, reluctently, and could be a Humpty on the 15min.
I’ll look for a break of the 5min to exit.
Larry,
I think this is only a correction unless the daily turns around. But there sure is a lot of strength – I suppose due to all of the good news coming out.
i want to remind you that in the US of A we sell the good and buy the bad.
dont forget it and you’ll be good to trade long term
oh and did we forget its end of month pumping? next time we open will be february.
K,
Good points!
I would say that IF the weekly gap had been filled, this reversal would keep going. But since it wasn’t, It will make the lunar landing and return to earth.
At least that is my demented thinking.
URE at tops.
George, I trade Europe so I couldn’t have listened to you before this morning anyway.
Baltic Dry down 115 to 2,848. This does not look very pretty. (Yes, I know the volatility).
Chinese New Year starts Feb 14. It shouldn’t affect the BDI now.
Larry, gotcha.
Stochastic and MACD cycles on the 1 and 5min have been picture-perfect so far. That could change if it goes into sleep mode.
Still seeing lower lows and lower highs.
If spy breaks beyond 110.5 I may go long
also my systems say market is now trending lower.
Pivot at 1088.59
FAILURE to take out 1100 not good..overlapping corrective rally…ie trend is down…if 1084 is taken out bottom could fall out
bouncing right on the pivot. hmm will it hold? my indicators are now 3/3 to the down side (this is for intraday plays)
oops there as i typed it fell below. let’s see is we will drop a big 10 from here
The 36MA on the hourly is providing huge resistance on all accounts.
i’m leaving for most of the remaining day so maybe thats a contrarian indicator and market will rally phil?
hehe
will 1085 hold, or is it broken? from earlier?
Ok George I’m staying over weekend. I have the popcorn out again.
George, I’m scalping! woohoo! Thanks
If you believe in chart patterns, SDS is making a nice cup with handle on the 5 minute today (using yesterday’s close as the left side high point)…note the deminished volume in the 20 minutes of handle forming now. Probably last through lunch….just a guess???
no waiting in aile 12….there goes SDS
Scalp away 2thfixr, the more the better.
SPY reversed at the trend line drawn between the Tuesday to Thursday peaks. Same for SDS valleys
I’m starting easy….don’t want to blow myself up!
corrective wave…will 1080 hold is the question. IF not, 1072 (gap) is waiting.
my indicators are now one green one red and one flat.
basically no decision zone.
George, look at the 1 min SPX please. at 12:23, the 9 MA is approaching the 36 from below. The STOCH is maxed out above 80, MACD appraoching zero line….running out of steam, or ready to bust up?
Will 36 MA of the 15 min at SDS 36.56 level provide the end of the correction?
The market is not impressed by this morning’s GDP number. Perhaps that’s because the housing data collapsed after the federal subsidies came to an end recently, and maybe the market thinks that that level of GDP growth can’t be sustained.
You’d never know that there was a housing problem, looking at the huge move up in the homebuilders and IYR. Grrrr.
Drano,
Well, the end of the housing subsidies was a known event, so it was likely priced in. But look at the XHB; it might be making the right shoulder of a head-and-shoulders pattern on the daily chart going back to December 22.
Matt
1104 line in the sand, below trend down.
Thanks Matt. I have to say that until housing cracks I don’t think we’re going to get the big downdraft to SPX 1040 or 1020 that so many bears are hoping for.
2thfixr,
Sorry I missed your post. I had to step out for a bit.
no prob….doing my own thing anyway! bear flag (bull handle on SDS) is looking to break out at 1:30….go SDS!
Brinks trucks for all the bears!!!!!
K, how about a triplet in RED!
Tops on SDS. Moment of truth… weekly gap fill?
George, if the 5-min is RSI 70, do you sell and ask questions later? Im’ looking for less than 1078….closer to 1072….
it isn’t there yet…but just asking…
Red triplets works for me.
2thfixr,
I don’t use RSI in the normal sense. I use RSI 2. Gives good bottoms/tops along with stochastic.
thanx
Watch the 15min stochastic and MACD. That’s the overall daily INTRADAY market direction.
When I get time, I’ll post the RSI 2.
SPY maintaining some kind of support here.
up against 1085…
a 50% retrace of the last move on SDS too…held perfectly
There’s a double bottom on SPY’s 15min stochastic. Normally, that preceeds a move up if MACD starts turning up.
usually…..not today my friend….lol
but I’m watching closely…
You’re right. It tried, but the red triplets got it.
not triplets yet, and not sure it will get there today. 1072 in my sights though!!!
SPY broke below the weekly gap support. Now to see if it fills the gap completely.
If SPY does fill its November 9th gap, there is yet another gap below that from November 5th down at 104.84.
thanks matt I remember that now that you say that….have we filed the NDX serial gaps??
see my first post today… dax showing positive divergence though
2thfixr,
The QQQQ has made a bounce from its November 9th gap just like SPY.
Matt
Well, the gap held, but it wasn’t pretty.
sold off most of my SDS, but went home with 500 shares. A nice day for me, hope the rest of you did well too.
K says:
January 29, 2010 at 11:18 am
bouncing right on the pivot. hmm will it hold? my indicators are now 3/3 to the down side (this is for intraday plays)
let’s see if we will drop a big 10 from here
HOW about that!!! I didn’t want so many TT’s at once. (T T looks like pi)
if Mitch is out there….my XOM puts $65 are finally in the green! WE;ll see how the earnings treat them before the bell on Monday.–not well I hope.
gotta run, I’ll check any comments tomorrow….adios and have a great weekend. Thanks for the help. This place is the best.
2thfixr, nice going.
This market is starting to look ugly, emphasis is to sell the rallys and pile on with the declines. Seems like market psychology has completely changed, buyers are no longer trusting the dips. Everyone says we get a bounce right about here before we proceed down – maybe that doesn’t happen and we just fall straight down.
US Dollar Index Broke Resistance!
http://theimpatienttrader.blogspot.com/2010/01/us-dollar-index-broke-resistance.html
Obama is 10th cousin of Scott Brown!! LOL
http://blogs.wsj.com/washwire/2010/01/29/all-in-the-family-obama-related-to-scott-brown/
Bank Closing Information – January 29, 2010
First Regional Bank, Los Angeles, CA
Community Bank & Trust, Cornelia, GA
Marshall Bank, Hallock, MN
Florida Community Bank, Immokalee, FL
First National Bank of Georgia, Carrollton, GA
BOOO YAH 5 more
just a pattern to get familiar with.
http://blog.afraidtotrade.com/perfect-bear-flag-example-intraday-spy-jan-29
Ah, the ‘fraid ta trade is right in my ball park with a 1 and 5min. That’s like a mini-bull trap.
add
American Marine Bank, Bainbridge Island, WA
WOOOT #6 of the week.
now i will sleep well.
K’s week is complete.
Thanks George for the kudos. You’ve been a big help to me, and I appreciate it. I enjoyed playing the scalping game with you today.
K, wow. you must be ecstatic with 6 closures! Sleep tight.
Randall, I’m with you. I “know” a bounce has got be in here pretty quickly based upon technicals and EWT, and my gut told me to dump all the SDS and buy a small SSO stake…but golly, this truck is really rolling downhill. I’d rather sit out some of the bounce, than jump in too early and get smashed like a bug on the windshield of this runaway market. Had enough of that getting into shorts in early November 09 thank you.
Plus, you can never be too careful overnight or a weekend holding positions for “expected” moves. I’ll jettison the 500 SDS Monday if we get above the 1077 high water bounce level made in the last hour. If disaster strikes, or the market continues to roll downhill, I’ve got a head start.
Nice to have you posting regularly Matt on Friday. Thanks for the heads up on the QQQQ/SPY bounce. I figured it would bounce, and I wanted to switch to the longs, but couldn’t jump in front of that truck. As a newbie, I figure I’ll let the market tell me what direction it wants to go before I commit to a trade.
A good read…webofdebt.com…
always good reads caseyresearch.com/displayCdd.php?id=332
Paula,
What a good read! I never realized the Oz movie was a “take off” on the financial system.
My, nothing has changed over the past decades. The fake baton is passed to each generation of politicians. I suppose they believe constituents can’t “handle the truth”.
K,
I was checking those bank failures with Money and Markets’ list. Interesting that several of them were closed on Tuesday.
hehe
oh by the way problem banks list is now at 599
i think we had 15 failures in total this january. which means 15*12= 180 banks could go belly up by christmas. of course if markets deteriorate i wouldn’t be surprised to see 250 failures but that’s bing on the extra bear side (just depends on who you talk to
)
http://www.businessinsider.com/henry-blodget-so-how-do-you-think-this-movie-will-end-2010-1
POW WOW!
http://jessescrossroadscafe.blogspot.com/2010/01/ny-fed-conspired-to-hide-details-of-aig.html
I know we know about this but nice read as well.
Gosh,
You guys and gals are going to increase my daily permanent links. No Fair!
Reminds me of my last employment where I had to review 200 email a day. At least now I enjoy it.
Keep it coming!
George,
over 160 permanent links but i dont have to check them all regularly for links.
I suggest you get used to google reader haha
here i check every few minutes but thats cause you all are a fine bunch. otherwise trivisonno would have just been another permanent link.
String, George, K, & Junglegirl,
Shoot for the moon. If you miss, you will
be among the stars.
Paula,
I like it. May I have permission to use that? I can think of several occasions.
K,
You told me about Google reader but I haven’t done it yet. Is it a resource hog? I’m afraid if I get too many active strings it will slow me down. SKYPE isn’t too bad but Google IM is noticable.
George,
Yes!
Paula, Thanks…