UPDATE: 3:50 PM
SPX bouncing on the non-news of Greece, etc. Should be limited to the .786 of Friday’s Bat pattern at around 1210.50.
ORIGINAL POST: 2:45 PM
Friday’s Bat patterns are playing out nicely, with SPX down to within .45 of its .618 Fib level before getting a good bounce at the 10-day moving average.
A Bat pattern target is normally .618 of the DA retrace, meaning just below 1170. The pattern .382 level at 1168.14 correlates nicely with the larger (since May 2 high) .236 Fib retrace at 1166. I’m thinking it’s a reasonable level at which to rebound to the channel line one last time a la July 21.
Don’t expect a straight line, though, as Fed mania and stick save Euro zone conference calls will provide plenty of upside impetus. A good target for today’s rebound: the .382 Fib level (from the May 2 high) at 1205.1.
BTW, I normally don’t pay much attention to individual stocks, but a bellwether like AAPL is hard to ignore. Recall it recently completed a Gartley pattern at 392.08. Here’s the chart I posted on Aug 31.
Along with the Gartley on SPX, a neckline backtest on COMP and SMA 200 on NDX, it helped convince me to call 1230 the interim high.
We got a nice reversal almost immediately, retracing 26 points (.618) in the following three days. Now, it’s back with a vengeance, hitting an all-time high of 411.82 just minutes ago.
Of course, in the process, it completed another bearish Crab pattern. Crabapples, if you will.
It’s actually overshot the 1.618 ideal D point of 407.90. So, the pattern could be busted. Or, it could be it just got a little ahead of itself.
But, looking at the long term picture, there’s a rising wedge that’s clearly coming to a head. If so, AAPL could end up spoiling the whole barrel.
More after the close.
ADDENDUM: 3:30 PM
Take a peek at the divergence on AAPL’s weekly chart. Does the RSI have the juice to break through the TL?