Note: I updated the charts for NDX and NYSE last night. I’ll post EURUSD, DJIA and RUT later today.
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Another day, another gap opening…
As we discussed late in the session yesterday, SPX was smacking into resistance on the 60-min RSI chart.
The futures are off big on more fears out of the eurozone and euro weakness.
But, I wouldn’t necessarily chase the downside here. For those who shorted on the close yesterday, I’d take profits at around 1550-1551.
UPDATE: 9:45 AM
SPX bounced at 1551.90, good enough for me.
But, keep an eye on the 15-min RSI. This TL should be a good guide. It was slightly broken a few minutes ago, but the bounce off of 1551.90 brought it back in line.
Stops around 1550 ought to do it for a long position here. Thankfully for the bulls, the NAR reports pending home sales at 10:00AM. I can’t remember the last time the world’s most optimistic economists delivered bad news.
UPDATE: 10:05 AM
Pending home sales were off 0.4% from last month (versus Briefing.com’s +2.0% estimate), but up 8.4% from Feb 2012. The slowdown is being blamed on lack of inventory and capital for builders. The market is hanging in there so far, so I guess we’re focusing on the 8.4% number….
UPDATE: 10:25 AM
EURUSD should get at least a bounce here, lending support to a last spurt for SPX. Note it has reached the .886 retracement of the run up from Nov-Feb (1.266 to 1.3710.)
UPDATE: 11:55 AM
The 1551.90 low held nicely, and SPX is off only a little over 3 points at present. We should get a little pullback here, as we’ve reached the .786 retracement from yesterday’s high (small white pattern.)
Just noticed that each of the recent bottoms, when taken as the starting point of a measured move, points to the same place: 1566-1569. A measured move is essentially an A-B-C move where the C wave is the same as the A wave.
In most cases, the B wave is a Fibonacci retracement of the A wave (.382, .500, .618, etc.) In a wildly gyrating market such as we’ve had since Mar 15, the retracements run bigger (.786 and .886.)
UPDATE: 3:30 PM
SPX continues to go our way, could turn positive any minute. Will it finally push through today, or is this another fake out?
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