For anyone experiencing a slow response from the site this morning, it’s not you. GoDaddy is on the case, and I hope to have some resolution soon. I sent out the first update via email rather than wait forever for page loads. Please take this opportunity to subscribe to twitter — another back up available to us: https://twitter.com/pebblewriter .
Also, a quick shout-out to a member of this site who, without knowing, has made life more bearable for me of late. Only 100 feet from where I sit overlooking the beautiful Pacific, someone has been preparing a lot for their new house. For the past three weeks straight, a 20-ton excavator has been jack-hammering solid granite from 8am to 4pm.
While slowly going (even more) nuts, I discovered the music of David Parkhurst Crane [website]. It’s both uplifting and serene, and gently guides me back to a saner place. An added bonus: it’s instrumental. So, I don’t get distracted (or add to the excavator’s din) by trying to sing along. Thanks, David, and I hope I haven’t embarrassed you too much.
ORIGINAL POST:
This morning, everything is still on track. We’re getting the bounce at 1400 we anticipated in yesterday’s post [see: Without a Net.] We haven’t had a significant bounce yet since shorting Monday at 1423 [see: At Last.]
The key to any additional upside will be if SPX leaves the little white channel established since the top. The top of the channel is currently around 1408-1409. A bounce should be limited to 1420.82 or so, the .886 of the move down thus far, and the top of the purple channel that’s guiding the downside in the big picture.
If it ramps up but reverses at 1409, then obviously the downside will accelerate.
The 60-min RSI supports the idea of a decent bounce here. Note we’ve reached the bottom of the yellow channel.
UPDATE: 12:05 PM
We broke out of the white channel and are working our way back up. A typical .618 retrace would stop at 1413.99. But, there’s a potential channel widening (small red channel) to be had at the .786 at 1418.27 (it would have to hurry) or the .707 at 1416.26 late in the session.
At some point during every sell-off, the falling channel has to widen or morph into something else. We won’t know exactly which until this bounce completes and we resume the downside.
For those looking to capture the larger move, no reason to chase the bounce; it’s likely nothing more than a blip on the way much lower.
UPDATE: 2:55 PM
The site seems to humming along again. The bump got as high as 1415.56 and, since then, has been furiously — well, pretty much nothing. The two possibilities I ventured this morning are still on the table. A tag of the purple channel would mean about 1420 as of 3:00PM (the .886 is at 1420.86.) The red channel I drew is presently up around the .707 at 1416.26.
SPX has formed a pennant-looking pattern which hints at 1428ish. While I definitely don’t expect it to play out, this is why we use stops.
The 30-min RSI is mashed up against a channel line, so it could break either way.
But, the longer-term picture is still negative — and should remain so as our forecast continues to play out.
continued for members…
Sorry, this content is for members only.Click here to get access.
Already a member? Login below… |