Thursday, October 29, 2009

10/29 - SPX Pre-Market UPDATE


GDP numbers came in higher than expected. I'm no economist but wasn't there talk about an inflated number due to cash-for-clunkers and what not?

It doesn't matter to me at this point. The only thing I'll be watching to see if we continue heading lower are these two charts.

The first chart was posted on Tuesday. Price pulled back to the lower purple trendline as anticipated based on past behavior (see post on this)

Now I'll be watching to see how high the daily histogram prints after today. Yes this may be a little late for day trading today (sorry folks, not a day trader) but it may provide us with a little heads up as to where we may be heading in the next week or two. Besides, a nice trade was made from 1079 til yesterday's 1042 low.

The second chart could potentially give us an earlier heads up that the move lower over the past week is complete if price takes out 1074.31. This would result in a 4-1 overlap.

Of course that assumes the entire count since the move lower is correct. That is why I'll be keeping an eye on the daily histograms as well.

I still believe 1060 will hold to complete a minuette (iv) and at worse just shy of 1074.



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