Wednesday, September 22, 2010

9/22/10 - EOD UPDATE#2

60 MIN
I'm just posting some additional thoughts on what I see. I have drawn three parallel lines (blue) that appear to have contained the market action thus far.

On the chart above, MACD is sporting a negative divergence and given that I have the count complete for minuette (i), it stands to reason this negative divergence is indicating that minuette (ii) is in progress.

Guess where the 50 SMA sits? 1129.40 to be exact. That also lines up with the middle trendline. Will the market find support here or does she break through? See below should 1130 fall.

DAILY
Here we zoom out to the daily view and a few things standout as well. I show a MACD that is trending postively, the 50 SMA at 1097 and the 50% retracement of the rally right around 1094.

At this degree, it makes sense that a minuette (ii) would pullback towards the 50 SMA and a 50% retracement. It also would fall on that bottom trendline.

If the daily MACD trendline is intact, I believe it would provide support again at the end of minuette (ii).
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