Saturday, June 18, 2011

I extended that lower trendline for the wedge using the lowest three lows, which so happens to touch the 5/5 low.

I haven't posted this Fib fan chart in a while. It has fallen out of the blue fan but looks like the yellow fan may be relevant along with the 1257 support area.

I really like this channel. Even if the wave count there is not correct, the bottom line is this channel may be very relevant as well as that mid channel.

The channel is drawn using the tops of waves 1 and 3 and a parallel one drawn at the end of 2. Notice how the price has respected the mid channel as support and resistance throughout the rally.

Just a few simple things I'll be watching should the market find a reason to rally in the next week or two.

1. The daily MACD trendline and histograms. Should it break up and through, perhaps another move like the on back in March.
2. Daily MACD appears to be forming a +ve divergence on this chart. I'll need to verify this since I do not see this on StrategyDesk.
3. 20 day SMA at 1299 and the 1292 pivot.

Given that my primary 60 min count is looking for a wave 3 up of what may be the beginning of Minor 5, this may be move that will push the MACD through it's descending trendline. Obviously we'll have to see if it breaks through or is rejected.
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