Saturday, October 22, 2011

Weekend Thoughts

I will be presenting several charts supporting both the bullish and bearish case. This is a work in progress over the weekend so check back later for more charts, especially the bearish one (assuming I can find more!)

THE BULL CASE
2010 Replay v2
Added the 200 day SMA. Perhaps that is where leg A completes first. 


2010 Replay?


The labels are not wave labels but used for reference. So the question remains is the market working on completing leg A and then a pullback B to come? Or has the market completed the MA backtest  at C and is set to trend higher?

The former scenario would make sense to form a better proportioned inverted head and shoulders bottom. Let's see what plays out.

So though this may favor a bearish view near term, it has a longer term bullish view and until a cross down occurs, it should remain as a bullish view.

 One thing to note is that it would be obvious to expect a pullback to form a right shoulder of an inverted head and shoulders pattern so perhaps the market does not give one a chance to get in on the ride.

10 Year - Fibonacci
Interesting how the market has respected the various Fibonacci levels through out the 2008 decline and from the 2009 rally. Perhaps a re-test of 1370 is in store should 1228 hold.

The weekly MACD buy signal that trigger at the end of the week may be alluding to this move.

3 Push Pattern?
Weekly 'W' Bottom?
A MACD buy signal and a close above the 20 week SMA. To confirm the next week or two should see a decent sized rally.

NYA Breadth Thrust
Refer back to this post for an explanation on this.

Weekly 13 EMA and 80 SMA
The market cleared both.
Fibonacci Fans
The market finally cleared the 61.8% yellow Fib Fan.
THE BEAR CASE

2008 Replay?
50/200 MONTHLY SMA
The MACD LT TL squashed the latest rally so far and remains in a confirmed sell signal. However, for a bullish argument, price backtested the blue TL and bounced very rapidly.

Will need to keep an eye on the MACD TL. If it breaks up and through,  this chart will be placed on the bull side.

3-Push 
This is a near term view so not necessarily bearish on the longer term.
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