So, despite the negative economic news, we still gapped up significantly but sold off immediately ("sell the news"). Then we drifted down and hit support at 940 (SPX) at the gap's opening, then gave off a reactionary rally, and finally dropped down to yesterday's close (aka the highly-reliable WTF pattern). That proved to be enough support as we formed an inverse head and shoulders (or the bat formation) and rallied as close as we could to this morning's high before breaking down. We again found support at this morning's gap opening and was just about to breakdown until..."WTF" showed up again in the last 10 minutes of trading.
We're in a long consolidation range and don't seem to be going anywhere, but on the 3-day chart, we formed what looks like a cup with handle pattern. The 6-month chart shows that we're still not comfortably out of bear territory and that we're still testing the 20-day MA. Even though volume is light, it is now obivous and clear that program trading from the guys with some big dough are responsible for the swings. What else could you expect from a market that is not as liquid as before?
S&P 500 1-day
S&P 500 3-day
S&P 500 10-day
3 comments:
hi, any interest in exchanging blog roll links with a PR5 blog? if yes, leave your blog url as a comment at:
http://bigmoneylist.blogspot.com
i'll link to you first, then when you have time, link back. :)
First, love your site! Second, Interested by your comment about a cup and handle on the S&P, because I was looking at the 10 day QQQQ today and thought I saw the same pattern.
Thanks! A lot are either forming a double bottom (possible), Adam-Eve bottom, ascending/descending/symmetrical triangles, ranges, bullish wedges, etc. All sorts of stuff.
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