As we are currently hostage of one man’s speech, I would like to make some important reminders of some the things I have written lately. On July 26, I wrote the following paragraph.
“We did hold the 50MA, now bulls just need to step in and take control again. I am not trying to call the bottom in any way, I am just sharing my view of the market as I see them on my charts. Keep in mind that even if the bulls step in, the general idea will still be of negativity. But by the time people see the light, it will already be too late, and then we sell again. And when I say we sell again, I mean in May 2013.“
We actually did run up to new highs until one day on August 21st, when we gapped up huge and started to give everything back as I describe on these two paragraphs.
“$SPY opened strong, and kept going until it reached it’s intra-day R3 @ 143.04 and change. At that same time, $IWM also hit it’s R3 @ 82.46, and everything pulled back. Currently the $IWM bounced off on R3, but I don’t think it will last too long.
In any day of the past 2 weeks, the market has reached R3, and when it did (sometime during the day) it dropped hard. From previous instances, when market pop to R3 before 11am, it has sold . I just wondering if this time the market will do the same, since there are a lot of people still buying any dips they see.“
What I am trying to make readers understand is that, as I look on my charts, I see nothing in the technical levels of the $SPY, $IWM, and a combination of the $NYMO (McClellan Oscillator) that can make us fail from here. So far we did everything I have been expecting. We had bottom, we ran up. While we were running up, I mentioned that at some point we would have to sell to give money managers an opportunity to reload on positions. We had that pull-back. Currently many stock names I currently follow pulled back to levels that money managers feel comfortable adding to their positions.
I find it very unlikely that the fed will say something to upset the market. He will certainly upset everyone who is looking for QE3. It is easy money in the short term, but a big mistake going forward. It is just someone kicking that can again. The best approach is to make sure that investors across the globe see that we have a long term plan to their current economic problems. Places like Europe, China, Japan, and sooner or later Brazil.
I hope I am making myself clear here. if not maybe I am just being naive, or I am completely insane thinking that the fed will say the right things to liberate us from this hostage situation.
$SPY 1st support is 140.28, 2nd support 139.84, and 3rd is 139.31.
$SPY 1st target is 141.12 , 2nd is 141.56 3rd is 142.26, and 4th one just for fun is 142.71.
Trade what you see not what you think.
