Thursday, January 12, 2006
If tommorow closes in red, the scenario could change completely, which would kick the daily momentum to a sell and a retest of the 1/3/06 lows will be in order. So i will be watching tommorows action closely to get more clues.
Both Euro and YM had great day trading opportunities today, with virtually no exit for shorts
Wednesday, January 11, 2006
There's a cluster of resistances between 1290-1300, which is unlikely to be taken out in the first attempt. So a reaction is very likely here. The markets have been moving up in a corrective advance the last few days. When the market is moving up in a corrective fashion and making new highs, it means that there's so much bullish pressure that the correction is happening to the upside instead of to the downside, which is called a running correction in e-wave terms. The strong breadth behind the move also confirms the running correction thesis. Based on the strong internals behind the advance, this leg-up is likely to continue for weeks instead of days. If SPX 1300 gets taken out, then SPX 1335 will come in a flash.
I am expecting a 1-2 day scary correction here, which will weaken the bulls resolve and bring out some mega bear warnings from the usual suspects. Then a move higher to fade both the weak bulls and aggresive bears. Same Old .. Same Old !