The CRB index is very near a huge resistance in a huge channel down pattern.
The sentiment on the NASDAQ is still very high and the RSI(14) on the daily chart is above 80. Thats unsuistainabe and wont last, at least not regarding to the history which havent been above 80 RSI(14) more than very few days and after that usually a big decline. Question is now - do we get a pullback before higher or do we get a crash move down? What I like to see is there is a lot more concerns about EU debt crisis again , now QEII news is priced in. Also there could happend some dangerous things, terrorism is heating up around the world. ABK filling for bankruptcy and lots of the financial institutions are bankrupt. But again we should just look at what the price is telling us.
Here is a chart by Daneric, which is the short term bullish count.
This shows that if we wont accelerate to the downside soon, we could most likely pullback before going higher in wave 5 up.
Again its hard to say and elliott wave dosent work without simple technical indicators. We could also be looking for start of wave 3 down now and wave 2 is finnished. The NASI is still on sell signal which indicate no matter what there is a very good chance that over next 1-4 weeks markets should fall.
Here is a chart of Russel by ETF Corner
This chart looks good and IWM are near big resistance here. I expect huge decline from around this level. TZA = 3 x bear IWM.. so thats a good choice to go with. I'm already in a lot and stuck, but can be patience and wait the sharp sell off out. So IWM around 73-75 level is a huge resistance and should hold this rally. Until now its stoppped moving up.
Also insiders selling still like never before and COT smart traders are short markets. I dont trust the markets and think we are about to see a nice crash (still). I have been way too early, but again would you like to buy here ? No way also when Euro debt crisis is beginning again could make the euro fall huge and the dollar take off...
The SPY is still at 61.8% fib retracement and should sell off from this level. Thanks to ETF corner with chart.
All in all lets see what today brings. Might be a gap down and rally to 1232-1237 area and then we get our crash or we just crash from here.
Have a nice day
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ReplyDeleteI say no crash. No reason / catalyst for that. Only 3-4% pullback to S&P 1190 possible. That may be the last chance to sell TZA and all other inverse ETFs. Good luck.
ReplyDeleteThe debt crisis with EU is a good reason for a major crash. And again - if we knew the reason for a crash that would already be priced in. So a catalyst will come which should shock the markets.
ReplyDeleteGood luck Sqwii, but you got to watch this. "Why the Bears are Wrong" http://www.youtube.com/user/oldschoolchartist#p/u/27/oxxxjLVtA-k
ReplyDeleteHe has been right. Check his other videos too.