Markets opened a bit lower and did have a VERY choppy day , up and down like nothing else with bad economic data out with consumer confidence extreme low.
Overall I expected today to be kinda flat today and choppy which I called in our room before opening www.nwatrading.com and we closed near flat with a very choppy day.
Guess what - SPX hit my UPSIDE target for this rally at 1220 which I had pointed out weeks ago - but the thing was that I just did not believe we would see a move to this level as my cycles charts told me that time was running out.... but oh my gosh , the high today was 1220.1 on SPX which is 0.1 penny from my target lol !! after we got to this markets plunged the last 10 min into close as big funds dumped imho and began to sell off in AH trading too.....
Well after my upside target reached I am gonna make a downside target for SPX which is around the lows we had at 1100-1120 area again. I think we are going to test those levels again in next weeks and in the case we break BELOW 1100 , we are going to get a bullish MACD divergence on the daily chart which is extreme bullish for markets in case we break below that level.
But for now , everything is just to SHORT the rips imho and I think extreme good chances that the rally finnished today - as my upside target of SPX got fulfilled at 1220.
We also have lots of possible bullish backtests on short ETF + we have a bearish rising wedge pattern on SPX 30min chart which could breakdown any day from now.
We have on 30min chart a very clear bearish divergence too... and with NYMO to extreme highs like we had in July top at (1355 SPX) we are same level on NYMO - everything then points for a big nice drop down..........
Conclusion: I remain in the bearish camp as I have been last days - and my average position in TZA is 43 now after adding in the 40's the last ones , having 30% of my whole account into shorts and rest in cash. Imho no reason to try pick a winner if you think markets is gonna go down.... just stay in cash + having lots of shorts.
TZA currently underwater as it closed around 40 , but I think in a few days from here ... this will be forgotten.
Overall downside target is at least 1120 on SPX and below - if we break 1100 this time , we could see 1070-1080 area imho.
Have a nice day ! :-)
Thanks again, Sqwii. You post today's update very early. Very appreciate. I expect your everyday update very much. I pick up some short today as well. However, I sometimes still confuse the time cycle between yours and SC's. In your plot, when the test of 1120 or even lower target will be hit? Will it go until 1st week of Sep? In, SC's newly post, he expect a bottom till the end of Aug (which is one day left) and then a rally to the 1st week of Sep.
ReplyDeleteMaybe the market is just very tricky. Thanks again.
Roger very true - no one has the same cycless and such - I see a bottom around mid September 1 week before the september meetings with ben bernanke.
ReplyDelete