Last week closed definitely bearish. Broke below the SPX channel I have been showing here for a while. As I mentioned last week - we were and still are very crashy looking. I still say be careful out there. But I will be looking for low this week sometime - most likely on Monday or Tuesday. But let us take it one day at a time.
Here is the broken channel.
As you can see, we were in this channel for 2 years almost and now have broken down. The bearish implications are very clear here. Even this low I am expecting this week, we will probably have a very good bounce from it that wont go to new highs.
What I am trying to say is the longer term trend is now bearish irrespective of what market does in short term. In elliot wave terms, we likely will finish A wave of a bigger ABC sometime this week and then set about a counter trend B wave which may last into November maybe December. This sets up a C wave later. But one step at a time.
Looking at internals - we are very oversold. And several indicators are at an area where the market has bottomed before.
Be careful for the next 2 days. Still crashy. But I am looking for a low to setup soon. I dont have any positional positions as on now on stocks. Still have on the NUGT puts - I am not very sure what to do with this but I dont think the low is there yet. It will be interesting to see what it does this week. I will be trading ES intraday tomorrow - these fast moves make for good in and out trading. I will be looking for a low which should be of atleast 10 week low magnitude - if things start to look good, I will be setting some bullish to slightly neutral positions via options - this will be a fly and a bull spread. Tentative for now. Lets see how tomorrow goes. I think we look really bad in the morning which recovers by end of day - Just a guess! :)
Best,
PM
Here is the broken channel.
As you can see, we were in this channel for 2 years almost and now have broken down. The bearish implications are very clear here. Even this low I am expecting this week, we will probably have a very good bounce from it that wont go to new highs.
What I am trying to say is the longer term trend is now bearish irrespective of what market does in short term. In elliot wave terms, we likely will finish A wave of a bigger ABC sometime this week and then set about a counter trend B wave which may last into November maybe December. This sets up a C wave later. But one step at a time.
Looking at internals - we are very oversold. And several indicators are at an area where the market has bottomed before.
Be careful for the next 2 days. Still crashy. But I am looking for a low to setup soon. I dont have any positional positions as on now on stocks. Still have on the NUGT puts - I am not very sure what to do with this but I dont think the low is there yet. It will be interesting to see what it does this week. I will be trading ES intraday tomorrow - these fast moves make for good in and out trading. I will be looking for a low which should be of atleast 10 week low magnitude - if things start to look good, I will be setting some bullish to slightly neutral positions via options - this will be a fly and a bull spread. Tentative for now. Lets see how tomorrow goes. I think we look really bad in the morning which recovers by end of day - Just a guess! :)
Best,
PM
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