Thursday, August 29, 2013

Corrective bounce

The market rallied somewhat early morning following the 2 possible counts from yesterday and the reversal later in the day implies an ABC pattern, so the micro 5 wave count is off. However, there is a possible bullish nested 1-2 but I think it's best to be cautious here as two of the trends are in red. Should the market put in another bearish leg the number to watch is 1626, also the base where the rally started last month was 1620-25 so that level might offer a good opportunity to go long if it holds. I ended up selling Google for a profit in case we had an ABC in the morning, which is what ended up happening. So I will be buying back Google at support or shorting through VXX at the test of the resistance near the 50 day ma. But for now, I am cash on my short term portfolio.

Main S&P 500 Trends*

Short Term Trend = Bearish
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.

No comments:

Post a Comment