Friday, April 29, 2011

Bullish Summer?

The market ended the month at a 3 year high and everything is bullish right now. I happen to own Gold and Chinese currency and that has been doing extremely well as well. So from the technical perspective, I think we should assume a continued rally possibly into the summer before any significant correction. From an EW view, there are several ways to count this wave in the intermediate term but from the short term perspective this can't go on much longer without at least some sort of drop. Indicators are all overbought, so it favors a pullback Monday. Also, there hasn't been a single rally where there were more than 4 white candle days in the last 8 months so that also favors a pullback Monday as well. I drew a channel on the chart where the market could find support in the event of a pullback and I will be going all long at that level. As of today, I sold the hedging position from yesterday at 1363 and I am net short.

And btw, the market almost reached the 1370 target I had for April. So I just have to extrapolate some of the data to get to a May target and I will post that Monday. Have a great weekend!

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