Thursday, December 8, 2011

More Downside

So finally we get a clearer picture of where the market is going. And now I can put some labels on the waves and predict the next move with more certainty. So far I was right on a lower low in the upper 1100's, on where the market would bottom and where the top would be likely so let's see if I can keep the streak going. The odds of me guessing all these moves are minuscule (1/1000's) so I might be very wrong on my next guess but we shall see :) I think the market is doing a double ziz zag from the top of Wave 1 or A and we should see some sort of bounce or sideways trading before going into a proper Fib retracement area. The level I think will provide the bottom will be the 50 day ma which will probably be around 1220 and this level holding is a must for the rest of the rally to continue. Today the TA is at 1237 so the market closed below it and another close tomorrow signals a change of trend. So the plan is to stay put and load up on margin long at the 50 day ma.. once we test that level, I think we will see a rally to 1300+, perhaps even 1400.

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