Tuesday, November 5, 2013

Break out coming?

The market gapped down in the morning today but it failed to put in a lower low and instead put in the right shoulder for the IHS I wrote about yesterday. Obviously this pattern can fail but looking at the number of successful IHS this year, odds favor a break out as soon as tomorrow and the target is 1785 as I mentioned yesterday. However, looking at the micro waves I have 1790-1800 as a target so don't be surprised if we get another all time high this week.

I sold the VXX hedge given the bullish pattern so will be buying back if the pattern plays out as expected as that should complete the entire structure from 1646.

Short Term Trend = Bullish
Medium Term Trend = Bullish
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. 

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