Sawtooth Bottom Or Plunge – 08/10/11 © ™

  • Short Term
  • July 7, 2011 – Present
  • Step 2 Down Completed, Waiting For Step 3 With Buy Signal 
  • Action Status – Sold

Today the market was in plunge mode again but it didn’t take out yesterday’s lows.  Only one of the indexes that I watch had a new low today, banks.  The banks are being beaten savagely, just like 2008 and we aren’t going to have a meaningful rally while the banks are being beaten to death.

Looking back, the banks have done comparatively poorly since March 2009.  In the chart below, notice that the banks made their high in April 2010.  That’s really early considering most indexes peaked sometime between February 2011 and May 2011.  That’s a really sad performance.

BANKS DAILY BARS

08-10-11 BANKS DAILY BARS

We won’t know whether we’re in plunge mode again until tomorrow or later, but I would think we are in the process of forming a sawtooth bottom pattern.  After hours tonight the SP500 futures are up about 9 points.  That might not mean much tomorrow morning but at least they aren’t plunging overnight.

Since we didn’t have lower lows today, we can hope that the bottom of step 2 is in (or near) and we’re going to rally a bit.  But at the moment we haven’t broken the channel of step 2 down, so that means step 2 down is still in effect.  Regarding hope, “Hope is your worst enemy in the market”.

The following charts were taken from my personal charts (link below).  Each page has the same time frame and varies from 1 minute to monthly bars.  There are 8 pages of indexes, 3 pages of indicators and 13 pages of growth stocks.  The charts are there for you to use freely.

See my charts (updated constantly)

15 MINUTE CHARTS

08-10-11 15 MINUTE BARS

60 MINUTE CHARTS

08-10-11 60 MINUTE BARS

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