Stock-Market-Observations

MY CHARTS

WHAT’S HAPPENING?

05-03-12 SP FUTURES 30 MINUTE BARS

We could be in the last step down of the present decline.  This is based on 2 “possible” counts.

• From the Friday peak I can count 3 steps down into today’s close.  Of course there is no rally (yet) to terminate the third step, only a resting point into today’s close.  Tonight the futures are unwilling to do anything other than continue to trade sideways.  Europe’s open will probably provide some direction to the futures.  We’ll see later tonight.
• We are in 3rd step down “if”: step 1 down ended on 4/29 (followed by a higher high rally), step 2 down ended on 5/2 and 3rd step down is in progress.

Today’s decline stopped on one of the fan lines.  These fan lines have provided good resistance with the market bouncing at each of the lines.  To date, the decline is slightly less than 50% from the 4/2/12 bottom.

Looking at the chart below, a worst case scenario would say that we have completed 3 steps up since April 2nd.  1st step ended on 4/12, 2nd step ended on 4/17 (or 4/19), and 3rd step ended on 5/1.  In this scenario, we could go lower than 4/2 or 4/22.

You could also look for support on the lower yellow line, which is about 1377 presently.  A decline to that level would be about a 62% decline.

05-03-12 SP 500 FUTURES 45 MINUTE BARS

So which is it???

Jeffrey is still saying you can be cautious but don’t be bearish.  I’m not bearish and I’m only a little bit cautious.  I might want to buy again soon when things look more solid.

Hopefully there aren’t any errors in this update as I dashed it off rather quickly.  If there are, let me know and I’ll correct it.

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This entry was posted on May 3, 2012 at 8:40 PM and is filed under IN DEPTH, UPDATE. You can subscribe via RSS 2.0 feed to this post's comments. You can comment below, or link to this permanent URL from your own site.