It looks like SPX may target 1160 level on this astonishing bear-trapping run. I am looking for 50% fib pullback after that, as a possible entry level. Since I think that lows are in for the year, I will be buying all pullbacks in the next few months. If 50% gives way, next support would be at 61.8% Way too many traders woke up and will be buying pullbacks, so we probably will not get there. Wait for the top of this move first, before putting a fib on it. I will update here...
EUR/USD is having a field day hunting for bear as well. Trichet is pulling all the stops on liquidity measures. It has been an interesting presser and he is still speaking to reporters afterwards - his term expires at the end of Oct. EUR/USD has reached my first target @ 1.3430 http://technorati.com/business/finance/article/euro-bear-market-rally/ One should trail the stop to break-even.
Please note that I still think that both SPX and EUR/USD are in a bear market. But nothing travels in a straight line. We are witnessing markets at work, punishing the conplacent traders, and returning the price back to reward the patient ones with a better entry. Lower, much lower prices are still yet to come, imho. Just not now...
Update: Oct 6 @ 4:05 pm edt
SPX retraced 61.8% of 9/16 - 10/4 move. I expect a quick pullback from this level. Looking for 1120 and 1110 levels.
"Lower, much lower prices are still yet to come, imho. Just not now..."
ReplyDeleteSame next year? or 2013? I think the latter.
Thanks. Zen
SPX rallies for few months, then resumes downtrend. We are heading into recession next year. New lows in Jan - Feb 2012, imho.
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