As with all the pickers & predicters on SI, I've found none that predict exact bottoms or tops. Constant adjustments in TA must be made to reflect changing conditions and support/resistance adjustments must be made in accordance with trendlines... especially when predicting market moves.
And here's what I see from a TA perspective and from a logical one, based on market psychology:
Resistance of a trendline at 2925 was broken this a.m. and the next resistance line was hit today. If we can break through 1950, the next resistance would be 1980.
It ain't happening yet, imo.
First, we still have to go back and test 1800. Unlike others, I believe 1800 will hold.
Jonathan Joseph made his famous call in July 2000, but we peaked about 4-5 weeks later, on 9/1. Yesterday, he made a critical comment on INTC and today he upgrades it? IMO, he just lost a little hard-earned credibility for that. But I won't dismiss him totally.
Today & tomorrow, shorting may be the best general policy to follow. But knowing the # of shorts can still help longs pick out a few candidates to go long on, briefly. As I write, FNSR is still hitting hods, for example.
But it is possible to see us retest 1800 today. If we hit that and break it, 1786 is the key intraday mark today. Breaking that spells serious trouble.
More probable: It is quite possible that 1850 will hold today, however. If so, expect the retest of 1800 first thing in the a.m. (TA supports this). A break of 1794 would spell trouble if this pans out.... and I believe this retest scenario is the most likely, based on all current conditions.
But even if we break that serious trouble line, I think we'll find strong strong support at 1685.
And if we get renewed bullish behavior, we'll simply retest 1950 tomorrow.
The critical test will come Monday. With a double test of 1950, even a breakthrough there means a stronger resistance at 1975 lies ahead. Viewing who reports Wed & Thurs next week, I'd say the odds are decent we can break that 1975 point.... but I ain't betting the farm on it.
Personally, I'd rather retest the low first. So many stocks have run up 50% or better that even decent earnings appproaching can't provide much oomph.
Intuition suggests this as the MOST probable: two tests of 1950 and perhaps 1975-2000. But we won't break 2000. This will be followed by a drop to 1825, at minimum, probably by Tuesday. Next Wednesday will be the critical test then. At this time, I can't predict what will happen then. Intuition says we will, indeed, retest the very bottom of 1619.58 by Friday next week or Monday after.
Thus, next week is the dangerous week for longs. I will go against some excellent market callers however, and predict that we'll not break the bottom yet.... unless we fail to break through 1975 this week. Even then, any new bottom will be curtailed between 1460-1594.
I am not ruling out fresh bottoms later this year, but 1460 or 1619.58 is the worst I expect to see before a peak in mid-to-late June. I still say the final bottom of this bear comes in late Sept to early October.
Despite my blabbery, I'm not applying for guruhood. I just wanted to add my two cents to the mix. Next week will likely be the last time for awhile that shorts can rule. Afterward, the market will be day-to-day with neither bull nor bear likely to dominate longer than 3 days... till July, when the bears will regain the upper hand.
It becomes critically important to understand valuations by then. And I think, if you are a bull, looking for value among the small and microcaps from July-Sept (such as Hoffy has recently done with ALLY and MEOH) will be the way to go.... because the glamorous stocks we've all enjoyed will go down.... or take that quarter off and return when stability has resumed in October. |
