INDEX UPDATE
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The only index that looks like it still has some technical strength is the DOW, and still has a chance, although slight to set new highs. All the other indexes look weak on a technical basis.
SPX - right now at 20 DMA and trangulating still, support at 1103,1094
OEX - now at 20 DMA & trangulating, has confirmed evening star reversal, supports at 534, 529
NAZ - slightly below 20 DMA, triangulating, supports @ 1839, 1832
XAL - This baby is really weak. The 20 DMA crossed the 50 DMA to the downside last Monday. Support @ 706. Evidend downtrend
DRG - right now at 20 DMA
BKX - Right now it is only 5 points above the 50 DMA of 848, and already below 20 DMA
SOX - Just became a CLASS 2 BUY (wont touch this baby to the upside 0 but the short-term technicals already low. The 20 DMA is only 3 point above the 50 DMA and coming down. Could intersect within days. Chats do not look good at all
OSX - is a CLASS 1 BUY and is showing strength. Presume it has been coming down in light of CRUDE dropping in price over the last week, although slightly.
YTK - 20 DMA just crossed the 50 DMA to the downside.
Overall the short-term technicals for the overall market is in the mid to lower-midrange, with the bias to the downside.
I recalculated and the this downtrend on purely a technical basis should last 2-3 more days, not 1-2, which would then put the bottom of this down cycle around TUE/WED, with reversal to happen WED/THUR. However we are all aware that GREENSPAN is on for TUE and almost the majority is expecting this market to pop right after the announcement.
Boy, it will really shock the BULLS a bit if it still continued down after the GREENSPAN announcement, but that could never happen. ggggggggg
I will not underestimate the upside momentum of this market, although it is weakening, so if/when the DOW gets to 9000 or below on MON/TUE (intraday at least) I will initiate CALLS, but will not close out of my PUTS; thereby creating a STRANGLE (legging in at different times). Im not 100% convinced that we will soar right after GREENSPAN on TUE, but I will also not underestimate that possibility.
I do believe that there will be a strong pop to the upside, but just not sure as many are that it will happen immediately after the GREENSPAN announcement, it may take an extra day.
I am still sticking to my downside target for this specific short-term pullback at 8950-9000, and that the following short-term uptrend will take us to the 9200-9300 range on the DOW, topping out around MAY 25-27, and a bigger pullback to start around that same period that could take us to 8750 on the DOW.
Feel that it is now safe to sell the rallies.
Have a nice weekend.
Seeya |
