If you would like an email sent to you when I update the blog please send an email with "subscribe" in the subject line to traderbob58@gmail.com. To be removed use "unsubscribe".

Search This Blog or Web

Thursday, October 25, 2012

Daily update 10/25

Yet another test of the low.  SPX tested slightly lower each day, but failed to break down.  Here is the daily chart.

Today was an outside day with an up close.  That looks like a bullish candle pattern to me.  We are certainly oversold enough to support a bounce.  I usually use the 18 SMA for a target with a setup like this.  It will often overshoot it just a bit.  Lets zoom in to the 60 minute SSO chart.

We ended the day right at the 18 SMA which has flattened out.  The double bottom from yesterday has now morphed into a triple bottom.  Will the bulls gather the troops for a bounce?  This chart is in a very good position now to turn up.  If the bulls show up again tomorrow, go with it.  Remember the sub intermediate trend is down so the odds favor any bounce here will be of the dead cat variety.  That means if you decide to play it, do not overstay your welcome.  We should end up with a lower high that will be a good short op.

If we don't get the bounce, we still have support at the 1395 area.  I think the bounce is the higher odds outcome at the moment.


No comments:


The information in this blog is provided for educational purposes only and is not to be construed as investment advice.