Price Time Volume Investing

Options expiration provided some volatility in the lower volume market this week. But price appears to be magnetized higher. I am looking at SPX 1440 (360+90 degrees off the March low). It doesn’t pay to get cute around these numbers as price may go to 1438 and reverse. Waiting for the exact number has cost me money on a number of occasions.

Long Term

The SP500 Index (SPX) Roadmap continues to function as a good tool. Price is a little extended from my original “guess” but has not reached my “guess” level yet. It has not paid me to trade with a fine tip pencil on these guesses in the past. This roadmap charts the time frames of the two previous Elliott Wave five wave cycles and has been a good predictor of future cycles.

Keep in mind this chart is dynamic and future readers should note the date when reading this post.

Short Term

SPX price has reached a 50% retrace of the Oct-Mar range. I believe it will move to the 1:1 descending Gann Angle around 1440. Price could continue above 1440 if the market players continue to short the top and are forced to cover a few days later.

Weekly Market Observations

• SPX closed at the highest point since the first week of January
• AAII bulls backed off and bears picked up this week - still are overall bullish which removes that positive
• SPX Commercial COTS are still slightly net long, but moving toward net flat
• Odd-lot shorting has been significantly reduced in the past few weeks
• Insiders continue to buy more than they sell
• The Nasdaq is stronger than the SPX and DOW

As always, I could be completely wrong.

Post Modified: July 3rd, 2008 at 12:28 am

Tags:   Dow Jones Industrial Average · Elliott Wave Analysis · Gann Angle Fan · Market Outlook · Nasdaq Charts · Roadmap · Standard and Poor's 500 (S&P500) · Volume2 Comments