The recent top of the monthly chart is at the mid-range of the 2002-2007 bull market. I noted before that it was odd that the market topped without hitting any significant angles. Maybe this is the resistance that stopped price, but I also would not be surprised to see another push higher. After the drop and recovery on Friday, maybe the bulls will all jump in at once and cause a blowoff top. The volume shows no distribution in the monthly time frame but the weekly and daily do show some.
Price is very near the 50% retrace of the 2007-2009 bear market. A pop up to the 50% level would not surprise me. The 50/50 point does not high for several months. This point will be a good gauge of the market. A close below this point at the 50% time cycle would point to continued lower prices throughout the remainder of this time cycle.
The daily chart shows price at the 50dma and the 1×1 parallel ascending angle which should provide support for at least one more run at the high. Of course, if price drops like a rock through this support then this would signal a lack of support of institutional buyers at these levels.
Charts courtesy of Stockcharts.com
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Tags: Gann Angle Fan3 Comments
Looks like the July gap is calling. I counted 3 trend lines broken since March Lows, I counted 3 lower highs on 20 DMA of NAAD, 9/23 looks like buying climax, I counted 3 higher lows on 10 DMA of CPC, I read distribubtion on the QQQQs since 9/17, I saw the high probablity Candle trend reversal on all indexes 9/23-9/25. Oct 1 was 144th trading day on Nasdaq after March 9th low. MACDs trend line since November 2008 on most indexes are broken. Greed fever is running high and people are feeling cozy again about their stock and 401K accounts, I guess just what a market requires for a turn.
Odds are very very high the IT trend has changed. Next IT stop looks to be the July gaps which are all around 38% retrace since March lows. I see a bottoming around early-mid Decemeber. Al this to be re-evaluated on weekly basis.
The bullish case: I really have none .. and that’s why I like and appreciate Andy’s view point. It covers my blind side
Andy/Libby, Here’s something I have been thinking about …I saw data once suggesting that the real GDP growth in the boom years from 2003-2007 would have been about 35% less without people using their homes as ATMs .. So now we know those ATMs are gone for several years … we also know we have 10% employment and not getting lower .. + wage decreases, so my question is where will the juice come from for this so called new bull market that we are in? So if the stock market is a leading indicator (as Joe Public even knows that now) then how much ahead is it leading? Because spending from people in US will not be back to levels of even 2001 (recession year) anytime soon.
So in my view (until I learn a new lesson) this is a “bull crap” bull market that will not last too long. It either finished or will finish by March 2010 if DOW can make it to 10K or even 11k by then.