Most Often If We Look Where We’ve Been We’ll Know Where Were Going?

Posted by Finance Professional on July 14, 2009 under Stock Market News | Be the First to Comment

“Most Often If We Look Where We’ve Been We’ll Know Where Were Going?trading

By PlayBIG!
Wednesday July 08, 2009 (@03:57am.edt.>)

Good Morning Stock Fans!

As in life it is the same in trading and the markets.

“If We Look Where We’ve Been. We’ll Know Where Were Going?”

So, let’s look at where the S&P 500 ($SPX) has been since we looked at it on the chart below:
Notice this chart that I posted on June 25, 2009 on the S&P 500 ($SPX)charts

With this heading:
Thursday June 25, 2009@01:20pm.edt.>) “S&P 500 ($SPX) Intraday Rallys Off Of Its 200 DMA To 920+! Is It To Set Up 866???…”
Now, as we know now that is ALMOST exactly what the result has been thus far over the past week as the SPX, has fallen off of 930+ to see 879.93 yesterday before closing just off that low at 881.03-17.69 as it again fell today over 1% (-1.97%)
So, it finds itself now 15.03 over 866 as it sets up shop today.

Now, let’s look at that same chart again…
Except ofcourse updated to show all the action up till yesterday Tuesday July 07, 2009.close.

SPX.DAILY.07.07.09.close:chart

Now, notice I didn’t add any notations to it.
But, look at it .. do you see what I see?
The line my “cross-trend” that used to be at 870-866 line. on the chart above this one. Is now pointing where? 845.62 almost exactly if I extend it!

Now. what does this mean?
Well, it most likely means that the SPX, is ready to make a small bounce, and now that it’s taken out it’s 200 DMA for the 2nd time in as many months. It recovered the first time and went to see 931.92 (setting up that H&S I talked about. (Now however the pattern is bigger with the Left Shoulder spanning much longer in May 09 as the chart shows, and then the Head spanning the early part of June 2009, and finally the Right Shoulder spanning the last part of June 09. when it lost it’s 200 DMA of 917.20 in mid June 2009 it went on as i said to achive the top part of that shoulder at 931.92.

What’s key to this is simply this!
Look at the 200 DMA. see how the former low of 888.86 was NOT HELD YESTERDAY (Tuesday July 07, 2009) !!!!
That’s huge, But 878. 94 was held!
So, what we most likely can deduct from this is the loss of 888.86 today intraday and on close is that the SPX, 200 DMA will now act as MASSIVE RESISTANCE!
But, for now 866.00 should hold!

If the BEARS do take out 878.94 today they most likely will cover and short one final time for the drop to my predicted 806.11 before the front month contract JUL-17-09.

More to come…