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There is our wedgy chart above in all her glory. For those of you that read this blog every night and watch the Sunday video, you know this chart has been my focus for abut five weeks now, maybe longer. You know now that the wedge broke with authority and as I mentioned on last nights video tagged 1120, broke through i,t and basically landed on my target of 1100. Where it goes now is anybody’s guess, it’s the bears game to lose, but nothing goes straight down.
We finally got the market break down that we thought may be coming. It’s good that it happened and it may not be done yet. 1040 SPX is my target, but it wont get there in a straight line.
As a resul, a massive rally will be coming at some point soon. You can count on it. We need to see if the bears are done dumping everything first or will they wait for a bounce to sell more.
Believe it or not, earnings season will be upon us in a week or two. I hate earnings season and I trade very light. This earnings period could be the final knife in the coffin, as I believe estimates are too high, but that’s just me. If I’m right, the “genius” analysts in their ivory tower will have to dramatically reduce their estimate for S&P earnings as a whole. As multiples contract so do stock prices.
We did well on the chat room today as TZA grabbed us 4-5 points and FAZ was up 12%.
Still no swing longs, as overnight exposure is still just a guess at best, and way too risky.
I will see you all on the chat room tomorrow morning. Get some rest.
Joe