There it is on the daily. Doesn't look to far off. Of course it doesn't have to move at that pitch, it could take a few days to get there. The market also formed a nice Hammer Candlestick. Plus the 20 and 50 look like they are going to cross. Also the Bull Flag/AB=CD is not valid if $SPX goes below 828
There is some talk the the market is "overbought". I don't see it on the indicators, in fact they look like they could move a little more before being "overbought". The market was overbought in the beginning of March too, we still climbed.
Look at the weekly, it's not even overbought and looks like it wants to run.
But before you go out and buy stocks let's see if there is any resistance. 849 should provide a good amount of resistance. It is a 23% Fib from the May 08 high also it's November lows and the downtrend line.
Now if we have a down day on Monday a rare chart pattern would form. The "Ladder Top Candlestick"
One thing the book says is that "Bulls have to be complacent" that can be intreputed as, "is there any fear in the market".
Let's look at the VIX and the other indicators in this market
The VIX broke below 40 on Friday and is below its MA. So there is a lack of fear in the market. The chart shows the $NYMO which is still not showing overbought.
This is interesting market right now, because the ST is meeting up with the IT. The market looks both bullish and bearish depending on your time frame.
For me I am not comfortable getting long here since my time frame is longer. But by my analysis I see the market still going up, but only another 27+(869) points, also if the AB=CD is not valid my loss is -14(828). That doesn't suit me,plus 848-850 might be resistance too.
I think the better risk/reward play would be at the short at the 848-869 level if we don't reach those levels I be comfortable shorting possible around 828.
So I am looking to go short at these levels.
SPX=848-869
VIX=below 38
NYMO= Above 100
