I1 bottoms at the close Thursday or Friday. My target is SPX 1268 but will depend on the count. Regardless I will not stay short past Friday. Last week's decline was 5 down so I expect new 5 wave down to culminate this correction. Looking past 3/4 I am still bullish based on I1 even though the wave count is complete for the bear market rally from 3/9/2009 to last week's high. If this correction is deep enough the market could rally into the 3/25 I1 peak and still maintain the overall complete wave count.
Last night, the upward retracement of the 5 down reached 78.6% in the DJ futures. I entered today 6% SDS but sold 2% after the close at 22.02. DJI cash caught support at 12,000 round number and after the close DJ futures declined almost to Thursday's low. In addition SP and DJ futures count 5 down.
If the 5 down is complete I can expect a rally back to the declining SP 30-minute M/A. The 50% retracement level is 1316.50 where I will have my order to short. Currently I am flat futures, 4% SDS, and 4% TLT. I am making money with chip shots, the way I like it. The time to pull out the driver will come mid-May.
TLT recovered all earlier losses and ended with a gain. Tomorrow I will enter an order selling TLT at 92.67 to catch a daily M/A.
The dollar had a tepid rally on the stock market decline. Big money is not yet flowing in.
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