Chart and Data Download SRT20100107
Friday Morning 8AM Jan 8 2010 Comment for Thursday''s Close: Forecast remains bullish until the S&P reaches chart Objective at the upper red envelope,now S&P 1157-ish.
As the rally continues it should not peak until the cash S&P at the days high is at or above the level shown in the tabulated column for the upper envelope. It is possible for small correction of a few days to interrupt the rise to the upper envelope but a 5% correction is not likely until after the Objective is reached.
The small red T and the larger blue T are jointly forecasting an eventual peak time wise at their respective right end dates (by Jan 21?). What is interesting about the red T is that we couldn't get confirmation because initially the rally would not cut the green cash build up line. Now we see an upside breakout in the blue volume oscillator going into the Ts projected peak. This amounts to an accelerating demand going into a top which invariably is caused by "panic buying".
Such acceleration is keeping the Arms ratio very low which warns that when the buying ends, a sharp correction should follow. However it should not break below the mid channel number which is also rising, so the correction is likely to be sharp but brief. The 5% correction can be bought because other larger Ts are still bullish.
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