Saturday, January 24, 2004
SPX 60m chart in the spotlight
Complete Charts Update (MANY MANY of them) [ edited: stockcharts.com list no longer active ]
There's quite a bit on this chart, some for targeting, some for learning.
(1) LEARNING: In an idea from Ron Wheeler, 'mini' Regression Channels are used to gauge when (and if) a rebound off a pullback low is buyable. The channel is complete on the first higher low off a pullback. SCC's % is a bit wide for this purpose, so I've sketched in tighter bands using hi/lo's within the band. The orange arrows mark the Buy Signal (first closing bar outside the band).
(2) This move was very geometric, the high being within a hair of an AB=CD off the low. A comparable AB=CD pullback is -1.3%, or 1135.5.
(3) This 1135.5 is also confluent with two Andrews crossing, an just above the 'pullback mini-fork' (the black one) at 1136. That the low price was 1136.85 is a bit troublesome (a tail touch of 1136 would have been more ideal), suggesting perhaps a test of that 1136 before a move back up.
SUMMARY: A break of 1144 (with a corresponding break of the RSI overhead trendline) is a buy, however, with diminishing returns as there is now resistance at the recent highs. A break of 1136 confirms a deeper pullback.
(click for full size image in new window)
Labels: chart-analysis
At last, over the rim
of the waiting earth
the moon lifted with
slow majesty
till it swung clear of the horizon and rode off,
free of moorings
- Kenneth Grahame,
The Wind in the Willows
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