- WE'RE JUST RANDOM SPECKS OF DUST IN A TORNADO TO THE MARKETS .......
- CHARTISTS MUST PUT ALL BIAS ASIDE AND LET THE CHARTS DO THE TALKING OR WE'LL SEE ONLY WHAT WE WANT TO SEE
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Friday, 6 February 2015

Seven Brides for Seven Brothers

SPX had a strong day yesterday and came within two points of testing range resistance in the 2064.5 area. We should see today whether bulls can break over that strong resistance. If they can't then support is at the daily middle band and 50 hour MA in the 2031 and 2026 areas respectively. SPX daily chart:
So which way is the market going to break at this big inflection point? There's only one way to find out for sure but when I looked at my seven US indices last night to see if there were any clues there, I found that all seven had formed 69% bearish rising wedges from the last low. The first three of those are on SPX, INDU and TRAN below. Screen 3x 15min SPX INDU TRAN chart:
The next three are on NDX, RUT and NYA below. The last of the seven is WLSH and I won't show that today but it's similar to the others. Screen 3x 15min NDX RUT NYA:
I have CL in a likely rising channel from the current low and it could reach my declining resistance in the 58/9 area within that channel. CL is a buy on dips until that target is reached or rising channel support is broken. CL 60min chart:
It's important to remember that although rising wedges are 69% bearish, that does mean that they break up 31% of the time. These patterns are very much leaning bearish, but the bulls still very much have a shot here. I would start getting edgy about the bear case here on a move much over 2064.62 SPX. Until then I'm leaning bearish and caution is required until after the NFP number which is out an hour before the market open.

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