Different time frames tell different stories.
by
, 05-21-2009 at 09:27 PM (1414 Views)
Last night the futures were down, so I cracked open a 15 minute chart and looked to see where the downside action could go. In yellow, I drew in what I thought to be two deformed Head & Shoulders whose angles of descent were exactly the same.
My theory was that the bigger H&S would follow the same path as its little brother and sure enough, (1 second gloat ) the pattern met my expectations.
For tomorrow's action I'm keeping in mind the last time the 15 minute tried to take over the 200 MA (red circle) it took 2 hours to punch through. This morning, we opened & gapped under the 200 MA, so I'm wondering will it stiff-arm us again? We did close above the 20 MA for the first time in over a day, so I guess there might be a little bullish action left in there, but it sure doesn't seem like much.
In reality, I don’t know how this chart will play out, but If you’re a Bull, I would be surprised if we close above 899, based on resistance at the gap and the 200 MA. So maybe 10 points of upside action can be expected.
Now if you’re Bearish, then you might like this 60 minute chart better. We have cracked, and twice broken through the rising channel. I really don’t like that rising channel anymore because she has broken my heart, so I’m moving on to a new girlfriend. Her name is “Death by a thousand cuts Declining Channel Charlie” or DBATCDCC for short. For the downside action, she could give us an 18 point close at 870 on the button. Now I also want to point out that SWEET bottom bump off the 200 MA at 879!
There is only one thing I want to point out on the Daily chart. THIS IS THE FIRST CLOSE BELOW THE 20 MA SINCE THE 666 TREND CHANGE!
Lastly, please remember to keep SqualeBear and his Mama Bear in your prayers.