The Document

Login Subscribe Now
December 2, 2008

Speaking Volumes

Peering at price action, the S&P 500 chart has the markings of an index ready to crater. Our double loop ending pattern (yes, I know you won't find that in any TA textbooks, but that's what makes it valuable) suffered a steep drop away from the downtrend line, and today's action took a form which typically leads to another steep drop within a couple of sessions... a classic narrow-range consolidation.

Or did it?

index charts

Like yesterday, the price pattern is unfolding in a manner to support our scenario "C", but volume isn't cooperating. Being a stickler on volume here may seem a bit picky, but improper volume patterns have helped me root out head fakes in the past. Let's see if the intraday action can provide any more clues:

index chart

I'll bet sentiment is heavily leaning toward an end-of-the-world meltdown from here, but personally, I wouldn't be surprised to see a a rocket shot past SPX 900 in the immediate future. The dollar isn't cooperating just yet, but let's give it another day, shall we?


blog comments powered by Disqus
Recent Blogs

Macroeconomic Blog | Cycle Trading Newsletter | TrendBands Fund | Library | About | Contact Us | Members