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S.P. Market Update

12/30/09

 

9:19EST

ESH10:

Time to review the immediate term (now) patterns

 New Pattern

C/T

Pointing Up

Equalizer: 1117.25

Up Price Target: 1130.00

Down Price Target: 1104.50

 
C/T from 12/28

Pointing Up

Equalizer: 1123.00

Up Price Target: 1133.00

Up Extension: Up to 1139.50

Down Price Target: 1112.75

Down Extension: 1110.50

 

Patterns pointing up which reach the down targets are reliable indicators the trend is reversing. These are very small patterns (immediate term) which only relate to a immediate term reversal. Generally the rule of thumb is three patterns pointing up that reach the down price target is a confirmation that the immediate term trend has reversed, thereby placing emphasis on the short term patterns, which means only once a short term pattern has reached the down price target when pointing up do we have a confirmation. Therefore the key levels below (equalizers) are extremely important.

 

8:44EST

ESH10:

 

Something important I forgot

The 127 years decennial cycle

Years that end in zero (for example 1980, 1990, 2000, and 2010)

Are always bearish years for the market (look at your historical charts)

 

I’m expecting a move down this year below 665.75

 

 

We have three key levels to monitor in the event the decline continues (it should)

KEY LEVELS:

1102.75

1088.50

952.00

 

Due to following patterns

 

Immediate term: 23 trading days from 12/4/09 (with a 13 day extension)

Today is the 17th day.

C/T (from12/4)

Equalizer: 1102.75
Up Price target: 1137.50
Up extension: Up to 1148.00

Down Price Target: 1067.75
Down Extension: 1053.00

 

Short term: 52 trading days from 11/27/09 (with a 23 day extension)

RCT

Pointing UP

Equalizer: 1088.50

Up Price target: 1166.25 (1140.25 is the ½ point)

Down Price target: 1010.25

Potential down extension: will be determined

 

Long Term: 23 months

Master RCT

From 9/10 – 10/14/2008

Equalizer: 952.00

Up Price Target: 1297.00 (½ = 1153.25) (¼ = 1124.50)

Down Price Target: 607.00

 

The up move has either terminated at 1128.50 or this is the last move up, we will only know once we reach the above key levels. Failure to reach the first key level obviously means we’re heading up to new highs. But never the less I’m expecting the initial move down from the supposed high to be trendy not a selling climax.

Selling climaxes only occur on or around the equinox…

 

 

7:59EST

ESH10:

We have a different AV line on a different chart at 1118.50

Which it appears reasonably resistance begins at 1118.50

At 1121.25 to 1122.25 the resistance is 3.3 times stronger than at 1118.50

The Strongest point of resistance and a key compression crossover is at 1122.50

 

6:56EST

ESH10:

Failure to reach 1112.75 until 9:00EST

Opens the door for a move back up.

We currently have an AV line at 1117.25

In the event we fail to reach 1112.75 and trade above 1117.25 the immediate move up target is 1130.00 before a significant pullback.

At 1126.00 we have a compression crossover which should slow the market down a lot, or even send it back down…(short lived)

 

I’m of the opinion we reach 1112.75 and trade lower down to 1103.75


 

I mentioned yesterday we don’t have an extension; well frankly I’m not sure about that. I haven’t researched the extensions in great detail, they are extremely complex.

Never the less generally when you reach the up price target (a pattern with an extension) and you immediately pullback at the up price target, generally this means we don’t have an extension, but within 6 hours we made a new above 1126.26 up to 1128.50. The black and white answer to if an extension is eliminated or cancelled is if we trade below the upper outer wall of the pattern, then the extension is absolutely 100% dead.

The upper outer wall of this pattern is at 1113.00

The pattern was this

Up price target: 1126.25

Up extension: up to 1137.50

 

 

Early Bird:

ESH10:

Failure to reach 1112.75 (we reached 1113.00)

Immediately reverses the direction (back up)

Up to 1139.50 to 1140.75