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Why is 1220 so important ?

My trading may change overnight.  However, I am still bearish, which I believe fits into this market.  Take a look at the chart.  I have drawn two blue lines. These are longer term resistant lines, which is 1220 (April high) and somewhere around 1000.  This gives me pause.  We started collapsing at 1220 in September or October and rallied up to 1300 before we fell.  We started this rally at 1000 and may go to 1200. No one seems concerned that we are 200 points below where the last rally topped. I am majorly concerned.  Your returns are only as good as the sequence of them.  If you make 40% in one year and lose 80% the next you don’t have a 40% return.  You must ask yourself did I make money year over year, not month over month and day over day. 

We started collapsing at 1220 (look at blue arrow).  We got at the same exact level and broke down.  We had an enormous anomaly during February and March of 2009 that made us collapse. Eventually the fundamentals will take over from the fanatical speculative traders.  It is so funny, the movie Wallstreet comes out and everyone thinks they are Gordon Gekko (that is a fictional character).  It is fictional, but entertaining. However, that is not how we trade. 

Once we get above 1220 we will know what is going to happen. We will either go to 1300 and then 1350, pullback and then take off to the races. The big move is not from September to today.  The move will come after the breakout.  We want the market to be bullish. We want the 150 to start pulling up and the 50 to cross over and then we will have our breakout with a safe entry.