Tuesday, March 06, 2007

The Inevitable Bounce

My system has moved lower and the sell signal is still on. We are now at just above -600 in my system. The momentum did moderate considerably in my system but we need to see a stall in one of the next three days to say that the selling is over. If we bounce from here in my system, the bulls should be wary because -1000 represents firm bottoms and we didn't get there yet. It would be better if the selling resumed tomorrow. Regardless, if this was the bottom week then a buy trigger would be above the high of the bottom week and this trigger wouldn't come until next week at the earliest. CME, an absolutely crucial stock, bottomed 6 trading days ago and has been rising ever since. Its refusal to break down so far is a good sign for the bulls. Whether the market has bottomed has everything to do with China and the Shanghai Index continues to stay above the 50 day SMA, if it breaks that into that 2400-2600 zone for one more scare then I think we can get to -1000.

0 Comments:

Post a Comment

<< Home