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Tuesday, May 12, 2009

Between 875 Support and the 200DMA

http://www.marketwatch.com/story/technical-battle-lines-being-drawn-on-the-sp-500

I like Michael Ashbaugh he is a very good straightforward technician who provides very dependable support/resistance levels and market outlooks. Every once in a while he provides a free analysis column. Mostly he just shows you what the hand is at any one moment, he rarely makes predictions.

He talks about the S&P500 strong support at 875 and (likely) strong resistance at its 200SMA which I have mentioned a lot and how the market is trading in between.

His article explains things nicely in a nutshell that the SPX is stuck trading between the two for now. Perhaps we have entered another significant consolidation/shakeout period. Sideways grind with whippy moves taking out stops both ways. As Waxie likes to say, don't overtrade things just for the sake of trading.

I thought it was a timely article so I linked it. It pretty much is also how I feel. Kenny too mentioned that 875 will not be broken through the downside so easily. Even I will buy the first bounce at 875.

9 comments:

  1. Makes since if you wind up relabeling (b)with (V) and (c) corrective may wind up at 875 before final push to 200 .....or is that not likely

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  2. Could be Kli. I should post it that way as my alternate but that is exactly where [v] would end up at. And 875 would be the pullback spot.

    In the old bear market, bulls would have just rolled over. This P2 is more take-no-prisoners from the bulls. more than the bears.

    The bulls are still on offense no doubt and the bears are eating table scraps

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  3. DanE,

    Thanks for your hard work and analysis. I had a quick question on uncle buck. The dollar seems to have crapped its pants in after-hours. It made a low for 2009. Whatever is going on it can't be good for the country. A few companies get a penny a share on forex gains next quarter?

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  4. Sorry, the question was whether you had charted the USD and saw any trends/reversals?

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  5. Daneric,

    Glad to see you sold some of 401k. I believe the bear market rally is over. I can see the $BKX maybe rallying to its 200day average which it did in Sept. which isn't too far away. I've posted my thoughts on stockstop last week. $NDX made a new intraday low for its move and has closed below its month opening range the past three days, even on days where it meekly tried to rally. Anyway here is a link to an article by Frank Barbera, who I consider to be the best TA guy in the business. I used to watch him when he was the TA guy on the LA business channel in the 90s. Anyway he has a persuasive argument that the turn is near at hand with all of his unique charts: www.financialsense.com/Market/wrapup.htm

    Mr. Panic of 1907/2009

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  6. can you post in spanish as alternative? tia, ihard time with english, pepe.

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  7. DE - since we think alike you may want to read this -

    http://shankystechblog.blogspot.com/2009/05/us-bank-shares-pump-is-almost-over-get.html

    Thanks for all your excellent work.

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  8. THnak you so much for posting yur excellent work

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  9. Dan, do you ever chart the $BXD? It's the chicago buy/write index. Very interesting to chart. I have a theory that rally may end at $BXD 157.9 - the previous high from back in january.

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