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Sunday, April 26, 2009

$DJUSFN and FAZ Charts

One of the reasons I bought FAZ at $8.12 was the clear EW patterns that have developed in the banking index and hence the $DJUSFN off the early March low. It sure looks like a 5-3-5 zig zag.

The correction off the top looks like a 3-3-5 flat (just like the SPX). The "five", or C leg has yet to play out and it holds the possibility of being a nasty little C wave down. Perhaps FAZ has a chance of doubling. I would certainly sell it at $16.
Huge volume in FAZ and positive divergence going on. But boy does the decay kill it if its not moving up...but then again, it works the other way around too.


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