wednesday brainstorming

1. The market (SPX) traded as expected so far we pulled back to the 1300-10 support level, although he perversion these days is as a regular hour trader you might miss the most crucial part of trading. As the Venus Saturn square ends today we rather can expect a relief rally in the second part of the week thereby the weekend factor may be rather negative again with the Full Moon ahead on the 15th in Capricorn close to the USA  native Pluto position. That matches perfectly the debt ceiling talks drama due the next days but around the 19th we can expect some sort of break through as heliocentric Mercury will enter Sagittarius which stands for an optimistic time frame but usually indicates Currency strength hence Dollar weakness and rising Gold implicating that the debt ceiling resolution will rather be a last minute thing. Hence we can expect a zigzag pattern in stocks as the recent correction in stocks was just an A wave down so far we should expect a brief B up followed by a C down before another upside wave towards new highs is likely. Google earnings tomorrow will be rather on a positive bias ,JPM not so much but the finance sectors are anyway in a bad situation with the worst performance.

Apple chart looks very constructive tested back the former resistance as support around 350 and with next weeks earnings we can expect a steady rise to the 390 level as with Lions ( new software)  new product lines will drive the market share up and IPHONE 5 due in September the stock looks really still decent priced around 13 times current earnings.

2. The sentiment is neutral mostly but in real market terms the MA’s of the ISE ( put call ratio’s) we have rather reached a very bearish sentiment – hence in market direction rather bullish as it is a contrarian indicator. In the last 3 years we only we reached this kind of levels twice last was July 2010 which was followed by a  rally starting August and in March 2008 which was also followed by a 10% plus rally til May before the crash started. That is one of the factors which makes me believe we are still not done with the top as we also have unfinished counts on TDM weekly charts, who suggest we need to make moderate new highs for the DOW and SPX before the shit hits the….

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~ by behindthematrix on July 13, 2011.

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