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Friday, September 24, 2010

Friday Weekly Charts

After 3 straight down days, and a nominal pullback, it was only natural for us to start heading back up, b ut the magnitude of today's rally caught me a bit by surprise. Not a surprise is the lack of volume. 1155 is the current upper limit to the range we are in, but my prognosticator says we wwill probably go to about 1180 before this is over and we head down again.

On the weekly chart, instead of trying to project targets, I have the range we are actually in now, which is 1010 to 1220, with about 1115 as the mi point, and that is where the 40 week average is. This correction went far longer and deeper than a bull market correction, and is probably not over yet. Stochastics tell us we still have room to move up, and MACD has managed to turn upward, and the 10 week is just below the 40 week, so while we could be on the cusp of another bull move here, I doubt it. I have a hunch we will see some whisawing in the coming months, and I don't expect to see 1220 for quite a long while, but we could see 1010 or below beofre the end of the year.From an Elliot Wave perspective, we are in wave c of an ABC corrective wave up, which should end soon. And if I'm wrong, it's the PPT's fault.

The dollar had a big week, breaking the 80 level, which, if nothing else, is important psychologically. Unlike the down move in 2009, this one is not helping the market much, as it is not the Euro the dollar is dropping against, but the yen.

The 10 year treasury, unbelievably, is now trading at levels last seen in March 2009, when the stock market hit bottom. The momentum indicators say it will drop more, just not as fast. This will not end well.

Apparently "this will not end well" is what the gold market believes as well, as this has been in a steady uptrend for two years now, since the 2008 "collapse" which barely looks like a blip on this chart. I think this will hit 1360 fairly easily, then after that I have no idea. I have a feeling this is not going to end well, either.

I will have the new highs update shortly.

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