In other words, I kept looking at ER2's 764 and wondered if that's the top.
By now, I'm no longer wondering. I'm theorizing that 764 is MY top. It's a view I take. And I trade accordingly, until I have reasons (market conditions mainly...and when all who are calling people to buy because we have bottomed finally stop talking) to believe that my view is wrong.
Chart time!
Not going to go into DOW, S&P and NDX - we know how they are doing. Their charts are just indecipherable (to me).
RUT
RUT daily chart from 1991 to 2008:
I take a seed (the green shaded area) and draw both fib retracement and fib projection using the seed that is my wave 1.
Rut is currently about 40 points above fib retracement level of 38.2% (663). And it looks like it's wave c in the making.
Key support is at around 608, and that is where fib retracement 50 and fib projection 100 are too. Given that 663 has already been tested multiple times, my thinking is that if outlook continues to be grim, this support is not going to hold, and RUT is going to fall right through it. And the next support is at 608.
Rut is currently about 40 points above fib retracement level of 38.2% (663). And it looks like it's wave c in the making.
Key support is at around 608, and that is where fib retracement 50 and fib projection 100 are too. Given that 663 has already been tested multiple times, my thinking is that if outlook continues to be grim, this support is not going to hold, and RUT is going to fall right through it. And the next support is at 608.
RUT daily chart from May 2008 to Sep 9 2008:
RUT has closed below MA 50 and 200 support, and below neckline (in brown). Another close below the neckline would give me just a little more conviction that it's going to be falling right to 647 in the short-term (days??).
The long bearish candle on Sep 9 has closed the gap between Sep 5 - 8. Putting aside the reality in the market, the chart alone tells me that a gap up in a downtrend is going to be trouble for the bulls. Granted that profit taking is happening right now, given that sentiments are so bearish all over (all major indices lost more than 2 % yesterday, and sectors across the board are doing terribly), today's direction is likely to be DOWN.
That's just my take, of course.
The only econ data to be released is oil inventory. But whatever the result, I don't think it's going to have any bearing on the market anymore.
Everyone's focus is on the finance sector now.
The long bearish candle on Sep 9 has closed the gap between Sep 5 - 8. Putting aside the reality in the market, the chart alone tells me that a gap up in a downtrend is going to be trouble for the bulls. Granted that profit taking is happening right now, given that sentiments are so bearish all over (all major indices lost more than 2 % yesterday, and sectors across the board are doing terribly), today's direction is likely to be DOWN.
That's just my take, of course.
The only econ data to be released is oil inventory. But whatever the result, I don't think it's going to have any bearing on the market anymore.
Everyone's focus is on the finance sector now.
ER2
For those who bought on Monday's rally, some will be holding on as price slides across the sector, and the rest should be selling in frenzy, a reaction to the Lehman saga. Whether all who bought and wanted to get rid of what they had have sold yesterday remains to be seen. What I know is that if the session today does not go down to the a level below yesterday's low in the first half hour of the session, then sellers who jumped in yesterday and had not covered will be covering in frenzy, and we might just see something like this for today's session:
Or like this:
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