TF 1/30

Dow & SPX Daily

Round bottom (Jan 15 - 28) on both...that's going to be a straight line down to at least the Nov08 low. Simply put, market's looking bad, and I'm bearish again.

TF 30min

Pattern I'm looking to trade: Head & Shoulder / Measured Move Down
It looks like we're going into correctional wave 4, and the session today could very likely see the completion of wave 5 - which is visually the 2nd leg of a measured move down.

And if that happens, it will complete what looks very much like a Head and shoulder pattern on the 30min chart.

Plan A

• Short at: 457 - 459
• Exit target 1: 450
• Exit target 2: 440

Plan B
(This is is for the scenario where TF doesn't even go back up to test resistance at 459)

• Short at: 450 - 451
  
• Exit target: 440

I'm suspecting that we'll be looking at a rather narrow range today, so I really don't have very high hopes that TF will hit 440. The right shoulder needs time to form afterall - if that's really a shoulder that's in the making.

I would like to see bearish patterns developing around the 450 area on the lower timeframe before considering any shorts below that level.