Perspective: Monthly and Weekly Trend remains UP. Friday had the potential of taking out 1394.25 which was the prior week's low however, it stopped short of that level and instead delivered an Outside Day - settling within the Upper Balance Area at 1409.75. Coming into Friday, I had commented that the market was Short and what we observed in the first hour was Inventory being rebalanced. Then came the news that the Federal Reserve was considering further Quantitative Easing and this resulted in a violent short covering rally.
For Monday - I will be looking at where we Open relative to the late day Spike and Distribution 1 - in or out of Balance? The first sign of change to the downside will be price acceptance below the afternoon Pullback Low at 1406.75 which also happens to be close to the the first breakout level and lower balance High. If we auction higher - there is resistance at 1416.75 which was the last breakout level before the S&Ps made the 2012 highs. Building higher value and finding acceptance above 1416.75 targets another run at the Yearly Highs. Following the cessation of 1-timeframing down along with an Outside Day the odds are high that the market continues higher.
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