Here is a 5 minute bar chart for the e-minis over the past two days. The market has just made a new low for the day and the question I have been considering is just how much lower might it go today or early tomorrow.To make a guess I like to rely on the market's recent habits. The first red rectangle you see represents the distance this morning's low was from yesterday's low - about 11 points. The second red rectangle shows an 11 point projected drop from this morning's low - the bottom of the rectangle is at 797. The first blue rectangle measures the length of the drop from yesterday's late rally high at 836 to this morning's low at 808 - about 28 points. The second rectangle projects a 28 point drop from today's 825 high - again we come up with 797.
Over the past month we have seen lows at 806.25 and at 797.50. My guess is that more sellers will come in when those lows are broken. So I estimate that the next rally will start roughly from the 790-95 area.
4 comments:
Nice work Carl, I think we began the rally off the old support level at 805; close below 825 I think you'll be vindicated.
Brent
If those lows are broken, it will not stop at 790 ... we'll go lower than that!
Dear 4:09 pm
Well, today the market broke below the 806.25 low. Today's low is 805.50. Right afterward we saw a 30 point rally.
Dear Carl:
If the low of 797 is broken, we're going lower than 790 ... that is what I meant.
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