Wednesday, October 28, 2009

Scraping bottom

Here is an hourly chart showing day session e-mini trading. The market has dropped into the 1045-50 downside target zone (green oval).

There is strong support here. At the 1049 level the length of this reaction would have equaled the average length of the three preceding reactions on the way up from the early July low at 866 (purple rectangle). The 1044 level is midpoint support based on last reaction which carried the e-minis down from 1076 to a low at 1012 (electronic) on October 2 (purple dotted line). The rising trend line from previous reaction lows now stands at about the 1040 level.

I think the next day or two will be spent trading sideways between 1040 and 1065. By the beginning of next week a rally to 1120 should be underway.


jlk said...


Why cant there be a bigger correction than the average of the last three?

Adsense said...

Hi Carl
i still think this decline should be similar to the june july decline in which the spx fell 9 percent from high to low . a 9 percent decline from the 1101 high
would target the 995 level.
on the dow a 9 percent decline would target 9200 . so im keeping my veiw of a move back towards 9000
on the dow into nov 12th . weather it happens or not though remains to be seen.
good luck joe

ps there is many similarites
to the march june rally and july low to the july oct rally and today .

jeff said...

Does anyone know the point differencial between e-minis and the SPX? If so, can you provide?

TradingNuggets said...


Why are u so **** bent on the S&P going to 1120? I know that is the 50% retracement from '07 but we need a 5-12% correction on the S&P before the next run if we have a run at 1120 at all.

You are usually right on your calls so I remain open.

Thanks for your daily/intraday input.


F&H Painting said...

Below 1040 now.

Tigger22 said...

Wags, nice to see ya. Internals extremely bad all day, and looks like we're gonna close extremely bad. Somehow, I don't see this stopping. We probably topped at 1100. We sliced through the 40 sma. What do you think? thanx

Laurence said...

Jeff, I assume you are asking how much fair value of ES is below SPX, now about 3 1/4 pts.

F&H Painting said...

Carl holding overnight?

extrader said...


You still Long ur position from 53?

dcatlowpj said...

It's a tough long. After breaching $1050 and holding, I shorted into the close and netted 6 points for the day. This was an obvious short at least to me today. The 53 entry looked good but broke down quickly. There were volume clusters later in the day that showed pivots that were clearly price levels that traders respected....I could stay in my trade based on rejections of MA lines (20ema) based on Al Brooks' style on a minute chart executed on a 2min chart as the day wore on....good day for me. I logged off and then re-entered after 1pm.

evi-und-juergen said...


the low on oct 2 was 1012. 1x1 Gann-Line today stands at 1036. As long as this index can hold 1x1 Gann-Line on closing it is in a strong position.

Regards from Germany

truyenh said...

This is my first comment on this board. I've been following Carl broadcast for last few months and I must admit Carl has been fantastic in providing the helpful and flexible technical analysis for this crazy market. I notice that the market pattern for this month is resembling the pattern in June. Since the s&p has been making a quick drop in the last 3 days and hit the bottom of the 3 month channel, I expect a bounce to 1069 area and there posibly another leg drop down to 1012-1025 range (to the 38% retracement of the run since July) before it make a move back to 1080 level. JMHO