Wednesday, April 02, 2008

Cash S&P

Here is a bar chart of the cash S&P 500. I've sketched the price boxes defined by the initial rally off of the March 17 low at 1256. These boxes are 104 points high. I think that we are in the midst of a rally that will carry the market at least to the top of the second box near 1464. I should note also that the 1440 level is the 1 7/8 multiple of the 768 low of 2002 while 1248 is the 1 5/8 multiple of the same low.

As you know I am very bullish because I think the panic of the last two months has forced most people to the bear side of the ledger. I see a very substantial base which has developed over the past three months in my point and figure chart of the Spiders. This base counted very conservatively will support a move to 1570. If counted normally it supports a move well above the 1600 level.


Anonymous said...


Anonymous said...

Hi Carl,
I would like to ask you - if you have got time, will and interest - if you could project your box theory on the ER2 (Russell 2000 emini or IWM ETF). I expect a rally back to the 740-760 area (maybe closing the daily gap around 760).
Let me know should you decide to do that. Thank you.

Anonymous said...

Hi Carl,
I came with the following values for ER2 emini.
Lower box range: 640 - 706.
Higher box range: 706 - 766.
Being a little defensive, this means start selling in the 755-758 area.

Have a good night

Anonymous said...

Hi, Carl

Love to see these boxes. Could you also give an update on China as well.