Thursday, October 07, 2010
Here is a five point box, one box reversal point and figure chart showing 24 hour e-mini trading since the July 5 low at 1003. Above it you will find a daily chart of the e-minis.
The market has recently broken above the late June and early August tops, thus completing the breakout from a head and shoulders bottom formation that I first mentioned in this post.
The standard head and shoulder projection is that the rally from the right shoulder should carry as far above the neckline at 1125 as the distance from the head to the neckline. In the current situation this projects a move to 1240-50.
The point and figure chart is telling the same story. I have drawn two counts I am currently tracking (horizontal green lines). Both project that this rally will continue to 1240 or so.
The message is clear. New bull market highs lie ahead. In fact, I think that the S&P will move pretty close its 2007 top above the1500 level before the move up from the March 2009 low at 666 ends.