Originally Posted by Vanity
We are definitely biased to the downside, but there's always 3 different scenarios on the table at all times. Right now I think if we break 1305, we're headed to 1265-1215 (maybe even 1200), and from there we can analyze whether or not we're looking at a big 2nd leg up, or a crash down. If we break 1335, we might be headed to 1420 (but no new high made, but certainly has the potential to be damn close imo. A mother of all kahuna crashes would be setup for a major short up here, in this scenario).
1305-1335 trading range for now imo, with a bias to the downside but anything is possible as always. We have expirations and dividends this Friday. Might be a push higher on that alone into the weekend, not necessarily to be interpreted as a speculation on Greek election results. Sam I hope you suck up all this information and become the most successful kid in your Undergrad
Posted this June 12. I'm going to see what the market does around the 0.618 level. If it doesn't hold as resistance than the original thesis of a break above the 1305-1335 trading range leading to a potential run up to 1420 is on the table. That would also square with R0wrs original thesis, and also Mact.
It will be interesting to see if the fed does anything tomorrow, or if we just end up range bound between 1270-1360.
UPDATE: 2:38 pm ET.
We are getting a reversal here. We hit the 0.618 retracement level perfectly. The spx has since retraced downwards to, currently, 1357-1358. i went full short recently believing that this level could not be taken out without QE3 or a combination of Twist 2. But these two things are pretty much off the table in my mind. This is an election year. Bernanke needs SOLID downside in this economy otherwise his actions will be ambiguous or even synonymously political, instead of being purely economics-based. Considering how we are only 3-4% down for the year, and yields are already suppressed so low, it's a fat chance IMO. But the 0.618 is key. If it breaks, 100% retracement back to 1420 (potentially). As of now however, we are getting a back-down from those levels. Gold is also NOT confirming any monetary stimulus tomorrow.
Mini-Update: 3:00 pm ET. Also, intraday MACD is showing divergence and not confirming the move up.