Friday, October 29, 2010

8 to 10 new highs pattern in play on ES, SPX and SPY

On this special post I'll talk about a pattern that is in play on ES, SPX and SPY which might indicate a reversal on markets.

This is a very powerful pattern and is about to be completed either this week or next, the name "8 to 10 new highs" means exactly that, when market makes the 8th new high it might make a big correction, as it did not happen on the 8th (which was last week) might happen now in the 9th week or at the most at the 10th week which is the next one, first week of November.

So, now we just have to watch and play accordingly, IMO, we will still see a new high by the beginning of next week (or who knows, at the end? could be by Thursday) and I expect that high to be at 1207-210 on SP500 - which is equivalent to ESZ0 at 1204-207 (where I intend to short double - half for a day trade and half for a swing trade, *IF* these levels will be really tested).

It's not my style but this time as asked on Twitter, I'll post a SPX chart showing the evolution of this pattern:

(if you want to see a larger chart just click on it)

Good luck and happy trading!

No comments:

Post a Comment