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Weekly charts and analysis

Posted by Capital3X | Posted on 21-10-2012

Markets kept selling to some excellent economic data and you would suppose that this is the end of the bull run as so many times you would have been forced to think over the course of the last few weeks. But as I proceed through charts below esp with evidence from the currency world, we are only scratching the surface of another 10% gain coming in equity markets at an exponential pace. Even last week drop on SPX was a health reminder that a balanced pattern was being made.

Last week performance here: Performance

The ES weekly charts is portraying a lovely and near perfect bullish reversal via doji. The bullish reversal doji is normally made after a down week followed by a bullish spike to nearly the highs of the previous week but only to close right at the low of the week. A long handle above the close. The bullish reversal will have been honored if we do not break 1416.

On the daily, the ES has held this zone 1420 for more than 3 times in October which makes it even stronger as Weekly comes in with a doji. The Netline sell stands at 1420 and if it gives it way we are headed 1388 zone which is the mid lines of 100 BB.

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Summary: So all in all, barring a few conditions and levels that I have highlighted above, we are pretty much at the bottom of the selloff needed for the next leg rally up for SPX, Oil and USDYEN.

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