Thursday, October 25, 2012

S&P closed at a spinning top doji indecision candle which is appropriate considering Apple was about to report their 3rd quarter earnings after the bell. The first response to the earnings is for more weakness for tomorrow morning but there is a lot of time between now and he next day. In context to the daily DeMark, the TDST support is at SPX 1403.74. A close under SPX 1403.74 is a bearish continuation.

Looking in on the micro level with the S&P four hour DeMark which completed their nine count today which kept me long today, Going forward, the bear case would be a print below 1401.33 at either 1pm EST or at the 4pm EST close. The Bull case is to look for a price flip which is a close higher than the previous 4 bars. In this case for the S&P, it would be a close above 1415.28 at 1pm EST or a closing price 1409.12. Also note the daily and the four hour share almost the same support line.

I remain 25% long but Friday is my make or break day in accordance to the DeMark support as I’ve outlined. If we break 1400 intraday, I’ll be neutral and I’ll look for signs of a turnaround to get long but a close to at least 1400 is what I need to see for me to stay confident in holding long.



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