Wednesday, September 25, 2013

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Because of the last hour fade yesterday, the 9 count TD Buy Setup on the S&P 500 (SPX) is still active on the 4 hour chart. Current count is on bar 7 which brings a bottom sometime tomorrow. To stay with the parameters, here is the potential scenario for Thursday: A recorded low on the SPX that is above the short term TDST support cluster between 1682.22 – 1685.62 is deemed as bullish as the 9 count TD Buy Setup has finished above support where potential buyers lurk. For today: If downside price exhaustion has already been met, then a close above SPX 1702.63 at 1:00 pm EST or a close above 1701.65 at the end of the day will register a bullish price flip and confirm the downside has at least stabilized. ImageImageImageImage

The daily charts on the various indices are still fragmented. The SPX and the Dow Industrials (DJI) are especially weak. What is notable is the bullish chart on the Russell 2000 (RUT) and that chart is keeping me from being overtly bearish. 

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Judging by the price action yesterday and today, the 4 hour chart has a decent chance of not recording a TD Buy Setup. I will stay with the rules and flip back to neutral if SPX trades closes above 1702.63 mid-day or 1701.65 end of day. (updated intraday) 

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