Market should not fall far

to coming into market first feww days the next month. just a thought.

August is known to have the best low volume market rallies among the summer months and the market has enough momentum to carry forward for a few more weeks, the gap will be tested at a minimum, I will be a seller of anything higher. There is also an outright chance that this was the entire excitement, but I really see no excitement AT ALL despite everyone is claiming to have turned bullish... The options data is not bearish.

arbman, when you talk about the gap, do you mean spx 1099? i have seen you refer to the 1050 gap - is that in terms of futures

The gap is pretty large honestly, it begins around 1050-1060 and goes up to 1090-1100, that's right... If you look at many longer term moving averages (several weeks to months), their acceleration change significantly with that crash. We had a complete change in the market behavior with that drop, in terms of the volatility and the trends. The gap is like a magnet, almost all large gaps get tested eventually, but it will be also the end of the market rally probably...

Let me say this year clear, if by any outside chance the market closes on a weekly basis over that gap, say 1101, the bear market is over. The trade is that certain that the rally to the gap will fail, the large brokers know this, they are pushing rapidly to the gap now to mark up and sell as much as possible. If the plan was to go over that gap, the market would steadily rally, this plowing through will not work over 1000 once all shorts are murdered...

This is my position, this is my thinking at the moment, I said many times that the gap should be tested in 2009 sooner than later...

2080 level is the high for october and also key, close above it and there is room to go above 2300 (and end the bear) nonetheless it is fascinating what can be done to markets during summer months

we just got official word "the recession is over" top marker?

Edited by skott, 27 July 2009 - 02:21 PM.

Concept of 'window dressing" is likely a thing of the past what with such things as high frequency trading now accounting for the bulk of the volume everyday.

I don't know about the next 1-2 days, there should be more pull backs here due to the extremes reached. But, this also means and I tend to think that given the price and internal momentum extremes reached from the July lows, the market should at least make another divergent momentum high (implying another price high) in the next 2 weeks.