Potential ST Signposts

The 60 min INX chart shows a TD Supply™ (resistance) line at 1339.5, which is close to the .382 retrace from Thursday's bottom. The TDSEQ sell set up count is 5. If price continues up on Monday and a TDSEQ set up completes (i.e. 9 consecutive bars closing higher than the close 4 bars prior) at a price that does not exceed the TDST line @ 1358.27, that's a sell signal.

Also, another reason to expect a failure on this little swing up on the 60 min chart is that the last TDSEQ buy set up on the 60 min chart is not "perfected" in that neither bar 8 nor bar 9 were the low's of the range (bar 7 was). There was also a TD Trend Exhaustion (UP) on the last two bars Friday.

First signs for weakness would be a TD Line break (drawn from Thursday's low), and a break of the TD [downside] Propulsion threshhold which calculates @ 1326. That is also the prior TDST line (resistance) on the hourly)

Based on the daily charts the expectation is that price still has work left to the downside in that the pending TDSEQ countdown has not completed (on day 10 and 11 on various indices, except $INDU which cancelled it's pending countdown when it completed a TDSEQ sell set up 9 on Tuesday).

A break below 1326 bring into play the downside exhaustion zone per TD Propulsion™ beginning around 1290.

So looking both ways.

Here's the 60 min chart again.

Edited by Geomean, 24 June 2012 - 05:40 PM.

Nice post Geomean.. and exactly what i've been looking for.. a quick drop followed by a more tradeable bounce.

Thanks Dev.