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[Doug]

The Evening Doji Star pattern is a three period bearish reversal pattern similar to the Evening Star. The uptrend continues with a large white body. The next period opens higher, trades in a small range, then closes at its open (Doji). The following period (next week) closes below the midpoint of the body of the first period. Although this is a weak bearish reversal pattern, there is no corresponding bullish continuation pattern. Therefore, if we do not get strong conformation of reversal with next week's activity, I expect and predict, we will see continued choppy sideways motion in a vary narrow range. Look at the Put/Call Ratios and Open Interest volume to get confirmation of a reversal. What to look for. If the SPX closes (for the week ) at or below 1500, then we have confirmation of a reversal. Still this is not the strongest of signals so don't expect the bottom to fall out. Rather, expect the SPX to fall to the 1440-1460 range and then (in the absence of another stronger signal) continue climbing. If the SPX simply chops along and doesn't pierce the 1500 level then expect it to stay rangebound between 1515 and 1540. Regards,

[Bob-C]

The Evening Doji Star pattern is a three period bearish reversal pattern similar to the Evening Star. The uptrend continues with a large white body. The next period opens higher, trades in a small range, then closes at its open (Doji). The following period (next week) closes below the midpoint of the body of the first period.

Although this is a weak bearish reversal pattern, there is no corresponding bullish continuation pattern. Therefore, if we do not get strong conformation of reversal with next week's activity, I expect and predict, we will see continued choppy sideways motion in a vary narrow range.

Look at the Put/Call Ratios and Open Interest volume to get confirmation of a reversal.

What to look for. If the SPX closes (for the week ) at or below 1500, then we have confirmation of a reversal. Still this is not the strongest of signals so don't expect the bottom to fall out. Rather, expect the SPX to fall to the 1440-1460 range and then (in the absence of another stronger signal) continue climbing.

If the SPX simply chops along and doesn't pierce the 1500 level then expect it to stay rangebound between 1515 and 1540.

Regards,

Hi Doug, thanks for the heads up on the Evening Doji Star bearish pattern and your insights.

Cheers,

Bob-C