Have a nice weekend
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SPX target 1650 is posted on 9/3 as shown below with technical analysis. While many traders are bearish, I believed that our economy is increasingly globalized so that we have divergence market internals with strong and weak sectors as markets are moving forward. I noted "Global Economy" cycle during Jun-Jul 2006 bottom with supporting technical analysis charts.
Since then, we have Asian market outperforming our markets as $SSEC Shanghai has traded up with high beta to catch up with US markets.
Global based companies are doing well as we heard "CSCO" CEO comments that he has seen the strongest global economy in his life time as he noted after the last earning report. We now have "MSFT" strong earning report. We also have strong or good earning reports by "RIMM", "GOOG", "AAPL", "BIDU", "INTC", "YHOO", "EBAY", etc. This is during normally weak earning quarter Q3; so, we will likely have better earning reports for Q4.
$USD is targeting 76, then near to 73 +/- which is a long term support. The lower $USD will help exports and global companies such as "MCD".
Higher oil price is because speculative premium and we need to conserve oil and energy. We need to develop alternative energy from other sources such as solar energy.
We have seen high volatility as SPX has moved 30-40 points a day. Considering the moves, 200 points to upside seems to be attainable. I am still looking at SPX 1700 and will add my thoughts later; however, as noted before, Jun-Jul 2006 was 4 year cycle low based on my analysis; and from the low, SPX 1685 +/- is 38% extension of a breakout from SPX 1550 Mar 2000. SPX has shown initial breakout to SPX 1576 on 10/11/07. While some traders see it as a false breakout, my view is consistently that it is an initial breakout which we will likely see a completion of the targeted SPX 1650 +/- which was the initial target. Considering the cycle analysis based on LT, 50 +/- points are not significant variance and also considering the recent volatility which we have seen.
I hope that markets will show good breadth to attain the target, and we will see.
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Posted by: corrina
In reply to: None
Date:11/2/2007 8:26:34 PM
Post #of 4060
The 1700 DEC calls have about 89k contracts most of them bought between 1-2.50 with alot being bought at 2.00. I am putting in some money monday to try to buy them at .05. I think we might get them if we trade down to 1476 level or so which I would like to see then a huge rally off that level again. So I will be putting some money to work early next week with orders in at that price and leave it there. What I am hearing is a big rally into end of year, but I don't think it will start until Nov 15-17. Interesting Abbey Joseph Cohn came out when we were at the highs recently and said she expects 1600 by end of year, and of course we sold off. Only once that I have seen where she said the market was going up and it did, normally it sells off then it hits the target she projected, so most likely. So the 1700 could still make one alot of coin on a 100 pt or more move, especially if we can pick them up for .05. Last trade was .20 and the bid was .20 and the ask was .25. Worth putting some money to work.
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SPX Target 1650
Global Economy: SPX Breakout Target 1650
SPX breakout from 1555 is targeting SPX 1650. Breaking out of SPX 1555 in our global economy is reasonable as we are coming off major IT breadth bottom with positive divergence in Aug 2007.
Major Market Cycle Bottoms in Oct 2002. Market has risen 420% since 1975 bottom, 200% since 1982 before it corrected 35% in 1987.
SPX has corrected 50% of 1980-2000 rally during 2000-2002 which is a significant correction.Breaking out of SPX 1555 in our global economy is reasonable as we are coming off major IT breadth bottom with positive divergence in Aug 2007.
http://www.stockcharts.com/c-sc/sc?s=$SPX&p=M&st=1982-01-01&en=2007-12-31&i=p49901538714&a=115646387&r=219.png
http://www.stockcharts.com/c-sc/sc?s=$SPX&p=M&yr=8&mn=6&dy=0&i=p79217076829&a=115792957&r=363.png
Nasdaq closed at 2701.50 which is a new monthly high even though it didn't trade above 2725.
It corrected 12% H/L during 7/19-8/16 correction and is now coming off from IT bottom with weekly price momentum turning positive.
Breaking above 2725 as SPX breaks above 1555 targeting 3131.
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NASDAQ Target 3131:
Breakout from Jan 2004 to 50% retracement of Mar 2000 5132.52 - Oct 2002 is targeting Nasdaq 3000 +/- which is 50% RT of the correction.
The Jul 2007 top 2724 is 38% RT of the Mar 2000 – Oct 2002 1108.49 correction, and now Nasdaq is bounced off from the Mar 2007 2531.42 top breakout support.
The Jan 2005 break out from Jan 2004 top 2152.12 is failed, however, it again attempted the breakout 2219.91 in Aug 2005. However, it is again failed the second attempt; nevertheless, it formed higher/high price actions which subsequently traded to 2375.45 Apr 2006 top followed by Apr-Jul 2006 correction.
Price actions during Jan 2004 – Apr 2006 is a consolidation period of Feb 2003 – Jan 2004 price actions.
The Jan 2005 breakout attempt which was subsequently succeeded is targeting Nasdaq 3155 +/-. The Jan 2005 breakout attempt is technically consistent with “initial breakout attempt” is usually resolved in actual breakout.
Aug 2007 bottoming process with Mar 2007 low breakout support is consistent with the technical price pattern which a series of breakouts with higher/high price actions targeting 3155 +/- from Jan 2004 breakout.
http://www.stockcharts.com/c-sc/sc?s=$COMPQ&p=M&st=1995-01-01&en=2007-12-31&i=p37991314951&a=88255139&r=659.png
http://www.stockcharts.com/c-sc/sc?s=$COMPQ&p=M&yr=5&mn=10&dy=0&i=p80777978966&a=115744406&r=317.png
http://www.stockcharts.com/c-sc/sc?s=$COMPQ&p=M&yr=5&mn=10&dy=0&i=p80777978966&a=115744406&r=317.png
Edited by Trend-Signals, 02 November 2007 - 10:54 PM.
