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New Moon being usually a high in the market and 22 March 2012 was the perfect example that a high might have been made. It is most likely that 1414 was the high of intermediate 3 and we are now seeing a correction from last low in November 2011 at 1158.
SPX 1 Year Daily
The potential pullback should lead us to minimum 1353 and further downside potential to 1315 area.
Back in late September and early October it was mentioned here on OT that the SPX looks similar to 1998 when all the bears forecasted a new bear market.
Well, lets review the charts again
SPX 1998 - 1999
and here my update dated 27 October 2011
and here the current chart 2011 - 2012
We also know that the SPX made a new high back in 2000 and that was 2 years after everybody called a top in 1998. Bear this in mind before calling to often a top and rather look for buying opportunities when market has great oversold conditions as we had in August - October.
Light Crude Oil remains bullish and we should see more upside ahead
Light Crude Oil Monthly suggests a direction of the old high before this rally is over
Summary:
Energy Stocks are they way to go and we should see higher prices in this sector
Besides the fact that hourly is overbought and a dip is expected, the overall trend remains up as below charts will show.
The 1 Year Daily has no sell signal but is approaching slightly overbought conditions. The SPX could easily go to 1428-1440 before starting a larger pullback. The size of the pullback should be between 23 - 38% of the gains since rally 1158.
The 12 Year Monthly Chart is showing us the range of the decade old bear market. It is a sideway range and target is very obvious. Namely the upper range.
The RSI of the monthly chart is nowhere overbought and we should see more upside ahead before the monthly becomes overbought. Once the monthly chart is overbought, we should start to worry. Actually it is very easy to trade the monthly chart once the investor/trader ignores all those irritating silly bearish calls and bearish trendlines. Just follow the basic rules of the monthly chart and the trend is clear.
The Bull - Bear Indicator remains on a buy signal and does not show any bear market at all.
Summary:
The bears look like fools by calling constantly a top and looking for reasons why the market should go down instead of looking at the basic rules of a trend. They use news, currency and used coffee filters to read bearish sentiments and overbought conditions for their silly bearish view that has no basis at all.
Well, we need those silly bears to climb higher as real bull markets climb higher on the wall of worry and with low or average volume. Once the bears join the rally, the volume will rise to a climax and it is time to sell. We shall monitor any high volume days ahead as this will be the sign to exit
The target in ES 1399-1402 has been reached and my take is we see a small pullback
Hourly charts look overbought to me and it would not come to my surprise to see a dip here. That being said, the overall trend is still pointing up and hourly charts are only good for a short term trade.
A test of the 20 EMA or even 60 EMA would be normal for move and will not cause a dent of the overall trend.
