EW and RSI

First off I will be out of the country until January 20th.... I still will be able to post at night, however it may not be everyday... I would suggest to read through the old post, because most likely nothing will change.

How does EW tie in with indicators, like I mentioned on my last post? Well lets discuss this in further detail. First off since I am not an EW expert I asked Pugridiron for the count from Nov 1st to Nov 16th on the SPX. The rest of the counts are my own. Now do not get stuck on these counts. The key is how the RSI shows us where we are at in EW and etc. Please see the attached chart and look at the count on the RSI and then on the price movement and you should see the relationship. Why do I bring this up? Because we will soon find out where we are at on the current move based on the RSI movement. And you can determine trends based on indicators and a little EW with out getting the counts right. The key is to determine where you are at in the current trend and etc.

SPX 30 min

January 8, 2009

It appears I was one day ahead, today we got the breakout I was looking for. Look for it to continue Monday morning. Watch the RSI again, when it gets to 75 area this move is done... You will here me talk about this RSI stuff allot? Do I rely on it allot? Not usually however, it a round about way it is my EW count.... What? Yeah, look back at the end of every impulse move and you will see the RSI topping out above 70 or 80 depending on if 15, 30, 60, min charts and for corrections usually under 20... So since we all agree we are topping out the RSI is key here. Especially on the daily... In the middle of an impulse move or correction this would not be true, usually this is when we see the divergence and convergence of the RSI.. Other indicators do the same thing... I just think the RSI is the one that sticks out the most.

Long Term - Same... Really watch the daily RSI... Some reason 1175 is starting to look like the top, unless we keep this really slow stair step up.. Then maybe 1200 Feb 1st?

Short Term - Monday should finish out this move to 1150 area... Then look for a pullback to 1130 to 1135 before we make another run up to 1175 (Jan 15th?)...

Trading advice/opinion - Long term I would add short position in 20% portions above 1150 for a March 31st target. Short term if not in I would wait until mid next week (pullback 1130 to 1135) and jump in for the ride to 1175?



60 min SPX - this is just showing us that we have seen this move before... So what is next? Up day monday then minor pullback... Watch that RSI.

30 min gann- still following that gann line up... once that 60 min RSI tops what for those to circles points indicated for pullback targets (1132 Jan12th and 1135 Jan 13th).

Daily SPX - Really need to watch this RSI close. We are getting close to that 70 mark... One or 2 big moves and we will get there fast... However looks like we are going to stair step our way up so should take a few weeks.

January 7th, 2010

Well I didn't get my 10 points today, however we appear to be setup for a move tomorrow that should take us to 1150... Once we get to 1150 I think we will pullback to 1130 around jan 11th (monday) and then head back up to hit my target of 1175 on Jan 14th or 15th...

Long Term - Same top out around 1175 or 1200 (watch RSI on daily), then major pullback.

Short Term - See above... Pretty much stated what I think short term.

Trading Advice/Opinions - I would wait until that 1130 or lower to add a long position for the ride to 1175 or 1200 next week. I wouldn't play short here, because the bulls have this market. Longer term plays I would short above 1150 with a time frame of March 31st...

30 min gann - I think the gann chart has been extremly strong. Look at this chart very closely. Once we get to 1150 or top out tomorrow, this chart will help us point to a pullback area. I think around 1130 on Jan 11th looks good... Maybe 1125.

60 min SPX - Looks like we started the up move today, but it started late in the day. So tomorrow should be exciting. Watch that RSI, above 70 we are very close to the top on this move (1150)...

Daily SPX - Looks like I finally got my confirmation that we are definetly going to 1175 and maybe 1200. What? That RSI breaking that divergence trend.... Now the question is when is this up move over? That RSI will tell us, when we get over 70 and close to 75 we are done, and time to load up on a short position.

January 6th 2010 Update

Well today I went back to some old school technical analysis. Some may say I am crazy or that can't be right.... But I just read the charts.. The most important thing that people over look allot is that stocks usually act or repeat the same movement during the current trend. So saying that look at the 60 min.

Long Term - nothing has changed - just need to watch the daily RSI - 70 to 75 on daily RSI then we start a major pullback

Short Term - Key here is the 60 min SPX below... Look for that same pattern, which gives me a good handle on the upcoming movement. I think tomorrow you will see a 10+ point move up and continue up some on open Friday.. The question is 1150 or does the new volume push us up straight to 1175? Once the RSI on the 60 min gets to 75 then this move is over and next move will be a minor pullback to 1130 area..

Trade Advice/Opinion - Pretty much the same... when the RSI on the 60 min tops at 75 then a short position with a target of 1130 would be in play.

60 min SPX - Old school techincals here.... Keys watch RSI (75 and this up move is done), pullback 1130 (watch major trendline, if breaks then we are going lower).

Daily - RSI should break out to the top side soon. Need to get to 70 or 75 on the RSI before the big pullback... Question is 1175 or 1200.
30 min gann - We are following that gann line straight up... Move the pullback based on todays move.... Jan 13th 1130 pullback?

January 5th 2010 Update

Well today we got what I wanted to see. I wanted to see us break thru the top of that local triangle and close at that level. And that is exactly what we did today.. This is a bullish signal to me.

Long Term - hasn't changed (see below)

Short Term - Stays the same also, however I wouldn't be surprised if we get a gap and run up tomorrow..... To me we are set up perfect for that... However pullback to 1125 first is still on the plate.

Trade advice/opinion - Stays pretty much the same, expect I am more confident on the upside here since we broke and closed to the topside of the local triangle.

SPX 30 min - Shows breakout and close above local triangle... Also RSI, Stochastics and MACD all telling me that tomorrow is a bull day...

30 min SPX Gann- Yesterday I posted that the middle black gann line would come into play... Well look at it now? We are bascially following that line up... However I think the top black line may come into play soon if not tomorrow. Do we gap and run to it? I think we do, maybe not tomorrow but soon. Note: pullback at 1125 (gann lines) could still be in play...


SPX Daily - Key here is the RSI again... If we get a gap up tomorrow we break that trendline and watch out, up we go... Still want to see that confirmation..!

January 5th 2010 1:03 cst

Below is an updated chart of the 30 min SPX.
Key points:
1) break out above local triangle - close today above the trenline will be extremely bullish
2) Notice the stochastics are becoming overbought and we made a new high and staying near this high. This is extremely bullish..

Thoughts - everything still points to 1175...

January 4 2010 Update

Long Term - Well it looks like we are on our way to 1175 or 1200 by mid to late january.. After we make it to that level we should begin a major pullback getting us to below 1000 by end of the first quarter.

Short term - We need to watch to confirm a breakout of the local triangle we are in... Based on indicators and gann I think we hold this level and slowly stair step up follow the gann line on the 30 min gann chart...

Trading Advice/opinion - Since we are at this key level and could potential pullback to 1120 to 1125 i would watch the open tomorrow and if opens strong I would add a 20% entry long and add on pullbacks (if pullback happens). If opens a little weak I would wait and add at or under 1125... Long term I would add short positions on highs 1150+ in increments with a target of end of first quarter... GL

Daily SPX - shows target on top to be reach by jan 14th. Also watch the RSI to breakout of trendline to confirm this impulse move up.

Daily Gann shows target of 1175 on Jan 15th and 1200 around Feb 1st.

60 min SPX - Shows the local triangle that we need to break out of... Should happen soon.. middle fork will come back into play soon.

60 min gann - shows target with when we will hit the targets... watch black dotted lines for these targets.

30 min gann - watch gann line I mentioned on the short term prediction...