It plays out faster in your mind

One problem I always have is that the "waves" of market action always play out faster in my mind than they do in the market.

Although yesterday's action negated the negative RSI reversal that was pointing to a retest of the low, the secondary/confirming momentum indicator is lagging price action and the RSI even more this morning. A sell signal? No, price must first turn down to cement in that signal but it is hinting that a top is near -- as is my timing work.

On the daily chart, the long moving average I watch is at 1499.20. 1503 is 315 degrees up from the low (Gann). On the weekly chart the short moving average sits at 1491.56. It was interesting that after moving above that line yesterday the market failed to close above it.

Finally, the August 8 high of 1503.89 is good chart resistance. This combo of resistance, timing and a lagging secondary momentum indicator may be pointing to yesterday’s high as the peak of the current wave up from August 16. If so I would favor it being the “C” wave of a contracting triangle from the August 6 low.

But I caution myself: the waves take longer to play out in the market than in my mind. Wait for the proof.