Little has changed in the overall picture since my post of last Friday morning. An uptrending day moved the cash S&P500 right to the mentioned Gann target of 876. “Price Pulse (PP) Theory” continues on a “buy” signal unless the Beta – Z trendline (at 849.52 today) is violated (see chart from last Friday). As before, I refuse to get too bearish until I see a break in the price pulse trend, which right now requires a dip below 835.58.
Today’s chart shows that a TD (Tom DeMark) Combo “sell” signal has been reached! This indicator was developed to show when price exhaustion has been reached within a move; in this case it comes within our Elliott Diagonal Triangle (wedge) pattern. Aggressive traders can go short with appropriate stops (890.39 if you add Friday’s true range to Friday’s high). More conservative traders can use other entry techniques. For instance, TD Camouflage, TD Clop, TD Clopwin, TD Open and TD Trap have not yet generated sell signals yet.
The chart also shows the two most current Level 1 TD Lines. The supply line (in red) was broken but not qualified. The demand line (in green) sits at 845.59 and will be qualified if broken today. Breaking this demand line would be one place to go short. The target price on a break calculates out to 812.22. Finally, please note the DeMark REI indicator is still on a sell (generated last Tuesday; the stop loss being 883.27 which has not been hit yet).
Let’s see if we start down today.
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