3SOF

Ramsburg, what a top-notch analysis, applaud. Keep that up and I'll be a faithful subscriber to 3SOF for a long time to come. Thanks. Would love to see you post a little more often though if possible.

Excellent analysis Ramsburg. I agree completely. We may not be at the very bottom but we are far from the top. Time to start buying and get ready for the next run higher!

The increased value of the Yen today has a major effect on the Yen carry trade...Another nail in the coffin for hedge funds...I predict another down day tomorrow...I know I'm in the minority....We are closer but not close to support...

Thanks guys

This was more like a brain storming rather than a technical analysis...

I'll try to post more often, being around a lot of coding stuff since I'm also the technical department of the website

The SPX is up about 50 points since I published this Analysis last week, so it's time for a little update

Update:
The contact with the long term support has generated a very nice reaction, in just 5 sessions, the SPX crossed above the ema-200 again, and reached its short term resistance: 1460
I'm not considering an effective breakout of this resistance just yet, because with present volatility we can still witness a negative reaction at these price levels.
The Index is testing the resistance level and trying to break it, but it would be normal a 20 or 30 points drop at this point and before an effective breakout, since a lot of traders know this price mark and there is some selling pressure here (coming from short term traders who got in near the lows and are trading key technical prices) .

Anyway, if the breakout happens soon, there are 2 other barriers worth mentioning:
1480 - Where the ema-50 stands now
1490 - The base of the upper trading range where the SPX was trading a while back

This means, that in case we watch a breakout, we should also watch a throwback soon after it happens, and in that case, we should use the 1460 as the support level and a good entry point for those missing the initial breakout.... But we haven't an effective breakout yet... so let's just wait

For the Long term, and as I stated before, I believe we are still in Bullmarket, and this big dump was just a normal correction.

Best regards !

"This big dump was just a normal correction."   

I expect big dumps may become normal in the next 6 months...

The markets are breaking the downtrend.

Quote from: stout7735 on August 24, 2007, 03:22:20 AM
"This big dump was just a normal correction."   

I expect big dumps may become normal in the next 6 months...

Can you say why ?

regards,

Just a quick update:
The breakout happened sooner than I expected... The SPX is now trading above its previous ascending support, and closed Friday's session just near the ema-50 level, more than 50% of the sell off from the highs was recovered during this pullback.
The next resistance level is located @ 1490 as stated on the previous update, followed by 1503 (the previous relative high from this swing), we should look to 1460 now as the current short term support.

Best regards,

Quote from: Ramsburg on August 27, 2007, 03:34:26 AM

Quote from: stout7735 on August 24, 2007, 03:22:20 AM
"This big dump was just a normal correction."   

I expect big dumps may become normal in the next 6 months...

Can you say why ?

regards,

Stock market corrections are normal, but they do not result in unprecedented worldwide central banks immediately  pumping hundreds of billions for "liquidity" ,nor are they usually set off by undetermined bad debts...It will take months to unravel the extent of these problem loans and who is left holding the bag...While most corrections recover in a few months, this may worsen for a few months...

Just a quick update:

Today’s session was ugly and not nice to watch, but given the recent big pullback and taking in consideration the current volatility in play, this wasn’t completely out of context. Apparently the motivation for today’s sell-off was the Fed Minutes, which didn’t brought anything new, just the same fears that pushed the markets down some weeks ago.

From a technical perspective, the recent breakout was washed away from the charts and the SPX is once again trading below the 1460 reference level and the ema-200. I guess climbing 110 points in 7 sessions without breathing was not sustainable… I was expecting a little sell-off before watching the breakout of 1460 last week, instead we have now this bigger sell-off :-(
The current layout is still compatible with an inverted H&S pattern (assuming a second shoulder is done during the next 20 points down from this spot). It’s difficult to draw short term supports with this volatility, but despite the short term, the «big picture» is still intact at this point.

Regards,

Quick Chart Update:
Yesterday's candle was an indication of strength; the SPX has quickly recovered all of Tuesday's losses (actually, the SPY closed above the body of Tuesday's candle).
The index closed above 1460, but this isn't a reference anymore, the resistance stands now at 1479 points and we can introduce a new short term support at 1432.

Regards,

Quick Update:
Yesterday session didn't have much action compared to the regular volatility we've been watching lately.  During the session there was a lot of small ups and downs, showing indecision, probably because Bernanke's speech today.

Technically speaking, I'm still looking to the 1479 level as the main upside barrier for short term quickly followed by 1490. If we watch a close above these levels, the overall technical layout will be much better, taking in consideration that the down swing would be broken to the upside and also because there is a sort of Inverted H&S pattern in play. For the downside, 1432 remains as the nearest support level, but anything its possible today, especially with a lot of ears on Bernanke's words (personally I don't think he's going to give many clues at this point), the SPX futures are up 15 points, but that means absolutely nothing

Update:

Not many developments since my last update, the SPX continues to trade inside the same range and not completing a valid signal yet, while volatility continues to be present not on the same scale compared with some weeks ago, but still giving a lot of noise and distortion to the short term view.
I’ve made some minor arrangements to the chart, updating some reference lines one could use for short term purposes. 
Above current prices I would consider the 1490 level as the main short term resistance level, followed by 1503 which is still the short term relative high (that I would consider as a level of confirmation for an upside continuation). For the downside 1440 but especially 1432 should be the main short term support, below this level I would only consider the long term ascending support (1385) and the August lows as support.
EMA-200 and EMA-50 are still working as price barriers, now forming a tighter range, during this period the SPX seems to be attracted to the inside zone between this two moving averages.

We are still half away from the August lows to the July highs, even so the long term chart remains completely intact.

In attach the updated short term chart and the chart since 2003

Best regards

Technical Setups.......