16 Mar 2016 - Open Minded

The recent moves the past few days was your typical overlapping corrective move.  So, it goes to show that regardless of my observations that markets would fail to make a higher high, that in the end indicators prevailed.  I tweeted today that base on the zigzagging nature we would not see a new high, but that the FED might re-work that bias.  I can never say that I am absolute in my thinking or analysis, and how can I? I'm not smarter than the market.  What we do here is to increase our odds and lessen the risk involved.  Without this mindset, I would have never entertained an idea a friend gave me today that saw me looking at trading the same strategy but with a clever tweek.  So I cannot stress enough the idea of an open mind in this profession.

While the SPX moved back above the 200 day, the divergence in the daily chart still exist, and this might be a hint of the next move.  We know that not all divergence do come to fruition, but we would need it to play out and nullify itself from the equation.  The uptrend wedge I have drawn is still respected by price and is now closing in on the 2035-2040 area many cycle analysts are targeting.  Aside from that, we have the .786 ret. near the 2050.  These targets puts the index at extremes, and either it breaks out or fails hard.

In my assessment of the patterns, a slide would only occur once we can confirm a break of the 1970 level which is drawn in Green dotted line.  It is a far drop for a confirmation, but again we are not looking for an absolute top or bottom, but to get the majority of the run, just like the last UP signal from the ST.

SEN: Bearish (closing in on Bullish trigger)
ST: UP
PA: UP