Equity markets saw constructive strong gains today, even the closing hour showed some renewed strength. The 5 week wave'1 is now complete, wave'2 UP has begun. The only issue is how high..and how long does it last?
IWM, daily, bearish
Sp' daily bearish 4-month
Anyone who was short at today's open should have got stopped out at the open. Despite the somewhat choppy open (which it was especially for the Rus'2000 index), markets built on gains..and kept building.
I did notice the bullish engulfing candle on IWM yesterday, but considering the smaller cycles, it was just not good enough for me to stay long - so I had bailed index longs at sp'1284 (entry was 1269) - which right now, seems a long way down!
The Count - looking ahead into end June/July
I'm looking to re-short around sp'1350/60 towards the end of next week. Its possible the market might be pleased with the Greek election results..so...there is certainly some risk for anyone who is short ahead of next weekend. I'll try to keep an open mind nearer the time.
*As for me, I'm sitting it out, at least until after Bernanke tomorrow morning.
If wave'1 has completed (surely yes!), then we're in wave'2. I see strong resistance in the 1350/60 zone. I guess we could go as high as 1370/80, but I just think that's a little too high for this market to go.
If market does max out by the end of next week, I will be looking for sp'1150/00 sometime in July. That is of course a bold prediction, but hey...I'm a Permabear...and a Doomster at that ;)
A little more...later.