sp'weekly
sp'weekly2, rainbow
Summary
So, we have a blue candle on the rainbow chart, and this remains a provisional early warning of downside trouble.
What is clearly apparent from the weekly charts is the importance of the 1425/30 zone. If we do manage to break into the 1440s, then the bears are right back to square one.
'Santa' remains the wild card, although as many recognise, he doesn't always deliver every year, interestingly in Christmas 2007 - when so few realised we were in recession, Santa failed to show up, and the market declined significantly all the way into January.
A brief reminder on my overall outlook...
sp'monthly3b - count
The above is a fair summary of what I believe is very viable across the next 3-4 months. It is very analogous to the 2007 initial decline, and I have indeed seen the same kind of outlook projected by other chartists.
What remains critical for the bears is we take out the June 1266 low. If that is achieved, then the much bigger 'doomer scenario' is on the table.
Looking ahead
Wednesday will be kinda interesting to watch. We have just one piece of econ-data at 10am - new home sales, and the Fed Beige book at 2pm. I think both could be used as dumb excuses by Mr Market to rally back, and break through the soft resistance around sp'1410.
If we see prices of 1411 or higher at any time, it should ensure that 1425 will be hit within 5-10 trading hours.
*special note, I'm aware that CNBC plan to wheel out billionaire Warren Buffett on their breakfast show, and so we can expect that clown station to be replaying his comments ALL day. We've seen this kind of nonsense before, and usually, the market is UP on such days.
I remain waiting to re-short @ sp'1425, which I believe could be hit this Thursday.
Goodnight from London