Tuesday, April 7, 2009
As expected the SPX had a hard time at the channel resistance at 845/50 for now as we also have reached overbought levels. Its interesting too see so many 'smart' people showing up now in the media calling a top or expensive level. I do agree we are close to the end of wave A and a pullback is due starting very likely after mid April as we go into a volatile earnings season. The matter of fact is though that sentiment overall is not very bullish now ( not as at the highs after the Nov. rally). The calls by many for an end of this rally is part of that plus I rather want to see a close below 40 in the VIX as well. Interestingly we could see a false break out in the SPX towards 860 before turning down as some banks will report good numbers next week and drive a brief final leg up. That will trigger the turning point as we have in the DOW chart some margin left to 8250 and for the NDX at 1340 before turning down. We are now in week 5 which is basically a corrective week in my observation.
Posted by getagrip at 9:02 AM