THE DOT - if this turns orange or red be alert

Friday, June 25, 2010

part 2

3. Crash warning signs are gathering like a storm from the inevitable death cross which will happen soon to price patterns like a triangle pattern which gives a 250 points downside for the NDX below 1780 - target 1500. Astrology gives a clear probability of 75% for a 15-25% drop from current levels within the next 3 months. That is the point I disagree with McLaren about until Sep we have a very high risk of another mini-crash.

excerpt 1

Watch S&P for 'Crash' Warning Pattern: Charts

Published: Friday, 25 Jun 2010 | 5:39 AM ET

The next couple of trading sessions could spell disaster for the S&P 500 and investors should watch the index very closely for early warning signs of a crash, technical analyst and independent trader Bill McLaren told CNBC Friday.

"If the index goes to 1,040 and only bounces one day and the next day goes to a new low, be very careful because the time cycles in that pattern indicate there could be a crash scenario," McLarer said. "I doubt it, but if it occurs, look out."

The S&P [.SPX 1072.50 -1.19 (-0.11%) ] closed 1.7 percent lower Thursday at 1,073.69 points after a late-session selloff dented the index. It has now seen four straight days of declines.

"The manner in which we got down has me really cautious. We had a large gap down, followed by follow-through, that's not a very pretty picture," McLaren said.

"I'd like to see the market hold in here today and then rally into September," he added.

Even though there is a risk of a severe decline, McLaren expects stocks to remain range-bound in the near term.

excerpt 2

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