bubble highs, page-8

Here's a interesting further fact to consider re the S&P...

The rally from 6 March to 11 June was 289.44 points.

The rally from 8 July to 7 August was 148.68 points, or 51.29% of the prior rally.

The low on 17 August was 978.51 and extending that by 51.29% of 148.68 points (the prior rally) gives a 76.38 point advance now happening with the target of 1054.89.

That fits with the following retracement:

- 1/2 retrace of the range May 08 to March 09 (1053.51),

and the following extensions:

- 1/3 extension of rally 6 March to 11 June (1052.71), and

- 1/4 extension of rally 8 July to 7 August (1055.17).

So, if we get there, expect some heavy selling at 1050 to 1055. If we there, that to me seems the strongest place for a correction to begin.

.....

Back to the here and now..

The "1020 and a bit" support held up well last night and although its looking a bit shakey now 1028 and 1036 are calculated resistance levels so another day or may be two to burn through the supply here wouldn't be unexpected.

I guess it is possible to breach 1018 and still give a final thrust up into a high next week but it would be better to stay above 1018. Perhaps there could be another dumping to finish the selling at this level like at 1007. The patterns of what went on there and what's going on here are similar to me (including marginal lower high) so I guess that happening is a reasonable chance too.

It's a bit risky trading when a market is topping though. Perhaps my time would be better spent doing something else.