hctv presents mythbusters monday, page-5

Really difficult today because on my calculations the SPX has completed another little block of five micro waves but goodness me it is getting so hard to decide where one ends and another begins. And does it still want to do one more set. Mentioned on Friday that a lot of bells start to ring in the 1400/1420. My first impression after Friday’s trading was that that was a top but after a weekend of looking at charts and agonising over these blessed waves, I’m not so sure.

Looking at Apple, it left a nice doji candle on Friday (indecision) while IBM had a black filled candle – buyers regret - so neither of them looked all that flash.

Copper still having lower highs whereas the SPX has higher highs. Shanghai Deliverable stocks still rising whereas LME stocks are falling. Very confusing.

Shanghai – we all had a shock last week when the Shanghai index came off sharply but looking at the longer term chart, I wonder if it might be making the right shoulder of a head and shoulders bottom with a slightly downsloping neckline.

One thing that is interesting is whether the XJO can push out the top of this sideways pattern. I cannot believe that the market will pass up such a chance with so many people watching this area. Could it run up a bit and allow the “smarties” (whoever they are) to unload a bit more stock and then come back and break downside. Strikes me that it is just the type of thing that markets like to do.

So I’m taking a fairly cautious attitude until it all becomes clearer. A correction would be welcome so that we can try and work out where we are again in the cycle. I still favour higher prices ultimately but as pointed out before, it is the first time that it is possible to paint a bearish picture since the October low so I must keep that in mind as well.