Wednesday, January 16, 2013

Charts 01-16: Another week in the wedge

The wedge shape of an ending-diagonal is taking shape, and it looks like the 3rd wave of the move is in.

For wave 4, a pullback to the .382 at 1445 would work, especially if we can get the A and B waves tomorrow, with C on Friday.  C might be the large move that the small change in the McClellan yesterday would produce.

SPX 1445 would also give us the slight W1/W4 overlap we want to see on an ending-diagonal triangle pattern, indicating an underlying weakness in the overall move.

The upper Bollinger on the weekly SPX is 1483 -- we'll watch it carefully next week, as it is a good target for a topping candle here.

SPX 01-16
A drop into January opex, followed by a rally to new highs would also bring in the lower Bollinger for the VIX, setting up a VIX buy signal late next week where we can close a candle down in the 12s, outside the lower Bollinger.  That would be a useful indicator here, a nice-to-have.

VIX 1Y daily

Posted by at

3 comments:

bmihogh said...

Well, I think some of your previous month-based charts were better, the weekly Bollinger is simply too weak to initiate/predict such moves.

And IMHO it won't be so clean... It's always a dirty work at the end...

January 17, 2013 at 12:01 AM
christiangustafson said...

Just look at the /ES fly this morning, we're set to crush 1474 at the open.

If they can't get it done during RTH, there is always the overnight futures.

January 17, 2013 at 5:45 AM
christiangustafson said...

LOL the other option with this VIX chart is that we go chase that bottom Bollinger down in the 9s ...

UVXY getting destroyed again this morning, what a disaster for trapped longs.

January 17, 2013 at 5:53 AM

Post a Comment

Subscribe to: Post Comments (Atom)