Market literally pulled back 1 min after FOMC

Kind of expected the day after but that shows how much dislike the market is with the Fed's 25 basis point cut. Now the reverse H&S is broken and come to think of it, the right shoulder was kind of in a hurry. The market was at OB before FOMC and never understood why people would still buy going into the meeting. This is Oct31 all over again, the Fed still worried about inflation and hinting no more rate cut and this will put a damper on the market. The highs of Oct11, 31 and Dec11 form a resistance line which is stopping the advance of the market. The original forecasted 710 was good and it is always important to realise the market will reverse in between 61.8 to 78 Fib retracement. Today is approx 0.38 retraced from the rise from Nov26 and is sitting on forecasted value of 690. If the uptrend is strong it may bounce tomorrow, however, right now with the market sentiment, there is no reason to believe that it will change overnight. A conservative target would be 50% which takes us to 680 and tomorrow's numbers are 705, 698, 684 and therefore, if it continues downward somewhere around 680 to 684 sounds right. But then again the brokers will be coming out with earnings this week and may be they will lead us further down. Was waiting for the infamous FOMC 1,2,3 pattern to realise today before shorting but shorted the market anyways when the pattern failed.

More thoughts tonight....could not help but thinking about the weekly OEX chart which is forming a H&S right shoulder. The left shoulder started from Aug13 this year. Now if this H&S materialised the neckline is 676 and the projected target will be OEX 58 points down from 676 taking the market to OEX 618 which is lower than 624 of March 12 this year and this is what Bradley Model is predicting by Dec 22, only 10 days from now. A drop of 72 OEX points and DOW 1440 points to DOW 12000. Just dream on for now...


2c

FOMC

no pullback yet, so it looks like one of those times that pulls back after FOMC. Tomorrow's numbers are 709, 705 and 703. Played gold stock calls last Friday and sold today.

2c

Not surprised to see a pull back here

Now price and volatility at opposite extremes again. Expect a pull back to 695 the worst case. Monday's numbers are 703, 702 and 700. Still in uptrend pending FOMC of course. Have a good weekend.

2c

Who says market does not go up in a straight line

Well, nothing more to add. Tomorrow employment report and numbers are 707, 699 and 695. Now be watchful of the fact that every time the market goes out from its norm for more than 15-20 points, a pull back is expected soon.

Oh boy! Forgot the inverse H&S. This is huge and 35 points back up to old high 725. Hold all longs.

2c

A confirmed buy signal...yes

How about that! one day is confirmed sell the next is confirmed buy. The worst nightmare came true this morning. Comparing chart pattern, today was like Aug29. It flipped right back. Lucky only 1/3 of puts were reentered last night and was scrambling to get rid of them this morning. As it turned out with doubling on calls, it was a winning day today nevertheless.

Technically, it exploded past 690 and up trend was firmly anchored. Well, the good news today were, higher productivity, non-inflationary unit cost of production, and in addition bigger than expected crude draw down led to the oil rally. The Santa rally is here with FOMC next week and worldwide rate cuts. The only down side may be Friday's job number. The ADP report forecasted a higher than expected increase and basically saying what recession??
In any case, no shorting please if you want to stay alive in the market, and buy on the dip until otherwise. Further, volatility indicator has shown a trend change again today which means up ...Tomorrow's numbers are 697, 690, and 686 and the near term target of course is fib 61% which leads us to 710.

2c

A confirmed sell signal...but

if it were below 680 then no questions need be raised. However, since the market has made its first step into an up trend and comparing August 28, it could flip right back. But the economic condition was different then. The glimmer of hope from FOMC next week probably helps to slow the speed of the decline. Could not help but took profits at the open then reentered Puts later. Tomorrow watch 685, 684 and 681. If it closes below 680 especially 676 we are looking at closing the gap.

2c

Remain short

nothing more to add...except watch out for Fib 0.38 at 680 and 0.5 at 675....watch 690, 688 and 684 tomorrow....

2c