November 19th, 2008
There’s not much to add today. The S&P 500 held the support trendline, average daily volume seems to have stabilized and the volume on up days exceeds down-day volumes leading to a slight flattening of the OBV. The moving averages are dropping more steeply now as expected in some of the earlier charts I showed. Nothing material can happen in our view of the prevailing trend (the MTI doesn’t issue an “all-clear”) until there’s a major change in the ranking array of the moving averages and the Index.
In the meanwhile, we can try some speculative trades in the index ETFs. As I indicated in my Twit on the right, all the action seems to be taking place in the final hour to half hour. Yesterday it was a precipitous decline, today it was a nice recovery …. all in the final hour of trading. Most importantly, the support level held.
I’m hoping for a significant rally starting sometime in the remainder of the week or early next week which could carry the market up, hopefully, to 1000, or about 16%. If it does, it could paint the next leg of the “Fairy Tale with a Happy Ending”. Here’s the chart from that post: