Wednesday 22 August 2012

12pm update - awaiting the Fed minutes

A bit of a choppy morning, but the underlying weakness is starting to show through. The daily momentum cycles are starting to go negative (finally!), and we have a good chance at hitting 1380/70 within 3-7 trading days.

I'd still guess we'll bounce though, not least with the Bernanke looming next Friday morning, and only then do we have the chance of something more major to the downside.

Its a tricky time to be trading this low volume nonsense, but the stop levels are at least pretty clear, short-stops 1426,  bull stops sp'1353/49.


sp'daily5


VIX, daily


Summary

Bears should seek a close under 1409, that seems reasonably likely, but if the market gets a bit moody after the Fed minutes are released later at 2pm, then a close in the 1390s is very viable.

If the latter is the case, then a hit of 1380/70 is possible by late Friday.

VIX needs to close in the 16s, as clearly seen on the daily chart.
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Lets be clear, until we're back in the 1340s, none of the doomer bears should have any confidence in any daily market declines.

More later...