Do you see what I see?

This one goes out to Stevo and to the folks at Evil Speculator (molecool, springheel, and kiersten especially). This is my first public attempt at analysis - feel free to humiliate me as long as you teach me something in the process.

And please excuse the clutter - I'm still experimenting with the tools and figuring out what works best for my style of trading. Also be aware that my candlesticks are setup different from what is normal - green/red is the daily move, open/closed is the net change.

The basic story I'm reading is that we've got a set of channels which we're transitioning between. It's kind of a rounded top formation from the looks of it.



The inflection points should be clearer here on the hourly chart - if we don't break above the bottom of the blue channel we're going to chop around the VWAP in the orange one. If we do break back into the blue channel it's clear sailing up to 1020 or so on the S&P500 - which lines up quite nicely with molecool's target for the next elliot wave up. I'm still studying EW theory but I think seeing how these connections happen will be instructive.




Finally - here's my view from 10,000 feet that I like to refer to. Many technicals, as well as a lot of sentiment are pointing out that the rally has run out of steam. Whether we get a new rally full of its own steam or a large-ish correction is still up in the air, but should become clearer within the next week or so. We're out of that purple monster channel from the daily chart, and macro technical analysis seems to be working again. If we stay in the orange channel for a long time it may be a good idea to dust off the old stochastics again.


A final note of interest - looking at the daily chart, the trend lately has been for the Permanent Open Market Operation days to actually be down intraday until the ramp up in the close and into the following day. I'm going to experiment with going short and levered on the close of the day preceding the POMO, and putting on a tight trailing stop on late that morning.