Will the stock market confirm the bullish scenario, or the bearish scenario? I've been posting up the views of analysts who show both cases including the levels at which one (the bullish case) would confirm -- levels being tested this week obviously. There are some people who view today, Sept. 8, as being a turn date (based on the moon, or Gann, or something). Maybe! Hey, maybe it's even related to this news about two asteroids passing close to the Earth - after all, this stuff is supposed to increase as the Earth passes through the median of the Milky Way in 2012 ...!Close Call: Two Asteroids Passing Earth Today=============
ABC News - 09/08/2010
Today is not a good day for the anxious among us. Two small asteroids -- two in twelve hours -- are passing the earth, both coming within the moon's orbit, one of them whipping by about 49000 miles away. [see their picture above right - bigger version is with the article]
Well I don't have significant theories to present about that, but I will point out a few things. One, as I tweeted earlier today, not only is the market testing Andre Gratian's trendline that he showed and discussed in his Market Turning Points weekend update (which I posted here last night), but it's also on the precipice of a time window in the T Theory (tm) updates of Terry Laundry on Sunday (which I posted here, I believe on Monday or maybe it was Tuesday morning) (and you can see and hear Terry's Wednesday morning update about that this morning, at his T Theory™ Daily Updates, Forecasts, Charts and Data webpage. Also, there are competing "head and shoulders" theories floating around - one's bullish, and one's bearish. I marked both of them on my weekly S&P 500 ($SPX) chart (middle chart below). Well, okay, there's also that one fellow who's talking about a bearish head and shoulders on the yearly charts (McHugh - come to think of it, he may be joined by the Elliott Wave Int'l folks in that viewpoint, too), but we don't need to go there.
From the Fibonacci perspective, I'll say that the height reached on Friday and retested today is around the .618 rebound up from the lows of a couple weeks ago, and I've encircled that on the daily $SPX chart (first chart below). So if anyone wants to count this as a wave two up before a wave 3 down, this Fib level is one to consider ... even if you're not wave counting that way, it's still a significant Fibonacci retracement level. For that matter, on the monthly chart (third chart, at bottom below), the 50% retracement of the entire drop is around the 1120-ish area in the $SPX. I believe this is one of the reasons why there's resistance in the area up by 1120 and we don't even need the index to get up to that number in order for it to be repelled by that Fibonacci resistance. What I'm saying is, that the market shot up to the .618 retrace area on the monthly chart, then dropped back to the .50 retrace, then fell under it when it went down testing 1040 and even 1018. It's popped up again (to that daily chart .618 retrace area), but may not be able to regain the monthly chart's .50 retrace area around 1120-ish. That could be a factor that would bring out the bearish head-and-shoulders scenario and the bearish T in Terry Laundry's T Theory (tm) possibilities.
As for indicators - I've marked them to remind us all to keep an eye on them. Frankly there's enough inconsistency between the daily, weekly and monthly charts that one could argue them either way depending on one's bullish or bearish point of view. We'll let the market levels do the decision-making for us! At this point I am tempted to lead skeptical and defensive, unless the market shows that it really can make a breakout. Maybe I just like the idea that Raymond Merriman talked about in his recent weekly previous about Mercury pulling a fast one! But if the market does show that it can break out from these levels then I'll get on board with it too. Until then ... we'll see!
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