friday update -- MrSwing

You Are Here: Home > Articles > Commentary > friday update

friday update
Oct 11, 2008

Tony

ELLIOTT WAVE LIVES ON
More articles

Font Size:

SHORT TERM: market finds supports at SPX 848 pivot in wild day, DOW -128

Overnight the Asian markets were drastically lower. Europe opened lower and closed down 7.9%. US index futures remained under extreme pressure overnight and stayed lower heading into the opening. At 8:30 the trade deficit was reported to be slightly lower at $59.1 bln and import prices dropped 3.0%. Fear of a total meltdown, however, took middle stage as the market gapped down to SPX 840 in the first few minutes of trading. It closed at SPX 910 yesterday. Finding support at the 848 pivot the market rallied in the next half hour to SPX 919, slightly positive on the day. But the rally failed, and a stair step decline followed back to the lows of the day by 2:00. When the results of the LEH CDS settlement were announced, the market soared. By 3:30 it rallied to SPX 937, right at the short term 935 pivot. Again the rally faded but the market managed to close without too much damage on the day. If you are trading this market you have nerves of steel. For the day the SPX/DOW were down 1.30%, and the NDX/NAZ were mixed. The techs continue to display relative strength. Bonds were down 8 ticks, Crude slid $5.75, Gold dropped $35.50, and the Euro was lower. Short term momentum was extremely oversold, and ended the day at neutral. The near term indicators remain extremely oversold.

At todays low the SPX had retraced 91% of the 2002-2007 bull market. It was also down 47% from the highs, after dropping 18.2% just this week. The DOW also dropped 18.2% this week, and the NDX/NAZ lost 14.5%. This downtrend from the SPX 1313 high in august has been relentless on the downside. Hope all of you have faired well.

MEDIUM TERM: downtrend again makes new lows to SPX 840

LONG TERM: bear market continues

CHARTS: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987