LunaticTrader

Investing with the Moon

Outlook October 4

Posted by Danny on October 4, 2010

We see how the market tried to continue upwards last week, but the move is bumping against the indicated resistance levels. The S&P 500 briefly rose to 1157 on Thursday, only to sell off almost 2% immediately.

Going forward we remain in Green Period this week, pointing to an upward bias, but the question is: how much is left in the tank here?

Here is the updated S&P 500 chart, zoomed in on the more recent action (click for larger image):

We see the double resistance near 1160, and support comes from the recent up trendline, currently near 1140.
It is very similar to the situation we had in early August.
Given the ongoing Green Period, I think we can try the upside once more this week.
But if the move stalls again near the 1160 level, then we will probably turn down and fall back towards 1100-1120 in the next Red Period.
So I would use any strength this week to take profits and get positioned for the upcoming Red Period. This has been an impressive run since early September, but it cannot go on forever.

We have several Lunar cycle extremes coming together on Wednesday and Thursday, it wouldn’t surprise me if that marks the start for a reversal.

Good Luck, Danny

2 Responses to “Outlook October 4”

  1. nicole said

    can you give an update for EURUSD? is it a good time short it yet?
    thanks

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