Outlook October 11
Posted by Danny on October 11, 2010
Markets behaved as expected, trying to push higher but bumping into overhead resistance levels (11000 on Dow Jones Industrials, 2400 on the Nasdaq, 1165 on S&P500).
The recent Green Period has added 20 points on the Nasdaq, so we can see that the upward momentum has weakened.
Going into a Red Period, the odds now favor a pullback over the next couple of weeks.
With the market up more than 10% over the last 6 weeks, we could easily get a sizable correction.
So be cautious and ready for it.
Danny
LunaticTrader 
vinod said
Danny,
i always respect your opinion. in today posting you mentioned Red period coming on for couple of weeks; is it true ??? or just interpreted erroneously?
will you please expand on this if possible and as always we thank you for your wisdom.
vinod
Yash said
Danny’s red period started on 11th and will go for 2 weeks is what it means.
Danny said
Indeed, Red Period typically starts 3 or 4 days after a New Moon.
We got a New Moon last Thursday, so you can do the math.
Yesterday there was also a geomagnetic storm. (see https://lunatictrader.com/?Geomagnetic_Storms
This can add to downside pressure on stocks over the next 6 days.
Danny
vinod said
Danny,
Good morning,
thanks for your insight into the markets and your timely advice.
you mentioned about Geomagnetic storms also and i see there extreme exuberance in the all overseas and local usa markets too.
i was just wondering is any time that happens instead of markets correcting going up when it should not???
please advise if you can.
thanks again,
vinod
Danny said
Hi Vinod,
I am not sure what your question is, Vinod.
When you have a one-way market, like we see in the recent weeks, then the normal patterns and things like geomagnetic storms will not stop it.
Danny
jason said
Thanks for the weekly post Danny.