I decided to take a close look at the charts yesterday afternoon, and low & behold the $RUT had just completed a broadening triangle pattern in wave e/4. $SOX was already rallying off support, and closed green. This morning we see futures red, pulling back after yesterdays reversal.
Wave 5 is a wave most bears will fight all the way up, so let's make it count!
I want to see every last retail bear - except those who follow this blog - to capitulate. Once the price action breaks above the top of the pattern, start preparing for the worst.
I can't say for sure that the correction is over in the broader market, and the trend in financials is broken.
Financials: Trend looks broken
I updated the charts of doom this morning and see the SHTF as soon as March 15th, which is when the debt ceiling is locked in, OPEX, The Fed, St Patrick's Day, and the vernal equinox on the 20th. Expect a re-balancing, going into Q1 window dressing. I'm even recommending folks hoard some cash, because there's a good chance of a bank holiday, when the SHTF.
Much watch: One of the top data miners sees much the same thing I'm seeing, in his analysis, I'm not seeing Silver, or Gold breaking out, but if Silver does break out of the right shoulder again, that could lead to an upside surprise.
$GDX - This is the most bullish view on miners I have. Not claiming it's correct, but a powerful wave E is a possibility.
Canada appears to already be in a bear market, so we'll be watching the $TSX over the next few days.
That's about all the time I have this morning.
Dow: 30 minute chart support
$SPX: 5 min chart. In order for short term traders to get really bullish the price action needs to crawl back into the channel.
That's all the time I got this morning.
Good Luck, AA
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