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Friday, January 22, 2010

January 21st 2010 in charts

January 21st was pretty anti-climatic for me. I feel almost silly for looking for market reversal since SPX hit about 930. Assuming the recent high of SPX 1150 holds, I was only off 23.6% from the market top! :) Ok, just a tad bit too early. Unfortunately for me, I repeated history from myself. In August 2006 I started to short stocks thinking the market would start to reverse in 2007, only to be a full year too early.

Back at SPX 930 I was so sure what was in store for the market next. After witnessing the greatest Bull market comeback in US stock market history, a 72% gain in the S&P 500 in about 10 months, I am not as sure. One thing I am looking at is what I discussed in post on Catastrophic Wave C, if you haven't read that post please click. I am NOT certain that charting has any merit yet. My biggest concern is the impact charting has at investment corporations around the world.

But Wednesday the 21st WAS a major day, it signaled a break in the bull trend line dating back to March 2009. Maybe the correction we just witnessed is it, and another 10 month gain resumes, but I do doubt that. When the S&P 500 breaks to a new high, I may start having to rethink were this is all going. But for now I'll take it day by day assuming the market direction overall is lower.

I strongly recommend anyone long to look at their positions and set stop-limits now. I won't preach what level, because maybe the market resumes the advance. But if it doesn't, and the decent resumes, you need to cut your losses. (or keep profits) I am speaking from experience, since I sold my longs at 930 and starting to short...24% too early!

For your reading pleasure, the US stock market in charts, and a big bear at the end of this post to signify the Bear has come out once again. How long is yet to be seen, but a sleeping bear for 10 months may be a bit hungry.

From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

From WebSurfinMurf's Financial Blog

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