S&P 500 - September 30, 2009

This was a tricky trading day for many short term traders,especially the bears. Caught in between two pivots (1041, and 1061) market teased the bears by a fast drop after PMI data. It then wiped the drop clean without losing a beat. After that, it dropped again on increaing intrady volume.

Despite the intraday drama, my preferred count is still intact and will remain so as long as 1041 area holds.

This is 15-min chart


Sorry for all the lines, I purposefully left them there for the post to emphasize why I think 1041 and 1061 are technically important. The area in between looks like a 20, 30-point band of indecision and struggle, or as I like to put it: a Chop Zone.

As we zoom out, we still see the same picture that the index is in a tight squeeze between 1041 and 1061. This is a 60-min chart

Notice the mid channel line. It's been holding the price

for the day,volume was above average, and breadth was negative



McClellan Oscillator does not look very hot. Summation Index has a sell signal.We have had a MACD sell signal for a few days. The sole up day these past few days was on pathetic volume. So, bulls need to do something very soon. Even if my current preferred count is correct, I have no desire to establish any new positions on the index at this time. I may trade small but nothing big for now.

Nas100 has been recording dojis. Today's was on higher that average volume.

The daily picture masks the extremely volatile intraday action

Not a very pleasant day for those who tried to time it, especially the shorters who walked into another daily squeeze bonanza

I happily was involved in the precious metal area, and major indexes were just a side show for me.

On days like today, it may not be a bad idea to step back and have a look at the bigger frames of action

Nas 100 is holding firm. There are areas to improve on the daily chart and it is up to the blls to do it or leave it.

Here, as well, bulls need to do some work to improve the daily picture.

Resistance is at 1061. Support is at 1041.

Short term trend is up ( a move below 1045 may change that). Mid -term trend is up. Long term trend is down.

Have a Nice Day!