Here's the 4-Point I was discussing in Jim's Thoughts, with my key set. The key set line was the main factor for me. On the S&P cash it hit the line and 'tested' it three times pretty much dead on. No matter how you label this ABCD, it was an ABCD to me at a key line, with 'context'.





Now we sit at a key line, with TICK hitting an extreme, 1-min volume short-term climactic, and so on. It would be something to see if they can't bounce this up here. What a play so far, though, eh?!

Also, as a curiosity, the 1.618 hits near that lower //, just about at Laundry's low move for this leg. Very interesting.


Chart created on QCharts, courtesy eSignal.

Watch that 710-713 area like a hawk, if they flush it right down to there. Two key set lines there, the lower //'s, from that big 4-Point CP, and some other things, including a major upsloping warning line. There is also a really cool, but unusual, natural set upper // there. Lots of Fibs fit in, too. Could be interesting, if we see it. Nice place for a big bounce, and then down to the bigger areas shown in the commentary. But, one step at a time.

ES right at the area Jim mentioned.

Notice how it just didn't show anything there, broke a bit below, and has been chopping around below, like a 'test' from below, as everyone says it's bounce time now. If it did run from here, I'd still be looking at this as the area, but a roll from here would be a successful test of the area from below, and they might get their panic. Point is, the area did act like a magnet and give the intraday bias all the way down, and now we see what they intend to do higher-timeframe-wise.

This just has that panic coming swoooosh feel to it...

stick a fork in it...now I heard the saying on TV that nobody knows where the bottom will be....
and think about the Bonds bubble that's in the making...swell times indeed..

You notice how they come in right when it looks like it is going to panic? So far, I've never seen this fail once.

Although a monster short-covering rally could explode at any time on some inane news item (like the treasury secretary, or Bail 'em out Benny, shooting off the mouth tomorrow when they make their appearences), this thing is sooooo poised for a big drop to that area I showed in the last commentary, in one shot. Imagine a 500-1,000 point swoooosh tomorrow, and we are there. INDU trading in the 5's. That would be something. Let's just say I think, for me, the risk holding some puts (initial signals were at that big 4-Point CP, with the second signal coming off that setup at 779.50) beyond this point is well within my management plan, in case they do dump it. And if it explodes, some is given back on some with that approach. That's the way it goes. No way I can tell for sure what will happen, it's all a probability game. Weigh the odds, make the decisions. That's it.

Just a close up look of today's action.
Failure of that bullish three drives pattern was defining moment thus far imo, but they are hanging tough.

Beat that line until it beats you I guess

A close on the low, and GOOG takes 'em down aftermarket. Those puts just keep looking better and better. I really expected a big bounce any minute, but the flush it out with no bounce just keeps looking more and more likely. We'll see.

I agree, T, with pretty much everything you've said. I commented a little in my weekend commentary on the unlikelihood this is a 'bull market', given all the things it is doing that have never been seen at the start of a bull market before. The intermarket dynamics are indeed pointing to the possibility of something big happening soon.

I also agree 100% with the potential doomsday scenario. There was a time when I thought all that stuff was 'crackpot' nonsense. Then I started to think maybe some of it might be true. Now I tend to think I just see no way that we won't crash back into the stone age. I try and try, but I just can't see how it can be avoided. I even think it may be engineered, not simply something that happened because of greed gone wild. I never, ever believed I would ever think something like that, but I also never thought I would ever see even 10% of what I have seen so far. Sure doesn't make me happy or hopeful for all of our futures, as you say, as 'citizens of mankind' :-(

Great market concepts, T.