Negative Ghost Rider...

posted Oct 10, 2014, 9:22 AM by Katie Shook
That pattern is full?  More like pattern is messy.  (Forgive the Top Gun reference.  It’s dated, I know.  But c’mon, it was a great movie).  We've seen some huge moves this week – with matching volume on the downside to go with the corrections.  The only solace I take right now is that futures seemed to bounce back from around the 1915 level overnight — which would be about 1920 or so for the actual SPX right now.  Does that mean anything?  The hope would be the market sniffing out a bottom to this pattern.  More realistically, we've got additional downside volatility to deal with.  My most SWAG probability figure is about a 25% shot that the market has found a bottom already;  the 50-dma of 1972 looks like resistance with 1887 being support.  That’s another… 3 or 4% downside?  And it would still be less than an 8% pull-back overall. 

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