market correcting for many reasons.
drop me an email if you want to talk about that.
with spx at 1150
3-0 buy
1-0 buy weekly
9-2 sell monthly
the longer term is intact but spx has fallen below the 50ma and that is troubling.
how much lower?
from last march's 666.79 to this year's high of 1219.80
the 76.4% fibo is 1089.29
that is another 5.2% from here
the next support is 61.8% or 1008.55, at -12.3% from today
once 61.8% is broken, we start a new cycle.
Questions:
ReplyDeleteWhy is the SPX index used and not other indexes?
What makes it significant index?
What do these numbers mean:
3-0 buy
1-0 buy weekly
9-2 sell monthly
“The longer term is intact but spx has fallen below the 50ma and that is troubling.” What do you mean?
Is the “61.89%” a percent of the maximum SPX?
How is this number arrived at? What is its significance?
Hi Anna
ReplyDelete1. the spx index is used by institutional investors more widely than the dow jones industrial average. the spx index includes 500 of the largest publicly traded companies in the US and has a market cap of $10.59 trillion as of friday may 7, 2010
this compares with the $13.49 trillion market cap for the entire US stock market.
for comparison, the dow jones industrial has a market cap of $3.44 trillion for its 30 stocks.
2. 3-0 buy is a daily count to a buy signal for the security or index discussed. similarly, 1-0 buy weekly is a buy signal over a weekly time frame. counts are based on the studies by tom demark. he was the system model builder for fame investors george soros and tudor jones. many institutional traders still use demark's way of counting for buy and sell signals.
i will be posting another detailed charts with these counts in various time frames for the spx index.
(if you search within this blog, i have posted several discussions about these counts)
3. once a security or index trades below its 50 days moving average, investors view that the trend is weak and some sell the item in question because of this fact. a buy decision if the item is above the 50 ma
4. 61.89% is one of many important fibonacci trading ratios out there. this too i will discuss in future blogs.
paul