SPX, 60 Minute View

By: Gary Tanashian | Wed, Apr 22, 2009
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April 21, 2009

Snippet from NFTRH29: As you know, NFTRH has recoiled into a cautious stance as this week I sold the last of what was considered positively correlated (to the economy and markets) stuff. This is due to the bullish state of the Gold-Silver Ratio (shown later in the report) as well as some commodities, notably copper, having reached the targets laid out in NFTRH dating back to January http://biiwii.blogspot.com/2009/04/copper-hits-target.html. This does not however, mean Hope '09 will not proceed higher. In fact, it is likely we are nearing the end of 'A' in an ABC upward correction. With the power of the historic decline into March, and with world leaders busily conspiring in attempts to construct a story that calms the angry masses (basically the story goes 'we are going to do whatever is necessary to provide confidence and get [insert country here] back to work again' but is in actuality 'don't ask me, we're just rolling out the global fire hoses and spraying freshly 'printed' money around until the pain stops') it will not be surprising to see this be a drawn out affair to the upside.

Well, 'A' wasted no time in announcing its completion, as the market did end last week right at resistance that was noted on a daily chart in NFTRH29. With the terrible fundamentals becoming all the more terrible via the policy of administering more of the poison that killed us, I do not confidently declare this merely an 'A' leg into a 'B' decline before new highs. But the A-B-C is on the table and bears who are looking to get back in business might want to take note. This scenario has implications with gold and commodities as well as it appears markets are moving in concert, which is a far cry from the all out panic of October-November 2008.

NFTRH29 showed the daily chart of SPX to plot out a potential upside target along with a big picture monthly to support the case that there may be higher to go after shaking the momo players and 'sellers' remorse' capitulators.

Here is a 60 minute chart showing yesterday's breakdown with some downside targets. At this point I am not sure whether I will plan to buy anything positively correlated to hope for a would-be 'C' leg into summer. I prefer to just let things unfold and see if we are correct on the A-B-C correction first.



Gary Tanashian

Author: Gary Tanashian

Gary Tanashian

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