Monday, October 3, 2011

Looking for a holiday rally to start soon

It's getting very negative out there. Some very smart traders(Tom Demarks, Doug Kass, etc) are looking for a big rally to start this month around the 1076 level on the S&P. As you can see on the chart, 1075 is the October monthly S1 pivot and a double bottom test of the August lows. If we close below 1075 then look for 1028-1038 for next support. I do agree that the 1075 level does look like a strong support zone. My plan is to be a buyer there with a 5 point stop loss. Until then short the rallies up to 1160.
UPDATE: 10-4-11: we hit 1075 today......1173 (50 sma) is next resistance. we could rally going into 1st qtr of 2012. BUY THE DIPS!* As long as the S&P stays above 1075.