This is a purely technical guesstimate for how the market will advance given the pschological, sentiment, monetary, economic environment as I analyze it. The waves are just guesses based on market reactions to visible support and resistance
levels. I "saved" this yesterday with the DIA
at 128 and now with the market back up to 129.70, it appears that the support level
down at 124-120 appears solid and it shouldn't be tested for at least another 10 weeks.
The important element of this chart is the amount of time that has been spent prior to the breakout rally. The more time and accumulation, the bigger and longer lasting the rally. All the while, even though VIX
has been low indicating complacency, equity mutual fund outflows have been strong which continues to show fear. Now that we are one day into earnings
reporting season and the trend is positive.
Cheers. Technical Tim April
12, 2012 3:59PM EST