Crossing the Gulf

What correction? So far, those who promoted the idea of a “V” shaped bottom have been proven correct. We shot back up through the 200 day moving average just as quickly as we crashed down through it last week. We now find ourselves “in the pocket” so to speak, the term I’ve taken to using for the area between the 125 day and 200 day moving averages. The market has tended to spend as little time as possible in this range (June-July 2012 period the most recent notable exception). Not surprisingly, then, we have moved higher with aplomb, building on the near term trend originating from last Wednesday, and crossed the gulf very quickly.

Five minute chart of the S&P, showing budding trend taking shape.

Five minute chart of the S&P, showing budding trend taking shape.

We’re now within a hair’s breadth of the 125 day, coming in at 1946, which may present the S&P with a good place to take a break after such a sharp snap back from the lows. For the Bulls, its will be yet another test of the strength of the bounce. For the Bears, it represents the last best hope for a stall out and retest of last weeks lows.

Daily chart of the S&P 500

Daily chart of the S&P 500

Price behavior around the 1946-1950 level will give us clues as to how to position for the rest of the week. At this point, if you’re short, take a break above this level as a signal to cover, with an eye towards a retest of the 200 day if we fail and move lower from there. If you’re long, take note of any weakness over the next few days, and be ready to take profits if we fail at this critical level. I personally favor the long side, and if we move decisively above 1950, ┬áthe odds are good that we retest the September highs.

-Will Mogey (Twitter: @wtmogey, StockTwits: @wtmogey)

2 thoughts on “Crossing the Gulf

  1. seo

    Hello Web Admin, I noticed that your On-Page SEO is is missing a few factors, for one you do not use all three H tags in your post, also I notice that you are not using bold or italics properly in your SEO optimization. On-Page SEO means more now than ever since the new Google update: Panda. No longer are backlinks and simply pinging or sending out a RSS feed the key to getting Google PageRank or Alexa Rankings, You now NEED On-Page SEO. So what is good On-Page SEO?First your keyword must appear in the title.Then it must appear in the URL.You have to optimize your keyword and make sure that it has a nice keyword density of 3-5% in your article with relevant LSI (Latent Semantic Indexing). Then you should spread all H1,H2,H3 tags in your article.Your Keyword should appear in your first paragraph and in the last sentence of the page. You should have relevant usage of Bold and italics of your keyword.There should be one internal link to a page on your blog and you should have one image with an alt tag that has your keyword….wait there’s even more Now what if i told you there was a simple WordPress plugin that does all the On-Page SEO, and automatically for you? That’s right AUTOMATICALLY, just watch this 4minute video for more information at. Seo Plugin

    Reply
  2. Cathrine

    You need targeted visitors for your Crossing the Gulf – Vorsus Capital website so why not try some for free? There is a VERY POWERFUL and POPULAR company out there who now lets you try their website traffic service for 7 days free of charge. I am so glad they opened their traffic system back up to the public! Sign up before it is too late: http://hud.sn/5

    Reply

Leave a Reply

Your email address will not be published. Required fields are marked *