SPDR S&P 500 (SPY)

[2bit-nothing]

Hi You,

"Well, there is another longer term pattern that is playing out, and that would be a 20 year "M-A" pattern with SPX. Double top 1999 and 2007. We are now making the top of the "A", and the drop takes us to new lows... likely all the way back to 1990 levels. let's see which one plays out..."

Cannot visualise your other pattern without a chart, so I cannot comment on it.

"What will negate your interpretation of the market as you see it now? What level needs to be taken out? And are you not taking into account the broadening megaphone pattern on the various indicies? "

There are many indicators that involve statistical analyses of price and A/D issues. They are all moving constantly and it is not one level or price that determines change of trend. Chart pattern is just a snap shot of the market at certain point for the convenience of some traders. You have to know the statistical success rates of the different patterns. All patterns will fail at some point and their significance are different at different stages of the market.

"Vix weekly is at long term support and it looks like we are going to make a double top "M" pattern. It needs to first break out of it's falling wedge pattern. Not too mention the incredible positive div. on that same time frame with the stochastics getting a bullish touch last week. Maybe get the cross over next week..."

Not sure I understand this. If it is at long term support, how can it be an M top? You would expect a W? Especially when you are talking about a bullish falling wedge? Mind you, you could loose a lot of money trading on divergence, if you do not have a better tool, don't trade on divergence.

Further, VIX only accounts for a portion of the price movement, not all of it. It is like taking election poll, the real outcome could be very different.

2bit