Market Start of 2011: To Correct OR Not To Correct?

Discussion in 'Trading' started by shortie, Jan 23, 2011.

SPY Correction: How Deep?

  1. Won't meaningfully correct for several Months

    2 vote(s)
    33.3%
  2. 126 - End of 2010

    3 vote(s)
    50.0%
  3. 124 - Mid December Congestion

    0 vote(s)
    0.0%
  4. 122 - November High

    0 vote(s)
    0.0%
  5. 120 - Early December Gap (Won't Fill)

    1 vote(s)
    16.7%
  6. 118 - Early December Gap (Will Fill)

    0 vote(s)
    0.0%
  7. 117 - November Low (Double Bottom)

    0 vote(s)
    0.0%
  8. 114 - September Congestion

    0 vote(s)
    0.0%
  9. 112 - August High

    0 vote(s)
    0.0%
  10. 108 - Several Unfilled Gaps (~May-Sep Average Price)

    0 vote(s)
    0.0%
  11. 103 - August Low

    0 vote(s)
    0.0%
  12. <103

    0 vote(s)
    0.0%
  1. According to this chart SPY has 14 unfilled gap since Aug 2010. The chart is too big to post here (you will need to scroll down if you open the link).
    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2393449&cmd=show[s139567847]&disp=O

    i am wondering how many of those gaps will fill if we do see a bit of dumping soon.

    i put some levels that appear to be significant to my naked eye in the poll. if you guys have an opinion which of these levels (or other) have major significance feel free to mention in the thread.
     
  2. SPY Friday Close: 128.23, recent High 129.64
    [​IMG]
     
  3. Locutus

    Locutus

    You know "gap filling" is mostly superstition right?

    Anyway, I think we'll see a massive correction but potentially from a higher level and in february.

    I watch European markets mostly and the weaker brothers there have been absolutely unwilling to back down. I was watching the previous week on wednesday and thursday intensively, and it was obvious there was absolutely no willingness on the CAC40 and Eurostoxx 50 to go down with very intensive buying taking place.

    The DAX is doing worse, but it has had a very good run and a correction from these levels would not violate an uptrend. ESTX50 and CAC40 are not even above their April highs yet. ESTX50 closed well above tuesday's highs also on friday. They are only a few % away from them.

    Anyway, I'm expecting they are driven to test their April highs and confirm they will be in a trading range for the foreseeable future (will then also retest May bottoms most likely) if there is a correction. I would watch these indices closely, because if they go through their April highs and do not retest the bottoms during a correction in the next month or so that would be a very good sign for the uptrend on the rest.
     
  4. are you saying the likelihood that the price travels through a gap is the same as the likelihood of it traveling through any non-gap interval?
     
  5. More accurately, any non-gap interval of similar distance.
     
  6. Bumping this up now that we are about to finally have a red day

    SPY 128
     
  7. looking at the gaps in the above study: most of them are small but one around 118-119 sticks out:
    125.75 - 126.15 0.32%
    124.6 - 124.87 0.22%
    120.38 - 120.5 0.10%
    117.87 - 119.56 1.43%
    116.12 - 116.26 0.12%
    113.15 - 114.07 0.81%
    111.91 - 112.59 0.61%
    110.31 - 110.8 0.44%

    is the size of the gap matter as far as the likelihood of being filled?
     
  8. i have tried to find some downside targets mentioned in recent internet articles. i can't seem to find many downside predictions but i did not look very hard.

    Short-term downside targets mentioned several times: 1270, 1260, 1250
    Somebody mentioned 1170-1200 as a possibility
    Marc Faber said -20%, which is ~1030 (not sure what time horizon he had in mind)