| We are out of office today, but wanted to put this brief update for those watching the S&P-- Shown below is the S&P 2 Minute chart through 10AM Friday. Note the steeply decelerating downtrend
line. In my view, if the S&P can move back above this trendline later on today, which would equate to a move approximately back above 1330, the market will have concluded its panic low and should start a rally back toward 1400. On the next page, I show at the top, my Super Hourly RSI, which is an extreme OB/OS Indicator. Over the last two hours, it actually dipped below its lower oversold line. Going back over the last few years, shown in follow on charts, that has been rare to hit the lower line, even in panic declines seen in 2006 and 2007. We are now, where we were when the first Sub Prime low was
seen in mid-Feb 2007. Other then that, it has been years since 2001, and 2002 that we have seen these kinds of oversold values. Today (above) The August 2007 Panic decline. Daily DJIA OB-OS Oscillator at ?180 yesterday, probably near ?210 today, most of the time, you get a healthy bounce off of these
readings, even in a Bear Market. Watch 1330 closely, if the S&P can climb back above that level, a rally will probably take hold. Frank |
