On January 17th 2008, we took out the 3/14/07 and 8/16/07 Lows in one swift down move. Up until that time we could have been making a simple ABC flat with a potential bullish triple bottom, but eversince we took out this Trapdoor to Hell, the Bears have the upper hand.
There are some danger signs to watch closely:
1. We BACK-KISSED the Major Trapdoor to Hell Resistance at 1360-80 SPX right at the OPEN Friday 1/25/08 @ 1368 SPX and reversed -40 SPs into the close.
2. Eversince the 12/26/07 HIGH, There has been some extreme negative Time translation: 16 of the last 22 Trading days were serious decline days, much more than the consecutive rally days, which lasted only for 1- 1 1/2 trading days.
3. The strong downtrend is still very much intact , the danger has Not passed yet. Notice the 3 Red Down Trendlines in the chart (Click to enlarge) showing the angle of descent becoming steeper and steeper.
4. Although Cycles suggests we could still be in a brief rally phase into Feb 08, the overall trend remains Down into April 08.
We have yet to see CLEAR signs of reversals to the Upside. It is best to wait on these reversal signals first:
1. We need to see more than 1-2 Rally days.
2. Breaking above the severe downtrendlines with increased volume.
3. Breaking above the Major Trapdoor to Hell, which remains Key resistance.
The next hourly CIT arrives firstname.lastname@example.org pm, it should be interesting.
Good Luck and trade Safely.