TGI Friday

A key target for bulls yesterday was to break up from the falling megaphone on NDX, and they did that. As long as NDX can hold above broken megaphone resistance that is a bullish break with a target back at the 3717.36 high. If NDX breaks back below broken megaphone support then that would raise a possibility that this break may be a bearish overthrow with an ultimate target in the 3000-3100 area, so I'll be watching that trendline carefully. NDX 60min chart:

Dow is now very close to testing the all time high made in April, and we may see that today. That would not of course negate the overall beautiful topping setup here, which will remain in play up to the 17130 area. Dow 60min:

Short term uptrend support on SPX is the 50 hour MA, now at 1875. If that is broken with any confidence today then that would throw this current uptrend into serious doubt, so I wouldn't be blindly buying any dips under that. SPX 60min chart:

It is the end of the week today, and if we see another bullish day then the weekly upper bollinger band, currently at 1896, should close no higher than 1900 which should also cap any move up today. SPX weekly chart:

I've been considering the setup on GLD, and while I'm still leaning long there is definitely a bear scenario in play as well here. On the bear side is the descending triangle from the current rally high, which is a pattern that breaks down 64% of the time, and could trigger a move to new low if GLD breaks below it. On the bull side there are now two very nicely nested double-bottoms in play here that would target a test of the current rally high. Whatever happens GLD seems likely to break in one direction or the other very soon. GLD 60min chart:

TLT is still making progress towards falling megaphone resistance on the projection below that I first posted in January. If the end of QE3 is going to trigger a big rally on bonds, as it did at the ends of QE1 and QE2, then it's worth noting that on a break up from this (70% bullish) falling megaphone, the target would be 125.43, to wipe out all the losses on bonds during the first year of QE3. Watch this space. TLT daily chart:

The stats are bullish again today, and I can currently see no good technical reason to expect a significant retracement, so I'm leaning bullish unless demonstrated otherwise. The 50 hour MA at 1875 should be good support on SPX and if we can see a decent AM low followed by a strong push up, then a retest of the 1897 high on SPX is in possible range today. I would mention that the historical stats for the first three days of next week are bearish.