Posted on September 22nd, 2008 at 1:33 PM
How do you provide a framework for market thoughts? I do it with GETM and some good level work. Watching the markets today they surely were trying to hold together but in the end failed. Where did they fail? Right at a very important weekly level I have for the S&P 500 indes ($SPX). In the attached chart I have some Gann work that is providing my excellent levels to work with. This week the level on the downside was 1220. Once that was cracked the selloff accelerated. I know that this market does not have a prayer of any sustanained rally this week if it cannot reclaim and stay above this level. That gives me a framework of "Bearish below 1220" and "neutral to Bullish above 1220". Now I have a lens to look at the market and my expectations for how it should move based on where it is. This level is dynamic and will shift with each new week/bar. It will eventually transition to the downward angle I have on the chart as well.
