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Keene Little : 12/31/2007 12:31:26 AM

When looking for potential turns in the market we often look at price levels. But time is also an important consideration. Back at the end of October I had suggested we could be at an important turn in the market based on equal time sequences that had been playing out since the October 2002 low (as well as hitting a price projection at 2211 and where price would hit the top of its parallel up-channel). This was the NDX chart I had shown at that time: Link and this is the updated chart: Link

There were major turns in the market happening after equal time spans and gave us a time window (week of Oct 28th) to look for the next turn. Now looking at SPX's daily chart since the July high we can see a similar time sequence between important highs and lows: Link

The next turn window according to the time sequences on SPX is Jan 10th (+/- a day). The interesting thing here is that if it's to be a turn window then whichever direction the market is heading into that date could see a reversal (and that's what I've shown for the bullish and bearish scenarios (along with price projections for each move).

Keene Little : 12/30/2007 10:23:53 PM

Monday's pivot tables: Link and Link

I thought we'd see more of a rally on Friday but it didn't happen. But the chart of the COMP still gives me the impression that we should get at least another leg up to match the one from Friday's low. That would not be much but two equal legs up would be at 2686 which would also be a 38% retracement of the decline from Wednesday. If it can chop its way higher, the 50% and 62% retracements are at 2695 and 2702. I'll be looking for a continuation lower so I'll be looking for a short play to set up. Link

Assuming we get the bounce and another leg down then it will be time to see what kind of bounce develops after that so as to determine whether a new rally will start or we'll likely get a continuation of the decline.

There are several EW possibilities on the DOW and SPX so the direction of the COMP could provide more clues than I'm getting from the other markets. But for now, as confusing as it looks, I'll be watching to see which scenario starts to look like the more plausible one on SPX: Link

OI Technical Staff : 12/30/2007 9:59:59 PM

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