Danger, Will Robinson!

UPDATE 2:17pm EST: IF we hold the 832 level on the SPX, which is 61.8% fib line I drew yesterday, then I have reason to believe that we might rally up to 920 next week.

Perhaps what Eric is seeing in his XLF analysis is an early warning sign. Again, the close is almost two hours away and if we drop from here we might continue our trajectory downward. But I wanted to give you guys an early warning to at least hedge yourself for the weekend. Maybe sell some puts against the ones you’re holding – or take profits.

UPDATE 3:30pm EST: Looks like CatBird got his wish and the market dropped – good for you mate. The Yen is still wrestling with the R1 pivot – it seems that’s the Berlin wall for now – watch towers, moat, and crocodiles included.

We are closer now to the 78.6% mark – still a possibility we rally from here, but the pattern is weakening a bit now. Just FYI – I think being hedged over the weekend is not the worst idea still.

UPDATE Closing Bell: Well, that was an interesting and productive week – only regret I have is not being able to trade most of yesterday. I’ll be posting my forecast on Sunday afternoon – in the meantime take a look this Karl Denninger post – great analysis as usual.

Favorite quote: “Charlie Gasparino was trotted out by CNBC to claim that some sort of deal was imminent”. LMAO 🙂

UPDATE 7:02pm EST: Okay, since everyone here seems to confuse Karl’s analysis as mine – NOT SO! People – I was not suggesting to take Karl’s SPX targets at bare value – just wanted you to read his analysis of the Fed’s meddling. In my mind he’s more of an economist than a trader. Obviously I continue to follow the scenarios I outlined for what – 2 months now?