4/19 weekly analysis

The major market indices have all reached the next level of potential resistance since the start March +20% rally.

I entered several short positions hoping for a pull back and a gap full on the RUT.

RUTWeekly Pivots for week ending 17-Apr-2009 (Source:mypivots.com)
	Classic	Woodie	Camarilla	DeMark
R4	570.8	557.7	495.2
R3	536.7	523.6	485.8
R2	502.6	502.6	482.7
R1	489.5	489.5	479.5	496.1
PP	468.5	468.5	468.5	471.8
S1	455.4	455.4	473.3	462.0
S2	434.4	434.4	470.1
S3	400.3	421.3	467.0
S4	366.2	387.2	457.6

Here is the chart:



I'm expected a pull back to fill the gap up on 4/9, which should first bring the RUT back to the 455 level and if that levels fails, the RUT should fill the gap at the 440 level. Looking at the pivot levels the 455 high is very likely given that this is the S1 level. The 440 level looks to have a lower probability. S2 is 434. The S2 level is possible. I've been reading many of the blog analysis of how much we will pull back on the next leg down. One camp says we will come down to low 400s and the second camp think that we will have a minor pullback then another leg up more.

I'm going to keep an eye on the RUT this week and make sure that it does not close above the 480 level. On Friday it was close. The RUT closed @ 479, just slightly below 480. I need to be more disciplined about getting out of trades that have gone against me.

Overall, the markets are expected to pullback some this week. The pathetic volume in the major indices, along with the major players (GS, INTC, C, JPM, GOOG) all have reported earnings. They all rallied up to their earnings release and have pulled back since. I don't believe that this market can go higher without some major good news and the good news seem to have come and gone.