TRADITION PAYS 11/19/12

BOT TRADING SYSTEM

THE Monday before Thanksgiving has a track record that favors the bull.  Today did not disappoint.  After an early short  the market flash a long at the SB.  The alert was issued, day done, so to speak.

alert: longs 68.75 and shorts 66.25 for PA BO opportunity.

The long buyers were likely to get +10-12, which in this case took us to the BO-10 area.  Sideways action and a new HL buy for the next BO move for the bulls.  The final exit was the PM high.

THE WORKING CHART

a 50CB at B2 was the next controlling point from the AM long.  At the 50CB, I like to watch for a test of the horizontal ( a FBO tends to continue the prior trend, resist, where a BO tends to be a great reversal) and watch the 45 degree (bull or bear).  Today, PA followed that 45TL until we had a PA correction to the .382 from the high.  Same point for the new buy signal that gave the new push to to BO 15 and the bulls exit.

WEEKLY LOOK

At the lower channel TL, hit the daily 50CB target around 1340 and seeing a buy signal, similar to the HL buy that continued the bull bias.  Time to celebrate!  But...

My gut feeling is that we will see a new low test before the actual bull rebound.  Friday and Monday were aided by temporary news.  Let congress and the President stall on the "cliff" and we push down again as new fears of a recession appear.  This fear is needed.  A substantial bull (or a bottom different view) is developed when there is wide spread fear.  By the time the general population catches on, the pros are well entrenched  at better prices.

ANOTHER LOOK

THIS view, we see the buy again at the bear channel low and a BO to run to test a key resistance level.  This is likely to push back into the channel and deplete the "news" buyers and allow the pros a better entry point.  A double low shake out, doom and gloom, makes for an interesting point to build the next bull leg,