Market Analysis for Nov 8th, 2004

Well, all of the action off of Friday's post-election, and post- Employment high at 1171.75 has "morphed" into the a triangular shaped pattern. Based on the coordinates of the pattern, after another couple of hours or so of coiling into the apex, the E-SPZ should break out-- but in which direction? My work is telling me two things: 1) that because my micro and near term work remains overbought, and in need of additional rest, that the breakout will be to the downside, which initiates bout of weakness into the 1158-1156 micro support area. HOWEVER, and more importantly 2), because my intermediate term work is VERY constructive, it may OVERWHELM the micro and near term corrective scenario after merely a sideways (very shallow) rest-corrective period, which then sends the index charging to the upside. What to do? Well, the bottom line for me is that we definitely dont want to be short, BUT we will use any weakness to establish new long positions. Stay tuned- the day is young yet.

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