We are going to do the last two trading days in one post. Unfortunately I am limited by my computer skills so please bear with me because for the first day, 4/8, we will not look at a daily chart until later. Please look at the 5 min chart of 4/7 and 4/8. Notice the small range 1.4 points. I cannot get into my java aplet to make notations, so we will use use time and price.
Wo open with a gap higher and rapidly move higher on good volume. At 82.60 there is a buying climax and then the market is supported around 81.54. Demand is coming in! This is a change from 4/7. The demand that comes in is not rapidly exhausted and the rally is able to move through the top of the trading range to 82.94 . Demand now evaporates and the break at 2:oo has impressive volume. Perhaps supply is now entering? Supply fails to come in meaningfully and the market is supported at a slightly higher low 81.60. The ensuing rally is sharp and without substantial volume, the market makes up the previous hour and 15 minute drop in 45 minutes, showing more strength than weakness. To sum up the supply and demand are about equal in a narrow range. There is more demand than the previous day and if anything the demand is a bit stronger as it is able to move the market more quickly and it is able to break the upper edge of the trading range. Supply and demand being evenly matched in a narrow range, I believe could be called a hinge. Who will blink first?
Please turn your attention to the hourly ending on 4/8. Notice how tight and overlapping the ranges are on the decline since the high at 84.61. The market could not even decline 50% back to its low of 77.96 again bullish. Finally the inability to develop downside momentum after the potential upthrust to 84.61 is again bullish. Supply or selling pressure has no dominance on this chart. Buying took a breather and no supply has been sufficient to break the market.
Turning to the 5 min 1x3 of the spx we can see the nice overlapping orderly decline described above. In addition we can see that in wyckoff terms on the 7th and 8th we built cause with all the ups and downs. Specifically across the 817 line there is a count of 12 which we multiply by 3x1 to give an estimate of 36 points. Adding that to 815 or 817 gives a target of 851 to 853, a new high.
