Lowest Reasonable Target For SPY Pull-back

[shortie]

Assuming one day we do get a noticeable pull-back in this crazy market, how low could it reasonably go?

I drew some lines that may be targets, please vote or suggest your own target.

Proposed Targets:
117 - area of consolidation in March
115 - Jan Top
112 - March Gap
109 - Feb Bounce
104 - Feb Low

 

[shortie]

.

 

[S2007S]

112

 

[orange_trad]

lowest reasonable target for SPY pull-back: 130

 

[shortie]

Quote from orange_trad:

lowest reasonable target for SPY pull-back: 130

i feel stupid talking about downside targets when the biggest close-to-close drop we had in the last month was ~0.7%. without bad news this market may keep going up forever. of course even bad news are good news somehow.

look at Poland: the president and a bunch of senators are dead and PLND (Poland ETF) is up 3 days in a row! this is an irrational market at its finest.

 

[indahook]

Couple stdevs below the 50 day would shake out some liquidity for the long only funds, run the vix good and setup for the next leg on a healthier move.

When is the question though...no clue.

"it is a bull market, you know"

 

[shortie]

my working hypothesis is that we will have a swift correction as in Jan. Notice that Nov-Jan advance left two gaps (in Nov and Dec). despite the huge (~13%) and lengthy run-up (2.5 months), those gaps filled very quickly once the decent started (3 days for the first one ~4% drop and 8 days for the second one ~7.5%).

if you look at GAP 3 from March, accidentally we are also about 7.5% away from it (similar to Nov Gap 1). I am projecting that it will take ~8 days to fill it once the drop starts.

this rally is more overbought than the previous one (>16% in 2.2 months), so it is more likely to fill the gap.

 

[noddyboy]

Quote from shortie:

my working hypothesis is that we will have a swift correction as in Jan. Notice that Nov-Jan advance left two gaps (in Nov and Dec). despite the huge (~13%) and lengthy run-up (2.5 months), those gaps filled very quickly once the decent started (3 days for the first one ~4% drop and 8 days for the second one ~7.5%).

if you look at GAP 3 from March, accidentally we are also about 7.5% away from it (similar to Nov Gap 1). I am projecting that it will take ~8 days to fill it once the drop starts.

this rally is more overbought than the previous one (>16% in 2.2 months), so it is more likely to fill the gap.

what is the best way for me to trade your view - at some point I might reverse longs.

 

[shortie]

should have added another option: no pullback of >0.5% for months to come

 

[shortie]

SPY is dropping like a rock: -0.01% already! still 4.5 hrs to trade today