MW's Blog : SPY boundaries - Avoiding the risk of a volatile market

The 700 range: I suspect that the DOW fluctuates between 9,300 and 10,000 points. A Breach of the support or resistance line would be considered as an indicator of the next trend relatively to the volume of breach.
If the DOW breaches the 9,300 points with high volume of trading then the support line becomes a resistance line and we will witness a drop in the DOW to the next levels down to 8,500 where it is supposed to show a stronger support than 9,300.
If the DOW crosses the 10,000 points with high volume of trading then the resistance line becomes a support line and we will witness a ramp in the DOW to the next level up to 10,500 where it is supposed to show a stronger resistance than 10,000.
As for the SPY it's worth watching it around 107.54 the next resistance line. Hopefully it crosses it with a volume higher than 540 millions. If it does then we are absolutely going to see a new ramp up to 111.26 where it becomes to strong resistance and even stronger at 112.94. As for the downside if it starts to drop then it can easily drop below the 100 down to 91. In all cases we have to wait to see what happens after the 107.54 zone.
My strategy consists of staying out of the market for the time being and stay alert for the SPY at 107.54 I will start holding positions once SPY crosses the 107.54 with a high volume greater than 540 millions.