28 Sept 2012

So far so good... We Ended the Month on a Bearish note for the indexes.  The write-up I had lastnight could still be in play for the DOW.

The Monthly that closed is important as all except for the Precious Metals have made reversal candles.  Everything from banking index, Currencies, to international indexes have put in reversal candles (bearish).

Anyone looking at the Canadian dollar should look for some downside pressure in the next few week to months...

Other Possible Count

This was the other pattern I was working on yesterday, but I had to confirm that we could count this as a new trend down, which was confirmed to be an option in EW terms. So I am showing it today.

This screen grab was done yesterday after the close so it wont show this mornings move.

UPDATE

All the write up didnt pan out as markets head lower and has eliminated a 5 wave move up. Stoch. 60min SPX crosses down and is about to print in 4 min. This has to reverse for the bulls to make any significant move up. Otherwise its down down down...

TRACING IT FORWARD..

Ok so I have been trying to figure out these patterns along with the indicator that has been developing along with it.

So I have a theory of whats to come, so lets see how accurate we can get with our analysis.

What do we know?
We know that the patterns down from the Sept 14 high looks corrective as EWrs dictate and as we can see there are an abundant of 3 wave patterns.  Therefore, we can say that "IF" this is corrective then the way to label this are indicated on the chart below..

So now whats next?..
Looking at our Stoch. momentum, the 5min chart of the SPX is the one that has bottomed with divergence to price.  So my Theory is that this would push the 15min stoch. up and allows the 60min to complete its overbought move.  Therefore pushing down prices again to make 3 waves for a 2nd wave of 5th wave.  This would end the day negative and end the week negative and most importantly end the month with a reversal bar.

Forward looking these patterns would be ideal for what we are looking for to allow us to finish the month with bearishness and allow the next month to move higher and turn down confirming the bearish trend down.

On a daily and monthly basis this is what we would look for to form out...

Monthly chart below:

To close this post out, if this Theory doesnt pan out then at least we can say we can refine our analysis some more and give us practice as to how we can better forecast future price and patterns.

BEWARE THE VIX

Beware the Vix.  Which predicted the Sept 14 top in the market.  Our daily stoch. is on an uptrend yet the 60min has already hit the oversold condition.  This is a good example of what a reset looks like and once the VIX 60min turns up, the most likely case would be for the Daily stoch. to push and continue higher.  Which means bad for the market.

27 Sept 2012

SPX rally, but open for a bit more upside with stoch. at overbought.  This should hopefully pull back tomorrow by end of day and give the bears the reversal candle on the monthly that they have been waiting for for a long time.  Like always, we must let our indicator tell us what is happening and never get ahead of it.

Thursday Scenario

So what we are looking for is for the 60min to tell us where we are in terms of a continued push down for the daily.  Right now our daily is in a "Bearish Position".

1st option - We definitely need to see a lower low tomorrow to finish of what could be a wave C of 4th wave.  Then up 5 waves to new highs to complete the 5th wave of this final leg. By this happening we would expect the Stoch. in the 60min to move up to the overbought level.  To confirm the 5th wave we would need to see the daily stoch. at a divergence with daily prices.

2nd option - We definitely need to see a lower low tomorrow to finish of what could be a 3rd wave of wave 1.  Then a 3 wave move up or a sideways move to finish off a 4th wave of wave 1 then down again with a 5 wave pattern maybe around the 1412 or 1402 range on the SPX.  This will give us wave 1 because we would then find the Daily stoch. at or near the oversold level and the 60min stoch. hovering around the oversold range aswell.

Option 1 = green arrow up to new highs.
Option 2 = Magenta arrow down to new lows.

Key will be what the 60min action does for the Daily charts and its indicators.

26 Sept 2012

Further decline with SPX becoming bearish on the daily trend.  The rally that we were looking for did not pan out today so maybe tomorrow.  A 3 wave pattern would definitely indicate a bearish move to more downside pressure.  Although we have not had a rally in the indexes we did have it in the precious metals. 

Seems again that the Precious metals have been doing the predictions by again being ahead of the game.

SPX:

Daily -Bearish Sept 26 - Last Bullish Sept 6 - Last Bearish Aug 31 - Last Bullish July 26 - Last Bearish July 23 - Last Bullish July 13 - Last Bearish July 10 - Last Bullish June 27 - Neutral June 26 - Last Bearish* 25 June - Last Bullish 12 June - Last Bearish 11 June - Last Bullish June 8 - Last Bearish May 4 - Last Bullish Apr 25 - Last Bearish Apr 4

Weekly - Bullish July 27 - Last Bearish July 6 - Last Bullish June 29 - Last Bearish May 11 - Last Bullish Nov 2011

DOW:
Daily - Bullish Sept 6 - Last Bearish Aug 23 - Last Bullish July 26 - Last Bearish July 23 - Last Bullish July 13 - Last Bearish July 10 - Last Bullish June 26 - Last Bearish 25 June - Last Bullish 12 June - Last Bearish 11 June - Last Bullish June 8 - Last Bearish May 4 - Last Bullish Apr 25
Weekly - Bullish July 27 - Last Bearish July 6 - Last Bullish June 29 - Last Bearish May 9 (not yet printed) - Last Bullish Nov 2011

SILVER:
Daily - Bullish July 25 - Last Bearish July 23 - Last Bullish July 17 - Last Bearish June 19 - Last Bullish June 1 - Last Bearish Apr 13 (Entered oversold Apr 24) - last Bullish Apr 12
Weekly - Bullish Aug 24 - Last Bearish Apr 4 (printed Apr 5) - Last Bullish Mar 30 - Last Bearish (Mar 21 2012 Printed Mar 23) Last Bullish (Mar 19) - last bearish (Mar 14 2012) - Last Bullish Jan 27 2012

GOLD:
Daily - Bullish July 25 - Last Bearish July 23 - Last Bullish July 16 - Last Bearish July 6 - Last Bullish June 29 - Last Bearish June 21 - Last Bullish June 1- Last Bearish May 3 2012 - Last Bullish Apr 26 - Last Bearish Apr 16 - Last Bullish Apr 10
Weekly - Bullish Aug 10 - Last Bearish Mar 13 2012

Warning!!!

I am writing today to give a warning of whats to come in the next few days to weeks to months in the stock market.

There is an overwhelming sign that the market has topped for the time being and Im putting it mildly.  Why you ask? and havent you made these predictions in the past? Whats so different now?

Today is September 25th 2012 10:22pm, and I have been reviewing the charts today and mainly the stoch. as I usually do everyday.  Many EW'rs have this trend down as corrective and it looks corrective even I had that same thought.  One thing that did come out at me was the higher time frames namely the Weekly, Monthly.  The set up for this is so great that even if the market moved up tomorrow as Im predicting we might not see a higher high and it would be more of a risk to hold on to the long positions.  Many are as we speak, holding onto their long positions thinking this is a correction.

Let me explain.  The price on a monthly chart on the general indexes has hit the upper BB, and if we are in our current position now, we would be looking at a reversal candle for that monthly bar that will print by the end of this fridays market (EOM).  Not only that,  the stoch. has already turned down which is much more bearish if one was to look at the weekly.  So the only thing that will negate all this would be for new highs this week and for the daily to turn up tomorrow. My guess is it will due to the 60min at oversold levels and the daily in neutral.  What does this say?  The analysis calls for a "watchout" moment when the point of 60min stoch hits the overbought and daily stays negative.

The MACD has also turned down on the Daily charts of the SPX. As we know its not easy task to turn MACDs around on a dime and it will take time like a long bus.

As you all know each time frame will move accordingly, and if the monthly has finally turned it can move for months.  Therefore it is not something I would want to stand infront of.  The financials were weak, and GE one of my bellweather is also week on all time-frames.  The SPX ratio indicators are also weak.

This would be the time to stand back and get the gun powder ready if not have some position in to make a bit of money if it does move quickly.  I still would not put all of it in until I am dead sure that my 60min is working in the dailys favour. GLTA

25 Sept 2012

Looks like our 2nd option yesterday panned out and we have seen lower low.  We will see how fast or impulsive the move is to the upside as most of the indicators are oversold.  Expect markets to move up tomorrow.

24 Sept 2012

Still looking for higher prices to come.  So far we have gone sideways for 7 days. Daily SPX has a stoch. that has come out of its overbought condition, but the 60min chart has stoch. pointing upwards a clue to the continued downward push would be if 60min stoch. crosses back down.  On a 5min scale the count would be a 1-2 1-2 of 3rd wave of 5th for the bullish case, and another alternative would be for this move to continue downwards for a C of C wave of 4.  If your confused dont worry so am I.  Always the case when your trying to count on a micro level.

21 Sept 2012

The Bullish count that was talked about yesterday was the one that came through and have moved up substantially before we made a correction.  There is a greater chance now that we go higher by monday as we see a reset or bottoming of the 15 and 5 min charts in the SPX.  This should keep the 60min Stoch. at overbought levels or near it, and maybe we get that divergence to finally end this top.  As far as our daily count is concerned, we can definitely make a divergence to put that cherry on top.

The weekly charts for the market index has kept bullish and overbought.  A turn down next week would be ideal because we are in a good "set-up" situation.

So for the week coming up, lets look for higher prices and for divergences to occur and a possible cross down of the weekly Stoch. indicator if not out of the overbought zone at least a trend downwards.

20 Sept 2012

There is an issue with the movement this past week and although we have been looking for a higher move upwards for a 5th wave up.  The momentum doesnt seem to suggest that, therefore I would propose a scenario where we have topped and we are in a start of a move down.  Tomorrows action will tell if we move impulsively down for a wave 3 of 3 or if we are still on a wave C of C for 4th wave action.

Lets look at these options:

This first option shows a wave structure of a 1-2 1-2 count with a 3rd of 3 down. This will depend on how impulsive the move tomorrow is if its to the downside.

15min chart of why this could be a possibility of moving to the downside.  As you can see we are at overbought situation while the stoch. in the chart above is around the midpoint of the graph.

Option 2:
Would see us in a process that is still trying to complete.  This would make an ABC with C being a zigzag.

Option 3:
BULLISH count.  This would imply that we are moving up in the morning open then down for a corrective 2nd wave of 5th wave up.

19 Sept 2012

A flat day today.  There is no clear answer as to where this is going so best to just stay out for a few.

18 Sept 2012

We should soon see an upward move from the Indexes.  Although our daily has turned down our 60min indicator has hit oversold levels and it can only push up the daily charts once it turns up out of OB range. 1450 would be the support for SPX.

To put this rally into context, I looked at the Russell Finacial Weekly Charts which I watch constantly but you can use the SPX aswell for an example. The Slow Stoch. crossed up indicating a trend change on June 4th, and recently we have come to another cross.  This time to the downside. What is important here is not the turn but what happened to the prior trend.  The trend that started June 4th Lasted 3.5 months.  That is a long time of waiting if your a Bear.  This time the Bulls might be calling foul if the trend last quite a while but since we are still in a weekly overbought range we cannot rule out a turn up in a few weeks.  This will be evident in the daily chart when it bottoms and where the weekly Stoch. sits by then.

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