31 Dec 2014 - Last Post of The Year

What would the year be if I didn't post an end to the year.  Wishing everyone an amazing year next year and a very profitable one at that.  The year has given us the ups and downs we typically expect from the markets, but it pretty much ended the year with many surprises and much more higher highs.  I do fear however that the end is near for easy money... and that all the bulls must get adjusted and used to trading a downward bias.  Many who have been around a long time say that the difficulty in all of the years they have been trading is to turn the switch the other way.

I think the best time is when we get those warning signs even as markets push higher.  The market today did accelerate downward and have confirmed our PA sentiment from last night.  But I did not expect this much of a move lower with low volume to end the year.  But maybe the manipulators are working overtime this end of year...

"RIGGED"

MT: UP
ST: UP
PA: DOWN

30 Dec 2014

Still no significant direction on the market..  But indicators do suggest an acceleration down for an intra-day level.  Overall though it's a stay the course kind of day.

There is something to note for those who are still sitting in front of their computer trying to figure out their strategy or finances for 2015.  The daily MACD is giving us a clue and its a very important one that I have seen over and over and over again.  It is the fact that this indicator is sitting near the zero line.  So what is this zero line all about?  Well its basically another way of showing us a bullish or bearish trend (but a lagging one).  You are probably asking "Why then is this a clue if its a lagging indicator".  Sometimes, the way it is setup can be a foretelling advantage.. 

In this case for our current MACD, it is occurring in almost all markets.  It is also diverging from the price highs.  When a price moves in a impulsive manners indicators tend to get left behind (this is how divergence is formed negative / positive).  A cross of the MACD down or up shows a "possible" change in trend, but a cross below or above the zero line shows a much more bearish or bullish trend.  If the price is over extended and the indicator seems to slow or even halt it is a sign that momentum is not following, therefore the MACD being close to the zero line is actually a distressing sign.  The deeper a signal is or the higher the signal is the bigger chance of that trend lasting longer and higher chance of lagging.

So watch if prices move down if this MACD crosses below the zero line.  A few examples for you if you are not convinced or are confused.

MT: UP
ST: UP
PA: DOWN

Note:  Indicators will lag, but it is not a cause of concern if we know how to use it.  So when a signal is closer to a line that dictates a bullish or bearish trend one must be aware of it because any change in trend will give us the opportunity to get into or out of a position without lag or without high risk of missing out or getting out.

GOOGL

NFLX

 WTIC - OIL

Ron Paul On The Real Meaning Of The 1914 Christmas Truce

By: Ron Paul | Sun, Dec 28, 2014

Via: Safehaven.com 

One hundred years ago last week, on Christmas Eve, 1914, German and British soldiers emerged from the horrors of World War One trench warfare to greet each other, exchange food and gifts, and to wish each other a Merry Christmas. What we remember now as the "Christmas Truce" began with soldiers singing Christmas carols together from in the trenches. Eventually the two sides climbed out of the trenches and met in person. In the course of this two day truce, which lasted until December 26, 1914, the two sides also exchanged prisoners, buried their dead, and even played soccer with each other.
How amazing to think that the celebration of the birth of the Prince of Peace could bring a brief pause in one of the most destructive wars in history. How sad that it was not to last.
The Christmas Truce showed that given the choice, people do not want to be out fighting and killing each other. It is incredibly damaging to most participants in war to face the task of killing their fellow man. That is one reason we see today an epidemic of PTSD and suicides among US soldiers sent overseas on multiple deployments.
The Christmas Truce in 1914 was joyous for the soldiers, but it was dangerous for the political leadership on both sides. Such fraternization with the "enemy" could not be tolerated by the war-makers. Never again was the Christmas Truce repeated on such a scale, as the governments of both sides explicitly prohibited any repeat of such a meeting. Those who had been greeting each other had to go back to killing each other on orders from those well out of harm's way.
As much as governments would like to stamp out such humanization of the "enemy," it is still the case today that soldiers on the ground will meet and share thoughts with those they are meant to be killing. Earlier this month, soldiers from opposing sides of the Ukraine civil war met in eastern Ukraine to facilitate the transfer of supplies and the rotation of troops. They shook hands and wished that the war would be over. One army battalion commander was quoted as saying at the meeting, "I think it's a war between brothers that nobody wants. The top brass should sort things out. And us? We are soldiers, we do what we're told."
I am sure these same sentiments exist in many of the ongoing conflicts that are pushed by the governments involved -- and in many cases by third party governments seeking to benefit from the conflict.
The encouraging message we should take from the Christmas Truce of 100 years ago is that given the opportunity, most humans do not wish to kill each other. As Nazi leader Hermann Goring said during the Nuremberg war crimes trials, "naturally, the common people don't want war; neither in Russia nor in England nor in America, nor for that matter in Germany." But, as he added, "the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same way in any country."
This is where our efforts must be focused. To oppose all war propaganda perpetrated by governments against the will of the people.

29 Dec 2014 - Holiday Boredom

With the New Year just around the corner, I would be safe to assume that most if not all are still in the holiday mode.  So a sideways grind might not be out of the ordinary.  With all indicators still pointing up, I am inclined to say that the new high or higher highs I am expecting is still valid.  Perhaps when everyone returns to the market for the new year will they see the gift they have been given and cash in.  Probably not before prices makes a higher high..

The divergence I have been monitoring have faded with prices staying sideways which has relieved most of the pressure for a correction, as evidence seen in todays pre market action where a draw down occurred and then a rise into trading hours.

MT: UP
ST: UP
PA: NA

2015 BULL / BEAR CHARTS

NOTE:  These analysis can change due to market or individual conditions.  It is used to tell us whether the particular index or equity has entered a bull or bear phase.  As you can see below,  It is not the "TOP" or "BOTTOM" but it is close to it.  This allows us to be in the same trend of any gaps that could be devastating to those who have invested heavily.  The more volatile it is the closer these changing signals are.  We want to catch the "LONG TRENDING" price moves that occur at least once or twice a year.

These charts are of the daily time-frame, and although some trends have lasted a year or so, most common trends based on these time lines will last days to weeks.  So I have made the indicator to look at the longer term which you can see last for a few months...

Hopefully this will make it easier for some to understand how I view my indicators and what I consider important (Not a top or bottom but getting the right trend).

Enjoy!!!

24 Dec 2014 - Merry Christmas Bonus

As a Bonus for Christmas, I will be posting some charts of individual equities that many could be trading as well as some index.. Hopefully we can see where the state of the markets is at.

The SPX made a lackluster correction today and couldn't even get out of the OB range.  I guess this is not a surprise as volume probably wasn't there. On an intra-day level the non-concern of the markets for a correction causes indicators to reset as prices stay relatively sideways.  What this means is that chances are a continuation to higher highs will happen when the indicators bottom out.

MT: UP
ST: UP
PA: NA

MERRY CHRISTMAS!!! and I will be back with some charts..

23 Dec 2014 - Still Looking For A Correction..

The 60min chart is showing negative divergence but there are no indications that our ST is turning over.  Therefore, any move lower would be considered a correction until an ST is established to change any trend.

With the new high we made today, the weekly chart is not in negative divergence as well.  A reversal of the markets would raise the potential that an ST CIT is not only at hand, but that the longer term CIT could last weeks to a month or so.

MT:UP
ST: UP
PA: NA

22 Dec 2014 - Market Pause?

Since this is a Holiday week, I would gather that markets will be sideways for most part and lack in significant volume.  Unless we get a Christmas present from either the Grinch or Santa.  At the moment the pattern suggest a impulsive move tomorrow then eventually rise to new highs.

I mentioned previously that each day we move higher that the abc/de counts becomes less likely.  I an impulsive move down for this scenario to still be kept alive.  Are we in a 4th wave subdividing structure?  That's a good question..

MT: UP
ST: UP
PA: UP

19 Dec 2014 - Whos Buyin' This Crap?

Before I go on with the analysis, I thought I would share some article from Zero Hedge that I found interesting and for some of you who haven't read it, here are links.

http://www.zerohedge.com/news/2014-12-19/just-one-question-about-yesterdays-last-minute-berserk-etf-freak-out

http://www.zerohedge.com/news/2014-12-18/how-fed-masterfully-punkd-algos-stock-buying-frenzy

http://www.zerohedge.com/news/2014-12-18/fed-grandest-con-job-history-world

http://directedge.com/Alerts.aspx

Now back to the market.  Although the SPX and the ES did not make a new all time high, it is at the doorstep again.  Like an annoying salesman coming back over and over again.  When will it go away?  Well, the answer to that would be when the FED wants to.  The high volatility is or was expected and it makes our indicators lag due to price movement in a very short time period.  Indicators are not volatile and move with time and set parameters.  Price on the other hand is a different story as seen from the last 3 trading days where we went from OS to OB. 

Due to the volatile nature of the indexes, it is better to play the individual equity, where the indicators are a bit more reliable during this time. 

A new high next week followed with a lower push would cause the Weekly charts to negatively diverge.  If this triggers the market to sell, then expect a few weeks to a month of selling.

The move today does not alter any wave count structure yet, but its becoming less likely by the day...

For now though, the bulls are in charge of the game or the FED for that matter.

MT: UP
ST: UP
PA: UP

18 Dec 2014 - So What Gives?

I have to admit that my gut says one thing and the indicator says another.  But I am an advocate of following the indicator as your main trend indicator. Therefore my gut feeling has to be put aside, and if it is right then the indicators will SYNC with my personal sentiment. 

The reason why I am conflicted with the ST being UP today is that the low made two days ago was made of 3 waves.  Yes I know, I said EW cannot be used as the main analysis.  I am not concerned by the wave count itself, but what the structure means.  This would mean that the low made was a corrective pattern, and based on that analysis the patterned formed from Red B to Red C would be overlapping corrective counts.  This is the only explanation of why we made a corrective pattern low.  Another option would be that the correction is not over and that we could make another low with a C wave move lower (see Blue count wave-C).  The 3rd option would be that we are in a triangular forming pattern (see Pink counts CDE).  This last count could throw a fork into our indicator as volatility plays its ugly head.  When volatility hits, indicators lag due to the price moving fast in either direction in a very short amount of time.

Either way, these 3 options we have gives us an analysis that we would see new highs sooner than later.  So long players should set up for a long play..

MT: DOWN
ST: UP
PA: UP

17 Dec 2014 - Bears A Fighting...

There is still life in the Bears.  The overlapping in the recent days suggest we are still in a corrective phase.  Todays move does look impulsive with the SPX moving up 40 + pts.  Regardless of the EW counts, indicators are still bearish, but if we are curious as to the label of the pattern, then you can find the scenarios below.  Remember that these counts are possibilities not definitive. 

An acceleration up / down would be the clue as to the general direction of the trend. Whether we are still in a down-trend or a CIT.  Targets of 1950 would get us to a 5th wave scenario, whereas a 1919 target would give us a Wave C scenario. 

The FED hasn't done much in terms of giving the market that needed boost to push markets higher, but maybe it just needs time to sink in. Perhaps tomorrow we will know what everyone else is thinking or feeling.

MT: DOWN
ST: DOWN
PA: DOWN

16 Dec 2014 - 5 Waves Will Be Bearish..

Price action on the SPX suggest it is possible for a 5 wave pattern to form within the next day.  Todays late day drop has produced a 3 wave to new lows, so we should expect an expanded or a triangular pattern to form for a 4th wave.  A continued decline tomorrow with a minute 5-wave decline would mean that we have our v-wave complete and a rally would occur.  Maybe this is a good example of where many will think the FED is behind the cause of the rally but in reality it was going to happen no matter what..

In any case, my indicators are bearish and down-trending at the moment.  I do see divergences so I need to be aware of the possibility of a rally coming.  If one is not comfortable holding their short but unsure how low we could go, I would suggest taking some off the table.  If a triangle forms for tomorrows session I could put a short position on short-term with a target of 1950 where the 50% and the 200 Day MA sits.  This in my view is a strong support..

MT: DOWN
ST: DOWN
PA: DOWN

 

Previous Posted Chart:



If a 5 wave structure occurs then we could be looking at patterns in this form... (Remember it's just a what if Forecast).

15 Dec 2014 - Santa Rally Got Tired?

It's too early to call a victory for the bears as the overall markets are bullish (See right hand side Market Sentiment).  It is hard though to look at our indicator below with a straight face and say this is still bullish.  The indicators especially the ST is the bread and butter, and at the moment its still in a down-trend.  Indicators are in SYNC and oversold which makes it even more dangerous.  Prices today closed below the 50 and the 75 day MA, this is also bearish.  Last time this happened?  The Oct. plunge.

If the top has been made, an EW count in Blue would be the best case scenario that would give us a 5 wave decline before a 2nd chance rally.  We can confirm this once we reach this with the indicators if we reach this point.

I failed to point out that todays low is also the 38.2% retracement if we are to assume that the top made early Dec. is "THE" top.  This would also push the 50% level near the 1950 level which has the 200 Day MA approaching.  Time allows all of these to converge and sometimes we should be aware of these things to give us the advantage.

MT: DOWN
ST: DOWN
PA: DOWN

12 Dec 2014 - Target Range Hit, Now What?

For a while there I didn't think prices was going to make it to the 2009 SPX level before the end of the day, but the last 15min proved to be crazy.  Not only did we hit our 2009 target, but it also came close to our 2000 - 1999 level as well.  All within a 15min period.  By the end of the day the SPX has lost 33 pts.  This is what you call acceleration at its best.

So now what?  Well so far the EW count we have labelled yesterday is still in play.  A 161.8% retracement to 1980 still exist based on the first chart shown yesterday (but without the 161.8%).  We would need to see if Mondays price action keeps us in a move lower or a start of a rally.  We could possibly still test the 2000-1999 level.  The MT has changed as well so we need to be mindful of this even if its a lagging indicator.

The 2 levels I will be watching for on the next down leg is the 1980 and 1970. (2nd Chart).

MT: DOWN
ST: DOWN
PA: DOWN

11 Dec 2014 - Similar Patterns?

Are we forming the same type of pattern with the one made in late Sept. down to Mid Oct.? (Blue Circles).  Again the 75ma has become a resistance, but this time its in the 60min chart.  An A=C wave of this move would target a minimum of 2009 SPX pts.  Which is also the tops made during Sept.  Our MT signal is not indicating a turn for a move down.  Therefore I am inclined to call this move so far as corrective.  Price can stretch down to 2000 which is not too far fetched since it within the distance.  This is also the 75 Day MA as well.

MT: UP
ST: DOWN
PA: DOWN

 

I have added another alternative EW count that I had missed prior...



10 Dec 2014 - Patience Was The Key

It pays to be patient, and the bears got rewarded today for staying with what the indicator said.  We are still currently bearish, and have broken past yesterdays low which is another bearish signal.  A rebound or a CIT could occur but we would need the ST to tell us that and prices now have a chance to test the 1999-2000 level in the SPX.  This is where the 75 Day MA is sitting and to me it is a very important line that no one really talks about.  There are a lot of stocks out right now with bearish indications, and this is a possibility that the bearish or down trend is not over.

MT: UP
ST: DOWN
PA: DOWN

9 Dec 2014 - Another Fake Out?

Are the Bears getting the shaft again?  There a few things to consider, and that's todays price action.  After pushing lower significantly markets have rebounded hard.  Although markets closed negative, the picture has been painted bullish.  For some price action dictates trend.  So to sum it up lets list the bullish and bearish points.

Bullish:
Reversal Candle - UP
Main Trend - UP
Price Closed Above 20 Day MA
Price bounced off Lower BB (Mentioned in yesterdays post).

Bearish:
ST Still Down
60min Chart Bearish
15min Chart Bearish (Both of which should stay bearish to keep things going the Bears way)
Price stopped below 60min 75MA
Individual stocks still sporting bearishness on a lower time frame.

For now, even if things look bleak for the bears, I urge you to follow the indicators.  Yes, it does lag when volatility comes into play, but it can also be said the same for bullish trades.  Who will come out the winner?  Only the indicators can tell.  For now, the bears are still winning the argument despite the convincing rally the market had today.

MT: UP
ST: DOWN
PA: NA

8 Dec 2014 - Another Turn South

So will this turn last longer than the last one at the beginning of December? From my intra-day charts it's looking like it..  The next price target to focus on at the moment is the 2040 level where the 60min 200ma sits.  After that, it will be the 2030 where our Dotted green line resides and also the Daily chart Lower BB line.  Our lower indicators are still on a down-trend so this might have some legs.  Current daily charts are in OS territory, therefore the chances of an acceleration are high and the risk of it is to the downside.

MT: UP
ST: DOWN
PA: DOWN

5 Dec 2014 - Market On A Sleeping Pill...

We might be making higher highs as expected but there is no drama or excitement to it.  So will we get caught off guard when the market turns?  Lets examine todays move..  Like yesterday but in reverse, the market rallied and tried to get back to breakeven then gets pushed higher just enough to stay positive for the day.  You wouldn't think that any significance or news came out yesterday or today based on these patterns.  Is this the calm before the storm?

The 5min chart again shows a 5-wave down but most importantly an impulsive move lower.  But I have been wrong with my counts before.  A C-wave move lower from 12pm today could explain the move if we make higher highs next coming Monday.

The daily chart though has formed a reversal candle with a continued divergence.  This would be significant if our intra-day charts confirms its current downtrend, and push both timeframes lower regardless of what the count is.  If it does push lower, I would then like to see the ST turn over as well, and hopefully last longer than 1 day this time.  Remember, we should be reactive and not jump the gun on what we think the market might do.

The possible target at this point in time would be the 50% retracement but can't rule out the possibility that prices could stop at the 38.2% as well.  It is wise to make an analysis of what lies around those levels.  The more support, moving average, or resistance line that lies behind these Fib. retracement the higher chance of prices settling down on either options.

MT: UP
ST: UP
PA: NA