2015 Ends In The Guillotine

The only one that survived 2015 was Tech.  The SPX and DOW has ended its 3 years of positive closes.  Although there is no rule that says the following bar should be bearish, it does not lend itself to anything good when you couple this with weakness in all aspects of the world economy...

SEN: Bearish
ST: DOWN (To close the year..)
PA: DOWN

The fact that both ST and PA are in SYNC is not a good sign to start the year and with a bearish sentiment, one could only imagine, but enough gloom.. HAPPY NEW YEAR... Bears..

30 Dec 2015 - Yearly Bar Tracking

So far of the major markets, the only yearly bar at a positive going into year end is the SPX, DAX, CAC, NASDAQ.  While these 4 are positive, 2 (DAX, CAC) are sporting a reversal yearly candle. The SPX is at the dividing line between being bullish and bearish and should be interesting by closing tomorrow.  This leaves only the NASDAQ that is positive, which does not say much when you couple these with Indexes that are already in the red, ie. FTSE, DOW, NYSE, RUT, WLSH, and TSX.

Now add the international index, and you pretty much see either a red or a reversal yearly candle while positive.  Therefore, 2016 is looking pretty gloomy indeed.  however we still have tomorrow so who knows right?  If I have time this weekend I will compile the yearly charts for the above markets for your viewing pleasure.

SEN: Bearish (Up-trending)
ST: UP
PA: NA

29 Dec 2015 - They Must Have Been Reading My Blog

So yesterday I said "unless there is a miracle of sorts and price rockets up out of nowhere. " ,
and what do you know, not only is there no significant news but also on light volume.  Well, technically we still have 1.5 days left of trading and anything can happen I suppose.

The SPX and the NASDAQ are the only one currently in positive territory for the year, with the RUT, NYSE, WLSH, and DJI in the red.  On a yearly basis, prices have now closed above the yearly Upper BB line.  I think a break of this should signal the start of the move lower for bears.  On a side note, the Market Sentiment is in a Bearish but up-trending mode right now.  So, it's probably better off to let the rest of the trading week play out and then assess the situation then.

SEN: Bearish (Up-Trending)
ST: UP
PA: UP

28 Dec 2015 - Closing Out The Year

Can the SPX close below the 200 day MA for the year?  Technically, with everyone still in holiday mode, it can go both ways.  Light volume can be manipulated to move one way, and I for one would not put it past MM's if they decide to close out the year on a somewhat positive not even if that is just a few pts. above the 2015 open.

With the ST being on the Up-trend, we should still look along that direction.  But do note that the chart below not only shows the highlighted 200 day MA (Red), it is also Highlighting previous supports which is now a resistance to our price.  Indeed we are looking for a yearly doji by the close of this week, unless there is a miracle of sorts and price rockets up out of nowhere.

SEN: Bearish
ST: UP
PA: NA

24 Dec 2015 - Christmas Re-Eve-Iw

Nothing much to talk about the past few days other than the ST has shifted to an UP position yesterday.  I was a bit busy, so I was not able to post yesterday.  Today, there isn't really much to report either on the market as it is still in an upward trend with an intra-day that is OB.  Neither one of the past 3 swing moves have provided any clue as to the possible pattern forming as all 3 swings have been impulsive in nature.

The weekly chart is sporting a positive bar that contradicts last weeks bearish candle bar, but this time frame is still in a bearish course.  The weekly support if we fall back below 2040 is near the 1900 level.

EW patterns available here are;

Wave i-ii (From Sept Bottom)

Wave C (Still Forming with a possible LL target below Aug. lows with an extended price target of 1800)

Wave - c (Of a sideways Triangle forming an a-b-c-d-e to complete a 4th wave) This option could form for a few weeks or months before any breakout occurs.

A wave iii down is not out of the question since our sentiments are still bearish and patterns could allow for such a count, but with the ST staying in an upward direction, this count will have to wait a bit longer to confirm.  This pattern though should be taken seriously due to its accelerative tendencies.

SEN: Bearish
ST: UP (Dec 23rd)
PA:  UP (Dec 23rd)

SENTIMENT UPDATE:

22 Dec 2015 - Santa Is Trying

We are facing a rally into Christmas, but for market to even call it a success we would need to surpass the ATH made a few months back.  With the high probability that each day closer to Christmas we will be seeing lower vol. and this would make it difficult for price to perform a bullish miracle.

Current price is between the 200 and 75 day MA, but is hitting the 60 minute charts 75 moving avg.  We could still an extend rally tomorrow since we are still in OB in the intra-day.  Bulls need to watch the exit of this OB range to exit their longs.

SEN: Bearish
ST: DOWN
PA: NA

21 Dec 2015 - No Interest Day?

Seems like no one is interested in the markets, but prices seem to be setting up a corrective pattern here.  If I am correct, then we should see more downside coming.  Of course this is just pattern recognition.  But this analysis is also in sync with our ST signal which is much more reliable when both or more indicators are in agreement.  Intra-day is also still in bearish territory.

SEN: Bearish
ST: DOWN
PA: NA

18 Dec 2015 - Candle or Dynamite..

I don't really know where to start since this move the past few days is just too damn UGLY.  Not your normal kind of push down.  No... this one had a few implications, so lets just list it in point form.

- 5 waves down from FED high.
- Below 200 day MA
- OS in intra-day closing meaning a possible acceleration risk to downside by Sunday futures or Monday open.
- Weekly closing candle bar look like the picture above, with price under 75 and 20 week MA.
- ST turned down

Aside from being technically bearish, investors do not look too confident about the rate hike.  I can guess with financial institutions quick in raising interest rates themselves as well, that things will just get worse unless someone intervenes or provides better options.

My Bearish Sentiment Indicator will definitely have pushed further away from crossing over to bullish.  This keeps us gloomy for the longer time frame.  So I will not waste your time with reading and just show you ugly pictures.

SEN: Bearish
ST: DOWN
PA: DOWN

It's not to say we could not rally or turn bullish, and I think next week should see some pressure alleviated and should rally.  But in all honesty, it's not looking good.

This last chart has not updated its weekly results but you should see the signal push lower and away from the 50 keeping things in bearishness.  The signal for a few weeks was very close to turning bullish as can also be seen in the price movements in the SPX.  All in all I still remain bearish.

17 Dec 2015 - Hangover

Can we say that the market had a sudden hangover from yesterdays FED celebration?  Well still too early to say since ST is still pointing UP.  However, the impulsiveness could just be causing the signal to lag.

The intra-day session is back below the 200 day MA, and this whipsaws can be expected after such an announcement.  I would be foolish to believe that this whipsaw or impulsive manner in price is over.  So lets check to see if this sudden move up the past few days is a new count upwards or just part of another count of an a-b-c up.

SEN: Bearish
ST: UP
PA: DOWN

Note: As I update this blog, the ES has pushed lower into OS territory, therefore the key here is the Monday low that needs to hold for bulls or break for bears.

16 Dec 2015 - Lit-Er-Rally

Prices are taking off as per FED.  Question now is.. Actually a few questions now is;

1. What will China and EMs do.
2. What are price rally really saying? Getting out or getting in...
3. Who will be stuck with the Trillion dollar collection bill? As per ZH.

No reversal daily candle, ST in the UP position with no negative bias.  This might take a few days to take in, but as the market is suggesting everything is rosy, and top that off with a closing above the 200 day MA.  So today, we should not fight this sentiment.

SEN: Bearish
ST: UP
PA: UP

15 Dec 2015 - FED er Rally..

No one knows what will happen tomorrow, but one thing is for sure.. Nail biter till Yellen opens her mouth.  ST turned up today, so it suggest a up market, yet we are still in a bearish range so we should be flexible for tomorrows possible whipsaws.  There will be whipsaws, so for those who can't take the moves, I suggest staying on the sidelines till it settles down.

Prices for the SPX is still under the 200 day MA.  so there are negative connotations to the current ST.  All EW counts or forecasting would be foolish as raising rates and holding rates will have the same risk probability.

SEN: Bearish
ST: UP
PA: DOWN

The indicators above are not in SYNC making the analysis for tomorrow a confirmed hard tell in direction.

14 Dec 2015 - Bullish Again?

Bullish Again? It will have to depend on your time-frame to see if your trading sentiment is bullish or not.  So never follow others into thinking the same while your setup might throw a different analysis.

Last night the ES charts was indicating that prices are looking to push lower and I tweeted it out saying that the risk of a downside still exists.

This morning prices made lower lows from Friday's low.  The rest of the day pretty much went sideways and by 2:50 pm prices started to signal bullish.  The rally was impressive by days close, however the hourly charts are still bearish, with prices just touching below the Mid-Nov. lows which is also the 75 day MA.  This could be just back-testing with what looks like a 5 min. 3 wave corrective rally.  Things can change, so I will have to see if there anything significant to tweet tonight while futures chug on.

The SPX has extended its price move lower negating the a=c relation, but it might just be a throw-under.  The spike low though came as a support by the 50% retracement near 1993.40.  The 2000 level is now a psychological support.  Question now is if markets will push prices through this level and weaken markets into FED speak day.  The other support to look for if price breaks down would be at 1964.60 which is the 61.8% ret.  If you are still short and your indicators are still flashing a bearish sign then this is the level to watch.

SEN: Bearish
ST: DOWN
PA: DOWN

12 Dec 2015 - Similar Warning From August

Back in Aug. 21st, just the weekend before the Aug. 24 drop in the markets I wrote;

"Does this look like a Bullish chart?  I don't claim a crash is coming, but what I do know is we are at risk of one. or a very nasty slide. With my market sentiment in Bear Mode"

But the descent actually started 3 days before this freefall.  We are looking at similar situation now with indicators for the daily chart in OS condition with a weekly close in bearish position.  Longer-term, this bearishness should last weeks to months based on my theory.  But again as discussed yesterday, the bearishness needs to overcome the FEDs actions and stay bearish or this weekly signal will become an anomaly.

The possibility of this accelerative move coming might even surpass the lows made in August.  This is the point where I would encourage everyone who follow EW to put aside the pattern counts and read what the indicators are telling us.  Due to our bearish market sentiment along with a downward signal in our ST and PA, we can see that the risk is to the downside.  Therefore, we must plan for this event regardless if it happens or not.  So again, like the statement I made back on Aug. 21st.  "I am not claiming a crash, but there is a risk of one."

11 Dec 2015 - Time And Time Again...

Days like these should feel good for those who know what clues to look for prior to the move.  There are days where nothing shows up on the radar or is hard to find any good signs of a market direction.  Yesterday however, I mentioned that a turn is likely based on the intra-day charts bearish sentiments.  A target of 2020 - 2010 was my ideal level and today we not only closed in this range, but we also touched the lower end of that target.

Surpassing the Mid-Nov. lows will nullify the triangle count, but this does not mean that a bearish guarantee is at hand.  This could just be a C-wave correction, so we should watch what happens next week.

Apart from the above analysis though, the weekly has closed on a bearish momentum and this will now allow the markets to draw down for a few weeks or months.  Easier said than done when we come up to a FED possibility of raising rates.  Usually the weekly signals "should" indicate longer term sentiments, but in this case the signal could be false or turn up quickly.  So let us see what happens with the FED decision to raise or not raise.  I will be looking at the prior day before FED speak to see if there are any clues as to the direction regardless the outcome.

SEN: Bearish
ST: DOWN
PA: DOWN (Pls. see notes for Dec 9th of why this signal matters)

Note: Conditions are still OS so short position can be held over the weekend.

10 Dec 2015 - Itching

There are good reasons why my fingers are itching to just trade something, but this sideways market has been a true test to patience.  I believe soon enough that this market will resolve this consolidation, and it is no surprise that the proving ground here is the 200 day MA.  The negative divergence I mentioned yesterday is still in play in the intra-day charts even with the reversal at the end of the day.  Can we still test the 2020 or 2010 level?  The intra-day chart is leaning for a downside bias based on today's close so lets keep this in mind and plan for that scenario tomorrow.

SEN: Bearish
ST: DOWN
PA: DOWN

9 Dec 2015 - Broken Triangle

The near term triangle has been weakened but still remains above the mid-November lows.  Although this still looks like a triangle or wedge, the price pattern however is producing a much complex count.  Right or wrong, one thing is clear...  ST is still favouring the downside action.  With the intra-day trend being bearish with only a neg. divergence present, the case for price to break down out of the triangle is strong.  It could be that prices are targeting the 2020 - 2010 area, and this would alter the count to finish of a corrective move that started in early Nov.

SEN: Bearish
ST: DOWN
PA: DOWN

Note: The PA is flashing a downside risk for acceleration and if this holds true tomorrow, it would most likely negate the negative divergence present or active in the 60 min. chart.  So be aware of this in case it unfolds.

8 Dec 2015 - Corrective Patterns Abound

The price move today fits with our ii-wave count or a continuing pattern that would finish a d-wave.  Perhaps these indecisive formations is a prelude to a bullish rate hike sentiment.  At least this is what it's looking out to be.  But we should also be reminded that an E-wave could end this rally without making an new all time high.  This would make it a very bearish setup and outcome.  Of course this is still a ways away and it's pointless to think too far.

The price closed below the 200 day MA today even with the rally we had from today's low.  The ST is suggesting that trend is still down.  If this is true then the 3 wave formation we are seeing is not really a 3 wave formation and that more extensions should be added tomorrow.  So far though, the triangle theory is holding up against our ST.

SEN: Bearish
ST: DOWN
PA: NA

7 Dec 2015 - Triangle-ish...

Although the pattern is not complete, we can look to the possibility of a triangulated pattern that would label the count a 4th or B wave.  A 4th wave scenario will have prices eventually breaking the early Nov. highs and increases the chance of another ATH.

Currently the ST is pointing down.  The signal has not changed from the impulsive move up last Friday due to the reversal today, but if prices in the intra-day stays positive tomorrow, chances are high that the ST will turn UP as well, while a negative daily outcome leaves the ST in bearish mode.

SEN: Bearish
ST: DOWN
PA: NA

Note: The distance of price from the the highs on the NYA, or RUT are disconcerting.  A failure to make an ATH in the main index is possible or with an ATH in place a divergence could be the signal to trigger a CIT.

4 Dec 2015 - Reversal Of Fortune

Markets rally, but are the jobs numbers believable? Today's move shows exactly what you believe to be true does not reflect the sentiments of the market.  You are a grain of sand in a sandbox, and the collective needs to be in sync with your views for your trades to work.  This is why I prefer to just follow the indicator to show me where the major sentiments are.  Following the herd is not a negative, just don't follow them off the cliff or to the slaughter house.

The triangle pattern I drew last night still looks good, but the impulsive move today will give us some doubt due to the fact that triangular patterns are usually a sideways affair.  A possible 4th wave low could already be in, but we also have numerous options that could still play out that puts price lower.

We can see a bullish view on a weekly basis supported by the 75 weekly MA (2040).  This level needs to break and prices need to stay below this for a longer term bearish look.  I will look again to our market sentiment this weekend to see if we are possibly crossing into a bullish market or just retesting that bullish range.

SEN: Bearish (Risk of turning bullish)
ST: DOWN (Impulsive move today will cause ST signal to lag.)
PA: UP ( From Down 2 days ago to Up just today alone, volatility does not disappoint).

3 Dec 2015 - Never AssUme

Back in Sept. we saw exactly what we are seeing now.  Although we cannot rule out a higher high, we cannot assume that we will make one either.  The best way is to follow your indicator.

The SPX is making a case for more movement lower as of today.  Things can change from day to day so you need to be always on your toes for when that shift happens.  Stick to as little indicator you should use and to one time-frame as to not get confused.  I always think of it as cutting wood.  There are many ways to do it, and they can be fast or slow.  It's all on your preference.  But the main point of this example though, is that you cannot use both at the same time unless you are aware or conditioned to do it accurately and precisely.

The intra-day chart is now showing that prices have broken the wedge support as well as the 200 day MA.  This was the situation we were waiting for to happen, and clearly it broke to the downside.  The negative divergence on the 60 min. was successful in alerting us to a possible downturn.  However, the divergence on the daily chart has not materialized and might not materialize as seen below on the daily chart.

SEN: Bearish
ST: DOWN
PA: DOWN

Note: For those still looking for a higher high in the SPX or market, the triangle option below that is newly drawn could potentially happen but we would need the signals to confirm these moves.  If we stay oversold tomorrow we could see this nullified.

2 Dec 2015 - Price Finds Support Even With Tragedy

The hourly wedge that has been forming since the flash crash is still showing as support that price is acknowledging.  As with France the day or weekend after, most traders expected a drop in the market, but the reality was far from expectations and markets rallied.  Will we see the same thing play out here tomorrow?

Perhaps...  But in the meantime the 60 min. divergence mentioned yesterday seems to have reversed price today, or we can just call it a coincidence.  There is however another possible negative divergence that we need to watch, and that is in the daily chart.  This will only become one if prices exceed the early Nov. highs while momentum stays relatively weak.  Of course this would assume price would rally in the near term.  This scenario might not happen at all and the indicators will be the only one to follow to be on the right side of the trade.

The SPX is still holding major 200 day supports as well as the pattern mentioned above.

SEN: Bearish
ST: UP
PA: DOWN

RESULT: Bullish in a bearish market...

1 Dec 2015 - Negative Divergence Active

The negative divergence is now active in the 60 min. chart due to price moving above the Nov. 20 high.  Prices is in OB territory and can have the potential to accelerate up, so those short should be aware of this signal.  My Gann angle has also been breached to the upside.  What was once a resistance should now act as support.

SEN: Bearish
ST: UP
PA: UP

30 Nov 2015 - Back To Work Monday

Hope everyone had a delish Thanks Giving in the US of A.  The daily chart starting off the week is showing weak momentum and a weak price movement.  So far no negative divergence can be seen unless prices in the SPX shoots up above the previous highs made in early Nov.

The intra-day charts is so far bearish for the hour with the ST still holding to the UP side.  Look to the intra-day charts to move back up above the mid-point to resume bullish trades, where an OS reading will signal a cover on those who are long the market.  Support and resistance still dictate the price movement sideways currently until we have a firm breakout from it.

Remember that the Market is currently up trending on a bearish market...

I was sent this by a friend and thought I would share it with you folks;
http://inflation.us/wp-content/uploads/2015/11/2016economiccrisisreport.pdf

If you are long, then you are probably one of the statistics on this report.  While the Smart Crooks have left the building with your cash.  Don't drink too much Egg Nog this holiday people...

SEN: Bearish
ST: UP
PA: NA

25 Nov 2015 - Enjoy The Turkey For Those South Of The Boarder

The market was relatively flat today, as can be expected from an eve to a holiday.  This could be setting up for a rise on Friday though.  Perhaps we will get some good Black Friday Numbers to stuff that Turkey.  2065 still remains as support with resistance at current level SPX.

SEN: Bearish
ST: UP
PA: UP

24 Nov 2015 - Back Stabbing

Russia is feeling back stabbed by Turkey today, as said by President Putin in regards to the shooting down of their bombers.  Bears seems to be in the same boat as prices quickly rallied back to green after the first few hours of the open.  "Serious or worried" about war doesn't seem to be in everyone's mind.  Prices in the SPX however is still under the Gann angle.  We need to see if this will cause the price rise to stall, but remember that there are numerous supports right underneath near 2065.  Ultimately this needs to break for a sustained move lower.  Otherwise this is "still a bull run in a bearish market".

Intra-day signal is bullish and in SYNC with the ST, but any high tomorrow in prices could cause a neg. divergence.  Again, divergences do not mean that a reversal is guaranteed, but could potentially warn of a weakening momentum until the next reset occurs.  So keep the signal in mind for tomorrows open.  Bearish if it falls below 50 and Bullish if it stays above... It's as simple as that.

Note:  I kept the option 1 (Red Dotted Line) on the chart, but prices are more likely following in the way of the 2nd (Green Dotted Line).  Any break of the blue dotted trend line will be my signal to go short.  Also in regards to 5th waves, a failure to make a new ATH in the markets is also acceptable as it is commonly seen in final push up in price.  So be nimble my friends.

SEN: Bearish
ST: UP
PA: NA

23 Nov 2015 - It Wasn't A Hard On After All

This morning, the thought of the markets being up on the merger of Pfizer and Allergan got me thinking Viagra instead of Botox.  Well I guess, there was no hard-on after all, just a slight lift is all.  I guess we need a few more shots of Botox for the indexes since we have been lingering in the red for much of the day.  The ST is still bullish and have hit that annoying Gann angle I have been showing for the past month.  Perhaps it is telling me that this line represents a significant resistance support pivot.

On an intra-day basis, the 200 and 75 moving averages is close to turning bearish which you can see below in the 60 min. chart which is also the range the 200 Day MA resides.  This will be a challenge for the bears to breakdown for sure.  If we do have the lower trendline support (Blue Dotted) for prices we should look for the signal in the 60 Min. chart to turn up before a long position can be placed.  A breakdown of that trendline could have us revisit under that as a resistance via a rally.

SEN: Bearish
ST: UP
PA: NA

20 Nov 2015 - Still 3 Wave Lookin'

The rally is still looking like a 3 wave pattern.  We should keep alive the possibility of a 5 wave move since our ST is still UP.  This weeks close suggest that we will likely break the highs made 3 weeks ago in the SPX.  With the weekly chart in OB territory it is also a possibility that we would make an ATH.  Perhaps no one wants to have a red Thanks Giving holiday.  Prices this week was just short of an engulfing candle, but remains bullish.  The line the bears need to break now will be the 75 Weekly MA at 2036.

One thing to note is that the Russell and NYSE is lagging dramatically.  This is worrying since this would indicate that the small caps are not participating and are weak while the market is only buoyed by the blue chips.  The buy backs and this weeks IPO's have been through the roof.  With these divergences, I don't see these index highs sustaining for much longer.

SEN: Bearish
ST: UP
PA: UP

19 Nov 2015 - Forming Like A 4th

The pattern today seems to be forming a 4th wave.  This however is a smaller degree 4th, but we should still see a higher move tomorrow and perhaps a 2090 target in the SPX.  What happens after that is another question. With the end of the week closing tomorrow, a bullish scenario would look most likely if prices do not at least retrace to the start of the weeks open to form a reversal candle.  The bearish scenario would also see this 3 wave rally end and can be confirmed when prices break below  2065 retracing the last smaller degree high.

Nothing has changed in terms of our general direction.  ST still remains UP...

SEN: Bearish
ST: UP
PA: UP

18 Nov 2015 - Testing Gann Again

As you can see prices for the SPX has stopped right under the Gann angle.  Now I know that this is an orthodox way of using Gann angles but if prices are respecting it then why wouldn't we use it as part of our analysis?  Since our ST has turned up from yesterday prices validated the signal by its continued move higher today.  This bullish strength in a bearish market is impressive, but we should not lose sight of the larger picture.  Any move lower should be much stronger than the strong rally we have been seeing this week. Ed Carlson's  Lindsay analysis has a probable high near the end of the month possibly right after thanks giving.  You can read it HERE..

As for our own analysis,  we are hitting a resistance that is obvious to the naked eye when looking to the left of the chart.  Prices could still push through this as our ST is on the uptrend, but if this is a corrective move a-b-c from this weeks low, then we should be looking for a 3 wave move up which we have currently.  If we get another wave higher then it is possible that we are pushing towards a diagonal ATH to perhaps finish of a 5 wave rise.  This would make a the flash crash in Aug a corrective event.

The intra-day charts has stayed in the bullish end for most of the day and in OB territory hence our 33 pt. rise.  We also have a neg. divergence that we need to be aware of so could this be the signal for a turn-a-round tomorrow?

SEN: Bearish
ST: UP
PA: UP

17 Nov 2015 - Resisting Overhead

SPX touched the 200 day MA and reversed back down today.  This is not anything surprising, but what is, is that we have an turn up on the ST.  With the intra-day being in bullish territory, we can see that the impulse that started yesterday is something to be respected.  The caution now belongs to the bears, a new uptrend might be at hand.

Some are asking why I am advising caution at every turn.  Well,  although some are in the business of absolute forecasting, I cannot at all say that I am 100 percent sure that markets are in a bear or bull market.  What I know is weighing the risk and probabilities which favour our trades.  By all means, I encourage you to do your own analysis and follow your trading rules.  I cannot say that mine is the perfect system, but I do know it is a safe one.

The overall sentiment is still bearish but this up move is counter acting the sentiment causing a imbalance.  This is not what I call a safe trade even if we have a rally like the one that happened back in late Sept - early Oct.  Yesterdays mention of a diagonal triangle can now be considered a candidate for a pattern formation.  If the intra-day continues the uptrend then we should look for more impulsive behaviour from prices.  Otherwise if we get an OS reading in the signal I would initiate my short again.

SEN: Bearish
ST: UP
PA: NA

Note: I mentioned yesterday also that we should look for a pull back pattern, and based on today's pullback, it seems that a 3 wave pattern has formed.  This is a suggestion that we err on the side of bullish move tomorrow in a bearish market.

If you do not understand my reasoning with my words,  I am merely stating that risk of acceleration or impulsive moves usually occur within its trend. Therefore even if we are bullish, we should be better off planning for a bearish trade when the signals have turned to take advantage of accelerations and impulsive formations.  Trading all ups and downs is just lunacy..  Stress is more likely the end result regardless if you make money or not.

16 Nov 2015 - Bullishly Cautious

The SPX was true to form, and the expected lower low was achieved today to the 2020 mark.  Does this suggest a continued lower projection?  This we do not know, so what we can use to analyse the short-term is to look at the intra-day behaviour which at the moment is bullish.  Since our ST is still down trending, we need to be cautious into the long trend or rally, however you look at it.  Once the SYNC is back in place can we consider a more solid case for a protracted down-trend.

We should consider though that a possible diagonal triangle is forming and that this would allow for a new ATH to be established.  Now, this is just an option I am presenting and not backed up by facts.  But if we are looking at the August lows as a corrective pattern which has us continuing an impulsive up-trend we should then consider that this move up currently is finishing off a 5th wave that should take us to new ATH or FAIL.  If the ST turns up, I would look at this option more seriously.

Price in the SPX is currently testing the 200 day MA resistance.  So another clue as well is to see if we get a pull back in 3 waves or more.  This should also help us with the steps we can look at next.

SEN: Bearish
ST: DOWN
PA: NA

Note: If the intra-day signals move back into OS territory, expect an acceleration downwards, and a new low could play out.

13 Nov 2015 - Possibly Not The Low

Upon closer inspection of the various time-frames, there is a high chance that the low is not yet in.  The major reason for this statement lies in the weekly chart where prices have closed below the 75 week MA.  This implication suggest that if the trend is true.. then we should look for a downward move for at least a week or more.  Of course this is dependent on the lower time frames and prices never ever go on a straight line.  However, since my target of 2020 has been met (off by 2 pts.).  I will consider this a short term victory.

The ST again has proven reliable, and while it can be inaccurate in times of high volatility swings, it does also do well in long runs like we had in the Oct. rally. So far it has also been good for the recent turn down.  The SPX at the moment is at risk of an acceleration down as I indicated in yesterdays (PA).  The close today has only increase the odds for more acceleration to the downside so beware of such moves.

The low today also not immediately evident was the Fib. level of 38.2% from the lows of late Sept. to the highs made early this month. Of course this on top of the support of the Daily 75 MA and Lower BB line.  Levels to watch here on out is the lower Fib. retracement levels of 50% and 61.8%..  If the intra-day signals does bounce and moves out of OS or into OB range, we should look to exit any short position.  Ultimately, it will all depend on your exit strategy which will never work if you do not follow it.

SEN: Bearish
ST: DOWN
PA: DOWN

Note:  Last week I mentioned that our Sentiment indicator was at risk of turning bullish and that we needed a big turn-a-round this week to halt it from extending into bullish territory.  This week the movement in price achieved that goal and it still remains "Bearish".   Often times when studying the behaviour of these signals, we can see also the subconscious behaviour of the markets.  How is it that the one signal that a few or no one ever follows warns us that a change of trend needs to occur before the market changes its sentiments?  This is technical analysis, and it's why I believe in it so much.  We just need to fine tune our understanding of it.

12 Nov 2015 - No Man's Land

SPX closed the day with prices in "No Man's Land"..  I would have thought the 200 day MA with the 60 min 200 MA would be strong enough support but markets dictate sentiment and they closed below these levels.  This leaves prices nowhere near any support other than the next 75 day MA and Lower BB that is converging at the 2020 level.

We did however get a positive divergence in the intra-day charts, but this should be confirmed by a rally and signals closing out of OS.

SEN: Bearish
ST: DOWN
PA: DOWN

Yesterday we also noted that prices closed below our Gann angle and high probability exists of more downside.  This is still the case today with the 200 Moving Averages being broken in the immediate time-frames.

11 Nov 2015 - After 2 Days Of Support

Price in the SPX has broken the Gann angle that I drew up on the daily chart posted on Monday.  It only took 2 days and since we broke that angle today, we should look for the next support at the 200 day MA (2063.95) followed by the 200 MA of the 60 min. at 2046.  Yesterday I said that the intra-day needed to stay bearish in order for the daily charts to have a chance to turn bearish.  Although the daily has not turned bearish it is closer to its goal.  We have not been getting any acceleration due to signals out of range from the OB/OS conditions.  The lower time-frames will react first and manipulate the larger time frames so if you are watching the intra-day charts, then watch any time frame to hit the OS/OB range.

SEN: Bearish
ST: DOWN
PA: NA

Note: Some cycle analyst are looking at the 2020 level for a low... I cannot confirm this but it is a level to watch.  2020 is also the 75 day MA...

10 Nov 2015 - Still

Price has closed under the 75 MA of the 60 min. chart and has kept the market relatively flat for the day.  The PA was not signalling any volatile movement currently but that could all change tomorrow if the signal still holds the downward pressure and into the OS range.  The next level of support is the 200 day MA currently at 2063 SPX, then comes the 2040 which is held by the 200 MA of the 60 min. chart.  Until we pass these markers, we cannot see any acceleration in large spreads.

If however the intra-day signals turn bullish tomorrow,  we should be cautious of the turn back UP for the ST as the daily chart is still in a bullish sentiment.

SEN: Bearish
ST: DOWN
PA: NA

9 Nov 2015 - Possible CIT

The signal is now out of OB, which is encouraging for bears but can we call this a CIT?  No, but what we need to see for tomorrow is for the intra-day charts to stay in bearish territory in order for further downside action to occur from the ST.  Prices in the SPX is now resting just above the 200 day MA, and a Gann Angle drawn on our daily chart.  These clusters of support needs to be broken in the following days for a more convincing short trade.

According to the ST though, is that the sentiment has changed short-term.

SEN: Bearish
ST: DOWN
PA: NA

6 Nov 2015 - 75 MA Bounce

Price in the SPX bounced on the 75 MA  of the 60 min. chart as I anticipated now for a few days. This bounce is just short of the 2080 by 3.74 pts.  Currently the signals in the intra-day is bullish while an ST that is on an UP trend.  Therefore there is a higher probability of a move higher.  If the intra-day signals can stay in a bearish position next Monday, we can look for lower low in prices, with a support at the 200 day MA at 2063.

SEN: Bearish (Will turn bullish next week but won't print until EOW).
ST: UP
PA: NA

Note: although the SEN: indicator will turn bullish again next week, I have to warn that the signal will be within the perimeter of the line between being bullish and bearish.  Therefore any trade long or short should be approached with caution until the signal has finally distance itself from the border.

5 Nov 2015 - Still Bullish

Despite the negative day in the SPX, the overall sentiment short-term is still bullish.  The signal did push lower but still in OB territory so there is a lot risk to the upside at this point in time.  The intra-day charts today is a bit more bearish but still OB.  I mentioned that signals would need to push into OS and stay for a prolonged period to give a more sustained move lower.  This has not happened, so we look to tomorrow to see if we can get a picture of how the whole week has formed.  Being in this state however, I can tell you now that if we do not push lower tomorrow then the likelihood of the SENTIMENTS turning Bullish is very high.

We are on that line now and a push into Bullishness might not necessarily be bullish in that a performance the next week if bearish could flip it back to a bearish camp.  This scenario is where we need to call for a more cautious approach.  Therefore, the safe side of the trade is always near any OB or OS situation where you get low risk entry and price acceleration probability.

SEN: Beairsh
ST: UP
PA: NA

4 Nov 2015 - 2080 Revisit

With the SPX intra-day signals at a bearish state, price could continue to the 2080 level where the 75 MA of the 60min can be found.  I am going to be cautiously bearish here since our ST is still in OB.  When dealing with a smaller time frame in anticipating what the ST might do, we need to remember that if we are to put a short position on that we would only assume a temporary trade to the downside since the trade is not in agreement with the ST.  This should remain temporary as such, until the ST can turn down as well confirming the smaller time frame.  Only this scenario would you to add to the short position or keep the existing short.  The longer the signal stays in OS also will indicate the strength of the downward direction.  Reversals often sports a quick reversal from their extreme range.

SEN: Bearish
ST: UP
PA: UP

3 Nov 2015 - Counts Are Getting Stupid

As you can see from the chart below the counts are getting to be stupid, but this is the nature of EW.  Countless editing and options laid out on the table, and little by little replaced by another count or nullified altogether.  The most important thing here really is to recognize the phase of price that we are in and as suggested by the ST in early Oct. it was up.  Amazing how we always look back and say "why didn't I follow that".  Well, like I have mentioned in the past.. Human emotion and instinct are driven to be better.  It is not that we cannot beat an indicator or a theory, the question is the consistency of your strategy and theory vs the consistency of the indicators.  I write these blogs to constantly remind myself and learn from my analysis what works and doesn't work, and find enlightenment when time over time, indicators always come out the winner in the consistency category.  Of course, if you do not follow your own rules, no indicator can remedy the mistake or loss.

So far today everything has stayed relatively the same as yesterday.  New highs as we anticipated in an OB reading.  This will continue to be the higher odds when in this environment.

SEN: Bearish
ST: UP
PA: UP

As always to confirm a move lower, one should look for a move to the OS by the indicators in the intra-day level for us to anticipate that a CIT or a short term move lower has occurred.

2 Nov 2015 - OoPs..

This is the type of moves that happens when conditions are OB.  Despite what I am inclined would happen (which is a turn down at the least).  The indicators have once again been the one who told us so.  The OB and Up-trending condition the indicator has been is pushing prices to extreme.  Is this a run-away bull market?  It is close and a push to higher highs would either put us in a larger degree Neg. Divergence or a new bull signal on our "Sentiment Signal".

As it stands, nothing has changed in our indicators...

SEN: Bearish
ST: UP
PA: UP

30 Oct 2015 - Good Start For Bears

Can I call a top here?  Well... not really, but it is a good start with the intra-day signal falling into bearish territory.  The best way to confirm this is if we can get out of the OB situation that the ST is in and maintain a bearish stance on the intra-day signals.  Sounds confusing? It gets easier once you start practicing this way of analysis on a daily basis.

The bigger picture lies in the Monthly chart since it has closed today.  I have to say that it does look like a compelling argument for a bull market, but the signals are still open to the downside and anything can happen in Nov. to change the bullish stance.  So we should try to keep within last months range for a bullish sentiment or fall below it for a bearish sentiment.  What I just said here is that its pretty much a do or die for bears or the bulls regain control of the market.

The start of a new month and week next trading session will need to show us its intentions...

SEN: Bearish (On Verge Of Turning Bullish)
ST: UP
PA: UP

Note: If this is a W2, then it is definitely performing its role as advertised..

EWI - " Wave two corrects wave one, but can never extend beyond the starting point of wave one. Typically, the news is still bad (Good in this case). As prices retest the prior low (Highs in this case), bearish sentiment (Bullish in this case) quickly builds, and "the crowd" haughtily reminds all that the bear market (Bull in this case) is still deeply ensconced. Still, some positive (Negative in this case) signs appear for those who are looking."