we got MACD crossover on daily for ES.

northam,

in the long run I think the superspike's main contribution or impact will be as a conversation starter.

It will be somewhat like the "Crash of '87". Which, by the way, was blamed at the time on automatic computer trading.

I was away from the computer when the superspike happened -- I tend to not be a day-trader. I probably would have been paralyzed, and not have known exactly what to do while trying to figure out when to do it and by how much, if I had been watching it live. I would have obviously missed the sweet spot in terms of buying something. And as luck had it's way, none of my stocks were significantly influenced by it anyway, at least in my present time perspective and point of view. I was surprised to hear on the TV that a few very well known big stocks went practically to zero. What I find interesting is that when I later brought up a screen full of sector charts, many of them hardly budged and some of them moved a lot more. One healthcare sector ETF I track actually dropped 27% that day, and yet even after the drop on Friday (yesterday) it is only down 4% from where it's high was on superspike day, and 0.7% of that 4% drop was on Friday and it actually traded up about 0.7% part of the time on Friday.

I'm a fisherman. Most of the time I'm a caster, in which case it's all about feeling the line. Once in a while I want to take things a little slower and easier so I use a bobber, in which case it's all about distinguishing between tugs on the line from the deep and the ocean waves or ripples in the pond. Either way, Superspike Day doesn't tug my line.

------

As I recall, you might be using Highs and Lows to calculate some of your averages for the purpose of making channels. If that is true then that day would have really nudged a line which is calculated from Low data, and it would take some time to filter that out -- lingering memories of a distortion. I'm still encouraged to filter out outlying data. The extreme outliers are sufficiently rare that it makes it virtually impossible to find enough of them to do a statistically significant backtest.

JLS - "Statistical comparison of SPY prices over the last 15 years indicates roughly 90% chance that SMA(320) will be tagged. That 90% says that's worth waiting for because I can buy in at lower prices. I don't count that super-spike of a couple weeks ago as a serious test of SMA(320) -- statistically, outliers should be filtered."

In the long term does the super-spike really have much impact?

I would think the super-spike would have the most impact with the Day Trader, the ones using the minute charts.


If you go back to this post, you will see that the super-spike had historical significants concerning the weekly cycle.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=50229552

northam -- not exactly

All I did was describe S/R lines and the range between them. Their application is up to you.

I'll try to change my language so it is easier to understand. I tend to write in the same style that I think, and my thought process is confusing to many. [In fact, there are often times when much later I don't even understand my own earlier writing.] What I am doing is describing two S/R lines that I found by computerized search. Each line is roughly centered within narrow price ranges where there have been many price reversals over many earlier months. For each line, the price range I used for the purpose of counting reversals was +/-200 cents. One of those lines is at 1104, while the other is at 1068. The number of reversals for those two lines were 25 and 21.

[ The range number I stated in the earlier message, +/-300 cents, was a mistake. I just checked, and it is the smaller number in the above paragraph. ]

Those two S/R lines are relatively close together when compared to recent daily trading ranges. Therefore, those two lines could be combined into one line drawn at 1086. In equation form: (1104 + 1068) / 2 = 1086 That value is what I called the middle of the range in the earlier message. It has nothing to do with the +/-200 cent price range used in searching for daily reversals.

I prefer not to combine the two lines into one, mainly because there are an unusually large number of reversals defined by each line, and no other S/R line of fewer reversals between the two were reported by the program. This is a very uncommon situation.

I'll stop here for a short explanation. The program looks for a minimum number of reversals before it reports a count. I set it to 3. The reason for this is that a count of 3 or less over a period of months usually doesn't have much effect on trading. If they were clumped together in time, and were recent, they probably would; if they were spread out in time, they probably wouldn't. So there could be reversals between those to major lines, but the program didn't report them.

So I think of the two S/R lines as simultaneously defining a very narrow trading range within which price can exist when the price swings are small enough (which isn't all that easy with today's volatility). Or I think of these two S/R lines as defining a "hard" S/R band. I emphasize "hard" because it is wide enough to make it difficult to step over the whole thing in one day, but not so narrow that price can't trade within it. So, maybe this is why I described it in such obscure ways. Or ... maybe you still don't understand me and I have to try again.

I hope this helps. And while I hoping, I hope nobody tries to replicate the method; because they wont be able to get my numbers. I use a statistical weighting on each reversal -- if it's far away in price, it's depreciated in value because it will have less emotional effect; if it's close in, it's appreciated in value because I think it has greater effect. In other words, each reversal doesn't count as exactly 1. Another reason I did the nonlinear processing is that many traders try to predict turning points, so they tend to jump in before S/R levels are reached, so I try to account for that by artificially promoting the lines as current price gets closer to the historical S/R levels. It's just an experiment. Some work, some don't.

-----

My personal interpretation of their application has not changed. Price is below both the upper S/R line and SMA(200), therefore price is in correction.

Both daily SMA(8) and SMA(20) are down, therefore price trend is down.

The same is true for weekly.

Statistical comparison of SPY prices over the last 15 years indicates roughly 90% chance that SMA(320) will be tagged. That 90% says that's worth waiting for because I can buy in at lower prices. I don't count that super-spike of a couple weeks ago as a serious test of SMA(320) -- statistically, outliers should be filtered.

Next time I turn on my charts, I'm going to check the history of SMA(20) tagging SMA(200) during corrections. SMA(20) is dropping fast enough such that it may be something worth waiting for and taking more into consideration.

JLS - Pardon my ignorance. But most of what you have said is above my pay grade.

What I got from your post was. The current trend remains down and the top currently could be around 1104 and the low could be between 1020 to 1068.

The S/R range for $SPX was 1075 to 1105.

That range defined a S/R line that would be placed at 1090.

That data is now several days old. I ran a new computer search this morning to incorporate all data through yesterday's close. I did this to incorporate yesterdays high and close which were slightly below the high end of the range, previously defined as 1105; and also to incorporate the few trading days prior to that which had a propensity for all of the last six days to open or close just below the lower end of the range previously defined as 1075.

The result is that the high end of the range is now 1104, while the low end of the range is 1068. Therefore, the middle of the range is now 1086, a downward revision. This is the new, slightly adjusted S/R line.

The search for both the upper and lower end of the S/R range were separately defined, but simultaneously searched (whatever that means). So they are not to be considered as trading ranges; they are simply values at which price reversals sere clustered.

The upper value of 1104 contained 25 reversals within a window of +/- 300 cents. The lower value contained 21 reversals with the same window size. There are no large clusters of reversals between those two values; and there are no large clusters of reversals immediately outside that range.

The only looming thing on the low side of that range is SMA(320) which is near 1020. The only significant things on the high side of that range are SMA(200) which is very near 1105, and SMA(20) which is near 1125. I think it is interesting that the value for SMA(200) appears elsewhere in this message. Perhaps it adds a little more resistance to the upper edge of the S/R band.

Mongo
Hows this BIG UP move doing this morning. LOL
Dan

Lets hope we keep getting this volatility.....easy pickings!!! HEHE

SPX Monthly Cycle Historical Info:

SPX Monthly Cycle Phase I for the Period Nov 97 to Present:

There have been a total of 11 Monthly Phase I cycles.

One lasted 31 months. Ended April 2003
One lasted 18 months. Ended June 2009
One lasted 7 months. Ended June 1988
Two lasted 4 months. Ended August 1994, January 1991
One lasted 2 months. Ended September 1988
Five lasted 1 month. Ended Jul 06, Aug 04,Sep 98, Dec 94,Feb 90

Phase I Cycle Starting Years since November 1987:

2008
2006
2004
2000
1998
Dec 1994
Apr 1994
Sep 1990
Feb 1990
1988
1987

>>I guess that I am going to have to make my posts very, very simple.<<

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=50666330

Forget about simple, you have that covered....how about getting something right...just once before the year is out.

If I see crossing stock.(up) on weekly I'll be fully in.CCI20, Sto./Rsi- everything up. In the mean time it didn't happen.

we were just a little early...pattern repeat starting to correlate now...

FYI, 20DMA is crossing down 200 DMA on ES. It's very bearish IMO, because last time when we crossed it up was May 2009 and we never looked back.

northam,

I don't think I ever said what is going to take price lower. And I don't believe I ever said when price will tag SMA(320). My opinion is only based on what the charts show has happened to SPY over the last 25 years. The charts for SPY don't say much before that because it didn't exist long enough to have an SMA(200) or SMA(320).

I've also observed -- from the history -- that SPY very often makes a concerted test of SMA(200) after attempting to tag SMA(320) and before making the final drop to eventually tag SMA(320). This is interpreted as a double bottom. The second bottom may be at a higher level because SMA(320) is usually on an incline during a correction. Therefore, if it takes enough days for price to turn back down toward a rising SMA(320), then that price could be a higher low and still tag SMA(320) because it was coming up to meet price -- he redundantly said.

This could all take place within the next week or two or three -- whatever -- provided no new bad news. My opinion is that a second approach of SMA(320) would be the bottom of this correction. I wouldn't be surprised if the market makes a new yearly high after that then goes through another significant corrective cycle before the end of the year. The earliest that the second corrective cycle could start forming would be August/September, after the earnings releases of July. Remember those bad ol' days when it seemed there would be corrections every September/October? I think they are due to come back.

I've looked at $SPX prior to 1995. It often looks pretty ugly -- long periods of consolidation where SMA(200) and SMA(320) play footsie with each other, and trending markets where the two averages maintain some space from each other but are close enough to make you nervous. I suppose those are the years where it made sense for conservative investors to only buy stocks that paid good dividends.

JLS - It's possible that SPX gets to 1018. The SPX Daily Phase I has completed 18 trading days. The average Phase I lasts 5.58 trading days. So the down side now seems less likely in the ST. The average Daily cycle high/low diff is 74.19. The current cycle high/low diff is 49.94. So that is currently 24.25 below the average. The current cycle high is 1090.75. So if you add 24.25 to 1090.75 that comes to 1115. The current upper trend line price is 1116.98. Tomorrow that price will drop below the 1115 level. I am expecting a short Phase II period with the current daily cycle topping out around 1120.

The SPX weekly Phase I is now in it's 3rd week. The average Phase I is 8 weeks. The current weekly cyle low is 1040.8. So a high probability that the cycle low is not in yet. The average high/low diff is 95.81. The current high/low diff is 49.94. So this cycle is currently 45.87 pts below the average. So that means this cycle could go as low as 994.93 or a high of 1136.62. Or some where in between the high low. I'm expecting the low side. If the low were to be 1018 then the high would be around 1113.81.

The Monthly SPX the EMA 3/8 now has a gap of 16.16. So the gap has slightly narrowed since my last report. So unless we get a major crash on Thursday & Friday. I doubt a EMA 3/8 bearish crossing will be confirmed by end of month. That would mean in June the SPX could go much lower, recover and resume the bull run by July 1st.

Bottom line: I believe we have both came to the same conclusion. The SPX will go lower. We just differ on what takes it there. But in the end that doesn't matter if the system is consistent.

JLS, thank you very much for your view.

Northam,

I’m sticking with my prediction that SPY (and obviously $SPX) continues down, to tag SMA(320), which is now at 1017.58 for $SPX, and slowly trending up.

I did a computer study of all the major sectors and indexes (usually represented as ETFs, such as SPY for $SPX, XLU for Utilities, XLF for Financials, etc.) a couple of days ago in order to find the most prominent Support/Resistance (S/R) level of each. Many of the sectors have fallen below their respective levels. That level for $SPX turned out to be 1090, so that would be resistance now. I did the search by first picking a price window (+/-50 cents, +/-100 cents, +/-150 cents; whatever, depending on the current value of the ETF being analyzed) then counting the number of price reversals over the last 10 months on a daily interval. By a large margin, there were two prominent S/R levels for $SPX, one at 1075 and the other at 1105, for an average of 1090. Virtually all of those reversals in $SPX happened between the middle of last October and the end of last February. In three of the last four days, including today (so far), price has tested that level but closed below. EMA(320) is now at 1087.18, and trending slightly down as of four days ago.

So far for today, $SPX has been either a doji or a spinning top. Daily CCI(20,1) has been trending down and is close to testing -50 for the first time since the most recent price peak on 5/12/2010. CCI tested its Zero line on 05/03/2010. Drawing a straight line between those two dates intersects today’s CCI at about -96.

SPX Cycles Update:

SPX Daily: This is the 17th Trading Day in Phase I. The average Phase I is currently 5.56 Trading Days. The price is below the lower trend line(1093.24). A new cycle low of 1040.81 was made today. That is within my target range. Since price remains below the lower trend line, new lows are still very possible.

SPX Weekly: 3rd week in Phase I, new weekly low

SPX Monthly: 10th week in Phase II, EMA 3/8 18 pt gap.

SPX Weekly cycle:

Last week the SPX weekly cycle Phase I hit a low of 1055.9

That could be the cycle low. However, at this point the weekly is still below the lower trend line. So a new low is still very possible. When the price rises above the lower trend line, then the probability of a new cycle low will diminish.

This is the 3rd week of this weekly Phase I cycle. The average weekly Phase I is 6.5 weeks.

What would it be worth to you to know what the stock market index levels will be next year, month, week, day or hour. Here at Index Insight I am calling the index direction and target prices with what many call "amazing accuracy".

many??? name ONE!!! HEHEI HAVE HEARD MANY CALL YOUR MARKET PREDICTIONS LOTS OF THINGS...NONE EVEN REMOTELY CLOSE TO "amazing accuracy" HEHE

northam,

FYI, my remarks related to SPY, not $SPX. There are tiny differences.

There is what I call a noise difference which is the daily tracking error. This is usually quite small, yet can be fairly large during significant rare events such as the flash crash of a couple weeks ago.

A long-term difference is caused (I think) by the fact that SPY pays dividends while $SPX does not. This can usually be seen as a singular event on the daily chart every three months, then its effect is averaged into the data over time by the fund managers in order to produce a smoother correlation between SPY and $SPX. Another source of long-term difference may be due to a small management fee to produce SPY.

The long-term effect (and noise) can be seen in the first chart below. It is a 1-year chart -- I think the upward slope over a year reflects the gain in SPY due to dividends minus fees. But that might just be my fantasy. The second chart uses only daily Closing prices instead of the daily OHLC values of the first chart.

http://tinyurl.com/2ecclet

http://tinyurl.com/252s5ka

NASARAVI - Yes it looks like an EMA 3/8 crossing may be made but confirmation maybe another thing.

I was just playing around with the monthly cycle high/low numbers since 1990. I made an interesting discovery.

from Feb 1990 to the present there have been 9 monthly cycles to include the present one.

The Diff between the low of previous cycle and high of next cycle was at the minimum 160 pts and the maximum of 1110 pts. Except for one time. The previous cycle low was 1224.54 the current cycle high is 1219.8 a diff of -4.74 Why would this cycle be way off from all the rest? Unless this cycle is not quit ending yet. To get within the norm the current cycle high would need to get to atleast 1385.29

So could that mean we hit the monthly cycle low 1000 - 1040 then head to 1385? To avoid a monthly 3/8 EMA confirmation the SPX could go down to the lower trend line next week and bounce avoiding a 3/8 confirmation then in June go down and extablish the low of the year, then return to the cycle Phase II upper trend line(1134) before the end of June. That senario would negate both the EMA 3/8 crossing and a new monthly cycle.

This scenario is making alot of sense to me. That -4.74 just don't seem right.

Here is the data that I have in case anyone wants to verify:

2/90to8/90 cycle low 322.10 high 369.78////482.85-322.10=160.75
9/90to3/94 cycle low 294.51 high 482.85////477.59-294.51=183.08
4/94to11/94 cycle low 435.86 high 477.59///1190.58-435.86=754.72
12/94to8/98 cycle low 442.88 high 1190.58//1553.11-442.88=1110.23
9/98to9/00 cycle low 939.98 high 1553.11///1163.23-939.98=223.25
10/00to7/04 cycle low 768.67 high 1163.23//1326.70-768.67=558.03
8/04to6/06 cycle low 1060.72 high 1326.70//1576.09-1060.72=515.37
7/06to12/07 cycle low 1224.54 high 1576.09/1219.80-1224.54=-4.74
1/08toPresent cycle low 666.79 high 1219.80

northam43:

Based on weekly charts, monthly 3,8 cross is inevitable in the next few days.

We will wait for your charts to lead us the way.

I gut feel says that this whole run from Mar 2009 till April 2010 is a three peaks and a domed house scenario and the point 28 should test point 10 (869), which also is a 62% retrace of the whole run. Timing is what I cannot predict.

I consider 23 as the top at 1219. 1065 was point 24. We did finish 25 (at the recent SPX high at 1173) and are on to 26 at 1000-1040 (your note). We get one more up to 27 and then down to 28 (at SPX 869) to finish the domed house.

It could bounce first at the 320 dma and then make a lower low later.

Regards.

JLS - Very good info. Thanks.

Right now on the SPX Daily the 320dsma is at 1014. That fits right in with my projection. I notice in July 1996 on the SPX it did not go all the way to the 320dsma but was pretty close.

Now if it breaks the 320dsma that could signal a new bear market. But the monthly EMA 3/8 would have already confirmed that.

Northam,

this pertains to Bull market corrections:

During the Bull market that started late 2002, early 2003, every correction in SPY which closed below its 200dsma (as it will likely do today) also at least tagged the 320dsma sometime soon after. The first time this happened was in August, 2004 (SPY of 107). The market rose after that then very nearly (within pennies) tagged the 320dsma again in September, 2004 (SPY of 109). The next times were: April, 2005 (SPY of 115); October, 2005 (SPY of 117.50); June and July, 2006 (SPY of 124); then three more times in middle-through-late 2007 (SPY in middle-to-low 140s) which was the end of that Bull market.

The same process played out during the period from 1994 through most of 2000.

Dare I state the obvious, SPX is now significantly below its 200dsma and will likely close there today. Another obvious ... during Bear markets SPY does more than just tag SMA(320); it stays below, and it spends most of its time below both its SMA(200) and its SMA(50).

If SPY closes today below SMA(200), based on history it is a virtual certainty that price is headed for at least a tag of SMA(320) fairly soon. That would be near a SPY of 102.

Yet another very interesting point: for all cases between 1994 to present, the SMA(320) and the EMA(320) have had nearly identical values as price crossed between Bull and Bear. Those two averages are not anywhere near equal at this point in time. The difference is historically significant and is approximately 7 SPY points. That difference might have something to do with how far price was below those averages at the market bottom in March of 2009 and how fast price moved up thereafter.

northam43:

Thanks for giving us the heads up. As far the daily goes, you were indicating the possibility that the cycle may extend and that may be happening. Also, weekly indicators are far from crossing up also.

Regards.

SPX Monthly EMA 3/8 ALERT:

The SPX monthly EMA 3/8 is now on my radar screen. The current gap is 20 points.

The current EMA 3 price is 1119.88. The EMA 8 is at 1100.13.

There is 7 more trading days (not counting today) left in this month. So at this point the chances of a bearish crossing is high.

I will post daily updates either until the crossing is made or the risk level is diminished.

I believe you pretty much got it. But don't leave the Daily out. The Daily may tell us how deep this correction is going to be. I thought by now that we would get a Daily Phase II and then back down. So since that hasn't happened yet, I expect this is going to be a long Daily cycle. The record for the Daily cycle Phase I is 26 trading days that was Sept 23rd, 2008 to October 28, 2008. That was during a bear market and if you look at the weekly during that time. It was nasty.

Yeah, all two of them (subscribers)...

However, "Scamman" is actually another trader from the old Clearstation days. Wouldn't want to tarnish his reputation by wrongful association.

northam43:

Great response.

"I would say hold and wait for monthly confirmation."

Rules:

1. 3 crosses down 8
2. PPO crosses and goes below zero
3. Price opens below UTL

Looks like the above is the order in which it should happen.

Maybe, weekly will give us a clue and serve us as a canary in the mine.

Comments?

TIA.

NASARAVI:

"The question is will the monthly turn down."

That is the 6 Billion Dollar question. We just have to watch the Monthly EMA 3/8. If we get a bear crossing. I would say hold and wait for confirmation. If we get confirmation then we go into Bear mode for 9 to 12 months.

I'm just expecting a one month SPX monthly Phase I cycle. Going to the low 1040 - 1000 then July go to SPX monthly Phase II for 4 to 15 months, nice ride back up to 1200 by end of year.

Some would say I have all my bases covered. The upside & downside. When a monthly cycle starts to develope, you want to pay alot of attention and be ready to change direction. Because a monthly cycle can have a BIG IMPACT.

northam43:

Thanks for your SPX cycle update. Looks like your 1040-1000 target will be hit soon.

The question is will the monthly turn down. How does that fit in since you mention that July may be up?

Appreciate for your concern. I will be fine since I am in R&D.

Regards and TIA.

I know North, Thank you. No buy signal yet. If we get ~ 1040-1050, it should be very brief. JMHO.

SCAMMAN SAYS>>I will not be giving my positions through the day any longer. It is not fair to my subscribers. I may give a recap at the end of the day that, of course, can be verified in the Trading Pit.

NOT FAIR..I THOUGHT MISERY LIKED COMPANY HEHE

OF COURSE THE "RE-CAPS" WILL ONLY BE UNPROVEN PROFITABLE TRADES HEHE

Rab - Just think, you can buy some more at a lower price. So far every monthly cycle Phase I has at least hit the lower trend line(LTL)price. The current LTL is at 1046.68.

Thank you, North. The lower BB on weekly is 1052, so your target is possible. I hope we don't get there. I'm long on my youngest daughter educational plan- large cap on TSX.
My trading account in cash

SPX Cycle Update:

On the Daily chart the UTL is now at 1158.6. That is a drop of 6.87 from yesterday. So now that could put the UTL at 1152 on Thursday and 1145 on Friday.

Current price level is at 1114.3 which is below the lower trend line (1130.57). I would expect resistance at the 1130 level. So, I now am doubtful that the UTL will be reached by Friday and that the current Daily cycle Phase I will more than likely be extended into next week.

Since the Daily cycle will be extended I would also expect the weekly cycle to be extended.

The monthly is now below the UTL price(1134.95). So a new monthly cycle Phase I has a good chance of starting on June 1st. I still believe that a new monthly cycle Phase I will be of one month duration and the bull market will continue in July.

My projected low target is currently 1000 to 1040.

The +D is still there. We just touched the lower rail of regression chanel and that's why I called for 1100. First I called for the low when ES was 1127, now it's trading 1104. We are under 200DMA for ES and above 200DMA for cash.
I think it will hold. The low is close, or the bear market is back.

if 1100 holds will it affect your +D...?

The sarcasm war continues.

NOW PS is saying that his latest remarks to Sstingrey was sarcasm.

http://tinyurl.com/2g82azg

I don't think so. PS is just too naive to understand sarcasm.

Isn't it obvious? He always did what the market did, he just didn't telegraph it ahead of time. Who *is* his broker???

interesting indeed -g-

I know I sound like a broken record, but the +D is there. I will not go long anymore, untill it will be resolved, but I see what I see and I can't do anything about it.

WANNA LAUGH...READ THIS>> Market Talk 4/29
« on: April 29, 2010, 06:45:21 AM » Quote

--------------------------------------------------------------------------------
Based on my calculations using the current evidence and the most probable outcome, we will hit 1250 top on Monday May 10th.


UHHHHH NOT EVEN CLOSE POKERSCAM...HEHE

ANYMORE W.A.G. YOU CAN "CALCULATE"? HEHE

agree, North.
We are under 20WMA, CCI20 under middle line on weekly, Sto. facing down, MACD crossed down as well.

I was panished today by trying to go long.a bad day for me so far.

SPX cycle update:

On the Daily chart, the upper trend line(UTL) price has now dropped from 1174.22 to 1165.47 a drop of 8.75 points in two days. If this continues on Thursday the UTL will be around 1157 and on Friday it will be at 1152.

I still believe by Friday the SPX Daily may hit the UTL and then go lower. That would then start a new Daily cycle and it could then push the weekly to new cycle lows.

LOL...!

no better trader than PS...he seems to nail it every time...that takes special skill...

POKER...who is this broker that allows you to sell your calls at 3:15 yesterday afternoon and again this AM???? WHATTA DEAL THAT IS!!!!LMAOHEHE

If today closes below ~1135, will exit longs

If it breaks ~1150, will add longs

in between will hold

Rab - I see to many bearish indicators in all time frames.