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Technical forecast for the S&P next week!
Hello fellow iHubbers! After doing some research into the short and intermediate term trends, I have come to a confident, yet uncertain market forecast for next week.
For next week, I'm calling it bearish, but with some bullishness in mind.
The commercial hedgers seem to be setting and adjusting their umbrellas for some rainfall. Last week, commercial hedgers added about 77,000 short contracts and 42,000 long contracts. Not only that, but they also added 6000 long T-Bond contracts and closed about 9,000 short contracts. The hedgers seem to be flat out telling the market that they think this market is going to experience some bearishness.
Also, looking into intermarket connections, I found the CRB index (Commodities index) to be experiencing some short term correction. It gave us a strong reversal day signal on friday's close, accompanied with strong sell volume and an overbought market. The US Dollar, however, is not sending us the same message. The dollar has been steeply declining these past couple of weeks, which is initially bullish for the markets. The effect on stocks, however, is somewhat lagged, but the intensity of the decline tells us that the possibilites of next week's bearishness being a correction are very likely.
And finally, the S&P itself!
We have 2 reversal day signals here. One on the weekly chart, with heavy volume and 60 RSI(Kind of a faint reversal strength, but still somewhat effective), and one on the daily chart. Both signals show of a confident market decline. I also noticed that the S&P is hitting a brick resistance level of the January 2010 highs (This market needs more strength to break out upside because i see many resistance levels ahead.) I do expect a decline, but not very heavily. The 200 daily MA should do the trick.
I must caution here, however, that there is still a slight possiblity we could break out to the upside, and this should be watched by a decisive close above the 1157.16 resistance. Any close above here would confirm more upside.
In conclusion, I think next week we could be experiencing a correction.
And i'd like to let you know that I'm 17 years old, so i still have a lot more to learn. And I am currently reading up on any investment book i can get my hands on. I look to recieve my CMT license after high school. I'm not saying im better than everyone else on this blog, nor am i saying that any other method of analysis is incorrect. I'm only here to try and share my analysis with the rest of the community and my view on the market.
I have no idea how this dispute started, but I will very much end this right here. I am here to provide my opinion on the market, like everyone else. So you stick to your methods and your opinions, and I stick to mine. Any disagreements you might have with my analysis, i suggest you keep your disagreements friendly rather than "throw off" my opinions. I'm sure if there was a "TA Arguement Room", it would be made somewhere on iHub, but this is a room for SPY, and I intend to keep it that way.
i will try to remember this call till 4PM friday.
so with 23 years of experience, enlighten us on what tools you use to trade?
Stay posted for my analysis for next week,people! It will be posted tomorrow
John J Murphy is the Benjamin Graham of TA. He has many years of experience. Any1 looking to study up on TA should read his book "Technical Analysis of the Financial Markets"
yes it is. i have been trading since feb. '10. Now I'm not saying im a better trader than you. I kno I'm a newbie at all this. However, I have had much education within that time frame. The point I'm trying to make here is that you think TA is a bunch of hooplah, from what I'm hearing. I'm here to say it isn't. And I have many arguments, if you'd like to hear, why TA is a good method of analysis to use.
spdpro > you may want to read this a few times
"Technical Analysis of the financial markets"
by John J Murphy
Mid-week technical analysis-SPY
Wow guys, what a day! I saw that 0.70% drop this morning and i was starting to doubt this rally. But as i saw that rally up intraday, I was impressed by how much bullish pressure really is on this market.
There is something interesting I want to point out in this rally:
1. Consumer confidence was lower than expected.
2. Housing data didn't look too pretty.
However, we managed a 0.50% Green day.
How can markets possibly rally on such bearish economic news??????
There is obviously something bigger going on here. Investors aren't turned by this horrible economic growth. Perhaps all the gloom and doom has already been discounted in the market. Perhaps investors are bullish on the upcoming decisions of the federal reserve? Maybe its all the M&A's going on. Or maybe it's just that investors are bullish on our economy, despite the slow growth.
Remember, slow growth is growth nonetheless. And growth in the economy pushes markets higher.
Also, the dollar and commodities continue to decline, which is a good thing. The bond market is starting to turn, and since we have an inflating dollar, bonds and stocks are starting to turn in similar directions, rather than diverge.
Conclusion, our market will be up up and awaaaaaay!
For now atleast...
See the only problem with freestockcharts is their availability of indexes and index indicators. and their cycle tools and they are missing some indicators. Also futures charts
other than that, its great.
omg lol. Why u guys buying block buster stocks? They're going bankrupt for godsake. It won't look on technicals or fundamentals. It's a speculating frenzy in this room. lmao
i use trademonster. They are absolutely awesome. customer service A+. Trading tools A+. Commisions could be a tad bit lower, though. Especially for options. But other than that, i absolutely love these guys.
As for optionhouse, I absolutely hate them. Their account value number is messed up, it gives u incorrect P&L. Their customer service is horrid. The only thing good about theses guys is their low cost comissions.
I want to give thinkorswim a try. Is anyone using thinkorswim? any feedback?
honestly, freestockcharts is the only one im using, however i am saving up for metastock or some advanced charting program. I need access to cycle tools, futures, and other indicators as well.
Freestockcharts, in my opinion, is THE best free charting software to use on the web.
to bridgeofsighs,
yes, the 3 declining candlesticks should be contained within the first body of the long up day candlestick, however, the pattern confirmed itself with a long up day on the 5th day. The 5th day is also supposed to break anew high, which it hasnt yet.
The pattern looks very likely, and is just one of many signals that call for some upside. If you were to be long SPY based on this pattern itself,however, it would be mere speculation.
I call for upside based on other facts as well, not just candlesticks patterns.
Your input is appreciated, though.
thanks northam.
anyways, i would like to stick to the subject of this board
I've done my analysis on friday, and things are looking pretty good people! We have a confirmed weekly breakout, bullish consensus numbers are rising dramatically (Far from overbought), and we have a rising three methods candlestick pattern forming in our past week, which is a bullish continuation pattern.
After reading the Commitment of Traders Report, I found that commercial hedgers got stopped out of many longs and shorts. This was not a good week for the institutions. Haha. However, what i do see, is that the institutions are shorting T-Bonds, 9000 long and 19000 short. When bonds go down, the market goes up. Therefore, if the institutions are going short, it's telling you that they expect an advance in the market.
The dollar is breaking out to the downside, possibly inflating our market higher. The Commodities Research Bureau Index is also breaking out to the upside.
I am going long SPY, but setting a price target from here is going to be difficult.
Inverse head and shoulders pattern: $125
Weekly 200 DMA: Possible $118
It is safe to say that we give this market a price target of $118 for october!
Please let me know what you think of my analysis. Honest feedback is appreciated!
hehe you didn't understand what i was tying to get at here.
It's not about the 90%(Sorry i do belive that is overrly exaggerhated) or the elliot waves. It's about proving a point that technical analysis is a very accurate method of analyzing securities.
And plus, I don't even use elliot waves that much at all. I only use it when i try to find a price target for a trending market. I am a hardcore believer in technical analysis and I find it funny that people blow off this method, "saying past prices can't possibly predict the future" when every method of analysis out there, like weather forecasting, is based on past data. Even fundamental analysis uses past data
But, northam43, what i really find sad is that some of the people on ihub are mere speculators, who have no idea what they invest in, have no knowledge of a securities background, etc. And here they are, criticizing TA.
ah cycle analysis
one of the best methods to use.
you guys, i wouldn't sell short just yet.
I see a bullish rising three methods pattern formin here. If we get a decent close above the open, I see some room for more upside. This looks like a confused day, with the gap up and all. I suggest waiting for the close and making an overall analysis for the week before jumping into any positions. I've been whipsawed like crazy these past few days, don't make that same mistake
Lol ok sir. I've been right on 90% of the calls I make using elliot waves and technical analysis. Technical analysis leads the fundamentals, like what the fed does, inflation, corporate news, before they are actually out.
What you call "BS" is actually a much better method of trading than anything you're using. So I suggest you keep your rude comments to yourself.
Technical Analysis! Please read if you are long SPY!!
You know, i got to say. I was pretty confident in this bull market when it broke it's support line. But today we have a problem. Sure the market hasn't retraced that much of our prior rally. But today we seem to have formed a strong reversal day signal.
This is called the downside reversal day. It is when the market sets a new high in the trend and closes below the close of the last day. These signals by themselves are not much significant, however when mixed with other indicators, they can be very reliable.
The RSI indicator is extremely overbought, and the volume today was exceptionally high. These two indicators support the possibility of a bearish market.
Also, i noticed that the high paused at the January 2010 highs, which has now become a confirmed resistance point. All signs are pointing downwards.
How far down this market will go, I'm not sure. However, by applying the elliot wave theory on this market, it looks like this could just be a correction, maybe to the 38% or 50% retracements.
In conclusion, my theory is that the markets should close down for the week. If we manage to bounce off retracements in this downtrend, the bigger picture, the uptrend, may be still in place.
I am hedging my position with puts this week
meh. I was confident in this thing, but i guess i was wrong. Didn't take that bad of a loss, but hey, nothings a sure thing right? I really do love the reversal day plays though. They are very reliable signals
i bought at 6. i set a stop at 5, and i guess i got stopped out. lol
lol i just got stopped out. bye bye!
I just set a stop at 0.0005. sorry guys, but if this thing falls below 0.0006, im out.
We closed green! Hold on to your seatbelts, folks! Next stop, Pennyland!
If this thing can close green, we might take off!
IMO, this market will continue its bull run through the friday closing bell.
wow. look at that 7 run. this is the first time that 7 has been there for more than half an hour. ooooooo this is gonna be fun!
Candlestick Alert: Upside Gap three methods!
I am seeing an upside gap three methods candlesticks in the XLF (Financial Sector). This is a bullish continuation candlestick pattern. So today is just a drawback. The rest of the week should be up up and awayyyyyyyyyyyyyyyyyyyyy
SO WHAT DO YOU SAY? TOGETHER, WE WILL TAKE OUT THOSE MMs AND PUSH THIS THING TO PENNYLAND!! FOR SPARTAAAAAAAA!!!!!!
Yes. Emotions only distract you from the facts! Read the charts. Understand a stocks position, or share structure. If you sell in fears of losing money, you'll wind up missing on the big runners. TRUST ME I KNOW WHAT ITS LIKE TO SELL OUT OF EMOTION AND END UP KICKING MYSELF FOR BIG PROFITS THAT I HAD RIGHT IN MY HANDS!
Yes. Emotions only distract you from the facts! Read the charts. Understand a stocks position, or share structure. If you sell in fears of losing money, you'll wind up missing on the big runners. TRUST ME I KNOW WHAT ITS LIKE TO SELL OUT OF EMOTION AND END UP KICKING MYSELF FOR BIG PROFITS THAT I HAD RIGHT IN MY HANDS!
i hope my patience pays off! HIT THE ASK PPL OR IM DUMPING 500000 shares AT BID! lol jk.
lol.agreed
up 33% on market open! Nice start for the day.
man i hope this becomes one of those quadruple digit returners.
lol i didnt swear.
EMLL GONNA BREAK THROUGH THE ROOF THIS WEEK! 0.01 here we come!
LOL look at the bid. 0.0002? Hell no! NO1 GONNA SELL AT THIS PRICE! BUY THE ASK PPL!!! LETS BLOW THESE MMS UP TO PENNYLAND!!!!