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Larger Degree E-wave Count Dominates
The SPX and INDU are showing a flat correction off the August 22 lows. The NDX is showing a zigzag off early August lows. Both corrections are nearly done. Markets should start rolling over tomorrow or Monday.
GOLD Another Trader's E-wave Chart
I have the triangle on wave e. Banister has it in wave c with a couple more weeks of consolidation before the explosive move.
http://www.safehaven.com/article/22528/gold-heading-to-2350-per-ounce-after-4th-wave-consolidation
NDX Gives E-wave Clues
From the August 2011 lows the NDX is making a reasonable zigzag with a huge running triangle linking zig to zag. The zag (wave c) started Monday. wave c may or may not be finished. Confirmation of a resumption of the larger downtrend will be when the NDX drops below 2140.
http://stockcharts.com/h-sc/ui?s=$NDX&p=D&yr=0&mn=6&dy=0&id=p55352776190
GOLD About to Explode
Since the August 2011 high in gold, a wave 4 triangle has evolved. In commodities, wave 5's often extend in parabolic moves. This triangle helps identify such an opportunity. Target $2000+
http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&yr=0&mn=6&dy=0&id=p39906288813
http://charts.insidestocks.com/chart.asp?sym=gld&data=Z60&date=051406&den=HIGH&divd=Y&evnt=ADV&grid=Y&jav=ADV&size=D&sky=Y&sly=N&vol=Y&late=Y&ch1=011&arga=&argb=&argc=&ov1=&argd=&arge=&argf=&ch2=&argg=&argh=&argi=&ov2=&argj=&argk=&argl=&code=BSTKIC&org=stk
REDEMPTION!!! Target Hit.
The SPX is close to a fibonacci 38% retracement.
The time spent correcting is only 12.5%
More consolidation is needed. Look for a slightly down to choppy day tomorrow.
Bear Market Rally e-wave count off the August lows is just completed wave b of a double zigzag. Going higher over the next 2 weeks. (This is a possible wave count where Snoot and I agree )
Bear Market Selloff e-wave starting from late August highs. This morning's low completed a second degree of wave 1 of a much larger degree extending wave 3. The bounce may be over. Watch out for Uh-Oh Tuesday. ( This is another possible count.)
At this point I still think these different counts are equally valid; however, due to the predicted large moves in opposite directions, more waves need to unfold to reduce risk of a losing trade.
Snoot- Ok, that is QE
It is a backdoor way of doing it. It may not work long term as rates are at historic lows, and that a sudden e-wave may force a QE3 deleverage.
SPX Bottoming
Ready to move to the 1155-1160 area.
If this bottom doesn't hold then lookout below...
SPX Futures Down
The 2 day sell off is apparently in the late stages e-wave 4-5. The upside target of 1170 has been lowered to 1160, where the first of a congregation of wave 4's has topped.
Wait for the SPX to drop 20 points Monday morning before considering catching a 20-30 point bounce.
CapGain- USD, QE3 and Bernanke
E-waves is about patterns and their predictive odds of chart trends regardless of the events or news going on. There will be small blips here and there; however, the event of longer term trends will not cease to happen. Maybe QE1 slowed down the 2008 market crash. Maybe QE2 boosted the 2009-2011 bear market rally. What neither could do was prevent the waves from unfolding.
The likelihood of QE3 is more about having political support, which the FED does not. This support has its own E-waves, though it is more difficult to count because no real chart exists. The clearest e-wave linking the FED to investor sintiment is the short term yield chart. It clearly shows the FED FOLLOWS INTEREST RATES THE MARKET SETS, not leads it. Based on treasury yields, I would agree investors do not expect QE3, or are willing to take a little loss due to inflation as protection of capital.
USD - Up, Up, and AWAY
http://www.financialsense.com/sites/default/files/users/u163/images/2011/0909/usd.png
A long term bottom was formed in 2008, and has been corrective since.
WAVE A started from lows in 2008, ended highs of 2009.
WAVE B is either a flat or zigzag. It ended last week.
WAVE C has just started. A very realistic upside target is above 90.
BUY THE CLOSE, MONDAY OPEN POP
Wave structure is near complete. Even though I think Monday will be a small corrective move, I equally agree with Snoot's e-wave count of a larger corrective rally.
Either case favors a rally early next week.
Definitely a motive selloff.
looking for one more test of SPX 1150 before a nice 10 20 pt corrective rally.
FTSE Zigzag Done
The intraday chart shows a finished zigzag. The past couple of hours is looking like a waterfall selloff, a sign of strong trend.
The corrective rally in the DAX is less clear to count; however, a waterfall selloff is also in the works.
World markets go down or sideways for today.
http://finance.yahoo.com/q/bc?t=5d&l=on&z=l&q=l&p=&a=&c=&s=%5Eftse
Opening Pop Completes Zizgag
Look for the US market opening pop to top and turn lower. Yesterday and today has provided enough time and price corrective rally to last week's selloff. The e-wave structure looks complete as well.
Euro and Dollar
Today confirms the end of the Euro rally, Dollar bear market. Fasten your wallet because the world now wants your dollars. US import prices should drop quickly now.
Snoot Futures and Cash
I'm actually using both futures and cash markets. And no, this isn't just to avoid a debate of one vs the other. I don't have enough data to discuss intelligently.
Your SPX Target 1140 was hit
The futures were down near 1137 at one point today. This evening they are around 1140.
Euro Starts Multi-month Wave 3
The long term e-wave count has December 2009 as the all-time high in the Euro. Since then multi-month Wave 1 down ended in June 2010. Wave 2 corrective move ended last week. The debate is open for alt count WAVE 5 ending last week, truncating at 2 degrees, AND ending diagonal at 2 degrees of trend. Both arguments agree the Euro is going to drop substantially over the next year.
http://stockcharts.com/h-sc/ui?s=$XEU&p=D&yr=3&mn=0&dy=0&id=p13907114122
The wave count for the Euro Index shows that from early May 2011 highs to early August 2011 lows a triangle formed. A triangle is a high confidence pattern that only one more wave follows it in the larger degree. The rest of August 2011 was an ending diagonal. Initial confirmation of the top will be when the Euro falls below the 140.90 level. I'm counting the last day or so as the start of a significant bear market in the Euro.
http://stockcharts.com/h-sc/ui?s=$XEU&p=D&yr=0&mn=6&dy=0&id=p76434643972
In my readings this weekend, I came across the answer to the USD- Treasury yield paradox: How can the yield make a huge drop, but the dollar index remain flat as European countries and companies make huge deposits in US banks? The Answer - as I suspected, SWAPS. Using swaps prevents an instant unravelling of the Yen carry trade. Guess What? It's gonna unravel!
FTSE and DAX
Today the FTSE and DAX completed a motive wave down, lasting 3 days. It looks like wave 3 of the motive wave extended, so there should be a corrective bounce tomorrow. Maybe a pop-n-drop.
The futures for the US markets are way down; however, they look to have completed a motive wave down similar to the one in Europe.
INDU SPX NDX Support at 20 DMA
RUT TRAN and NDX just below 20 DMA.
The VIX ticked up a little, so there is no oversold condition. The last couple weeks it formed a double zigzag.
For all US markets, the upper bollinger band repelled prices, while both bands are pinching and set to open next week to accomodate a large move.
FUTURES WAY DOWN
The triangle count is no more. The flat is still in play. I prefer the count where a truncated wave 5 existed for 15 minutes yesterday, and a new multiday selloff has begun.
Big Move Tomorrow.
The triangle count is still valid in all US markets. At a quick glance, the 2 day chart looks like a flat. This is bullish for tomorrow and wave 5 target between 1230 and 1235. Pop and drop
What I had as a preferred count earlier was a triangle, but that endend around 12:15 PM. wave 5 truncated. This is the bearish case and calls for a huge selloff tomorrow.
It's a Triangle!
Intraday Flat or Triangle in Progress
The selloff from Wednesday's highs is corrective. Waves a and b are zigzags. Either a flat or triangle is forming, then wave 5 pop to end the 2 week rally. The prices for US markets are near the upper daily Bollinger band. The bands are starting to widen, an expetation prices will get more volatile. The SPX 5 minute chart shows an RSI bearish divergence.
Investor's Intelligence Surprise.
The reading came in 40.9% bullish and 36.6% bearish. The surprise was no change in bullishness and an increase in bearishness despite the market rally the last 5 days. The VIX shows the market has decreasing fears for the past week.
NDX and TRAN Clear E-wave Counts
For the NDX
http://stockcharts.com/h-sc/ui?s=$NDX&p=D&yr=0&mn=6&dy=0&id=p05339026672
Middle July 2011 high to earrly August low was motive. Wave 1 or A.
August lows to present is a flat 2 or B in wave 3 of c.
For the TRAN
http://stockcharts.com/h-sc/ui?s=$TRAN&p=D&yr=0&mn=6&dy=0&id=p78945368162
Early July 2011 high to middle August low was motive. Wave 1 or A.
August lows to present is a zigzag wave c, which is nearly completed.
What this implies for the rest of the markets with less clear wave counts is they will all head lower at any time over the next 3 days. If the July -August selloff is Wave 1 of a larger motive wave, then Wave 3 selloff will drop more than 20% since flats occur before or after the longest wave of the larger degree.
Opening until 1 PM was a wave 4 flat.
The rest of the day was that elusive wave 5. Now for some of tomorrows headlines to justify a selloff!
1.) "European banks having more problems". It's not more problems. It's the old ones that never went away while the media dre our attention to something else.
2.) "Greek 1 year bonds yielding over 60%!!!" Nobody can run a country on credit card rates, but TWICE THE RATES OF CREDIT CARDS?!
3.) "Gold is falling because stocks are falling" The e-wave count for gold is a complete double zigzag. Short Midas.
4.) "This is ONLY profit taking, and is necessary to shake out weak positions". If ONLY the media cared enough to learn about what they were reporting, the would understand the difference between profit taking and flight to safety.
5.) "Euro is rising on investor confidence!" Little does the media realize a multi-week triangle in the US dollar with one exhaustion selloff to the $0.70 area before a huge rally ensues.
Top Coming In
The SPX intraday chart shows a halfway complete motive way rally from the day's lows. This is promising to be wave 5 of the larger degree motive wave from Friday's low.
E-Wave is Larger Degree Correction
Today continues the corrective rally off the early August lows in US markets, not a corrective rally off the middle August lows. All markets are in the upper bollinger channel and rising toward a falling band. This tends to act as a target and resistance in a corrective rally. It is difficult to say with certainty that the intraday charts show a nearly completed motive rally wave off fridays lows since the gap up this morning may still be in late stages of wave 3 and not starting wave 5.
Investment Puzzle or Paradox
The US dollar is despised by many, and the media seams to think it will collapse any day now. Yet with all this negativity Europe's wealthy are transferring their wealth to US banks. How can the US dollar remain mired despite such transfers large enough to send short term Treasury rates negative? And why would anyone accept a negative interest rate?
After some thought the only way the massive transfer to US banks NOT impact the US dollar is if the Europeans were transfering dollars that were never converted from Euro's. The charts are showing a dollar bottom being formed
The negative interest rate means the investor is willing to pay for protection on the remaining capital. Why not just hold dollars? The financial system is a credit based, fractional reserve system. There are not enough physical dollars in existence to be exchanged. There may be enough realestate to purchase; however, it's not liquid. Buying Treasuries allows for low risk and lquidity by rolling over contracts involving virtual dollars. Other forms of debt, such as savings accounts in European banks, won't preserve capital.
Today Was Corrective
for Gold, INDU, SPX, NDX, TRAN
Gold gapped down more than 4% to complete the motive wave selloff from Tuesday's all-time high, and then ran for a positive gain for the day. It looks like a double zigzag consolidation rally is in play.
The SPX futures show a double zigzag selloff over the last 24 hours. They bottomed around today's close and have been making a motive rally this evening. Whether the rally the last couple of days retraces last week's selloff, or completes the consolidation of selloff into the the August lows; both wave structures indicate a turn MUCH LOWER is just around the corner.
It's gonna get wild tomorrow with the FED Yackety-yak. Buy straddle options at the opening. One direction will prevail in a dramatic way
SPX and INDU hit middle of Bollinger Bands
NDX and TRAN came close.
E-Waves favor selling, but several counts are valid.
TRAN has a bullish RSI divergence, so there may be a couple more weeks of consolidation for all markets.
Pop and Drop
The SPX futures are showing an ending diagonal while the premarket is pointing 7 pts higher
Gold - More Drop Ahead
The e-waves for gold show wave 3 of 3 of a multiday motive wave. Waves 4-5 at a couple degrees are due the rest of this week. At a minimum, there should be a consolidation rally nrxt week before another motive selloff.
D'Oh! Alt Count?
I'm starting to get the feeling the consolidation off the lows two weeks ago is still under way. Today's SPX rally retraced 50% of last week's sell off. The SPX is quickly approaching the middle of the bollinger band channel, a common line of support/resistance. This would time nicely with "sell the news" Bernenke announcements from Jackson Hole later this week.
That's more like it.
Look out below!
NDX completed ZigZag- Time to Sell
SPX and INDU did too
SPX Went UP 20 Pts Overnight
My consolidation targets were hit overnight. We'll see how the SPX open market behaves today. Futures are up 8 ish pts right now, so there could still be a some upside the rest of the day.
SPX 20 pts UP tomorrow.
The futures are making a double zigzag pattern, where the SPX open market is making a zigzag. Both, however, have wave b triangles.
Waiting for an Intraday Triangle.
The drop after today's pop looks like a triangle on INDU SPX and NDX. This is wave b of a zigzag. SPX range for the end of the zigzag is 1145-1150.
Sharp rally to close; however if the rally wilts, the market goes lower. Don't hold overnight since a wave 3 will be starting. This is where gaps down occur.