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WTIC OIL E-wave
WTIC looks like it is near completion of a zigzag off the February 2016 lows. The zig is a run of the mill motive wave. The zag looks like an ending diagonal that started from the April 2016 lows. zag wave 5 is pretty much done. I'm anticipating a major turn lower.
http://stockcharts.com/h-sc/ui?s=%24WTIC&p=D&yr=0&mn=6&dy=0&id=p39698700160
BlissBull,
I sort of remember that from the Hurst Model. I, however, am using one of Hurst's other suggestions: spectral analysis using advanced mathematics. I'm reporting what I observe coming out of bandpass filters.
Bliss, 18 yr cycle
I detected the 18 yr cycle with my software. It is losing its strength quickly heading into its top over the next 100-200 trading days. Once the 18 yr cycle tops, two VERY large cycles (9 and 18 yr) will be synchronized toward the downside while another strong cycle (4.5 yr) will be crashing then bouncing for some great intermediate term trades.
Spectral Model Update for SPX
The following cycles analysis and forecast uses closing prices for the S&P 500 as of Friday, April 15th, 2016. The last forecast ( about 35 trading days ago) based on projecting the model was off in the near term as there was no prominent low for the combined 20 and 34 day cycles. The warning of the diminishing effect of the 20 and 34 day cycles, however, was spot on. The bottom chart shows how the strength of both the 20 and 34 day cycles were reduced over time.
The longer cycles of 3.4 and 7.4 years continue to head lower to the downside.
The combined effect of the 80 and 120 day cycles is slightly past its peak, which is the dominant feature of the top chart. There is still about a week to go before the strongest part of the down phase is felt.
The combined effect of the 20 and 34 day cycles is slightly past its bottom and will contribute to move in choppy sideways to slightly up action over the next 5 days.
The general market has about a week of consolidation left and will be heading lower faster and deeper than in January 2016.
The 100 day back-correlation of the forecast with the market is 0.95.
SPX futures waterfalling tonight.
This may be the end of the rally out of the February lows. The 80/100 day cycle is topping. With the 7.3 yr, 3.3 yr, and 80/120 day cycles now heading down, the February lows should be blown away in 2016Q2.
Note how European markets have not kept pace with US markets out of the February lows.
USD correction nearly over. Ready to Rocket
Since March 2015, the US Dollar has been moving sideways. It looks like a nearly completed flat. wave c of the flat looks like an ending diagonal. Get ready for some excitement in the foreign exchange markets this spring.
http://stockcharts.com/h-sc/ui?s=%24USD&p=D&yr=2&mn=0&dy=0&id=p88373101996
Ide's of March, 2nd Warning
The 80/120 day combined cycle ate the 20/34 day cycle, or the 20/34 day cycle inverted. The 80/120 day cycle is near the end of its strongest move, so this cycle will not come into play the next 10 days. In the inverted 20/34 day cycle scenario, this cycle has entered a window where its top is taking place. So expect selling for the next 8-10 days after the FED makes a public statement.
LMT in an Ending Diagonal since January 2016 lows.
In wave 5 b of ending diagonal. There is a good chance the ED will truncate with respect to the November 2015 high of $224.55. LMT tops this week with FED open mouth committee meeting Tuesday or Wednesday.
http://stockcharts.com/h-sc/ui?s=LMT&p=D&yr=0&mn=6&dy=0&id=p93304450987
For the SPX 500, the rising combined 80/120 day cycle swallowed the falling combined 20/34 day cycle.
SPX500 Ewave off the February low is looking like a double zigzag that is near the end of wave c.
SPX Spectral Model Update for February 26th
The following cycles analysis and forecast uses closing prices for the S&P 500 as of Friday, February 26, 2016. The general market has found support and is under consolidation before it continues its crash.
The longer cycles of 3.4 and 7.4 years continue to gain momentum to the downside.
The combined effect of the 80 and 120 day cycles is entering its strongest part of its rally that should peak in 5-6 weeks.
The combined 20 and 34 day cycles formed a peak on Friday and will contribute to a pull-back lasting 8-10 trading days.
The 100 day back-correlation of the forecast with the market is an astonishing 0.98. This should yield a highly accurate forecast. While the forecast indicates the market will fall below the late January and February's lows, the forecast estimated a less than perfect 34 day component with an ideal sinusoid. The actual 34 day cycle amplitude may fall short of the forecast. The 20 day forecast has been in an expanding envelope for 3 cycles, which is likely to start contracting. With both the 20 and 34 day cycles facing potential shorter amplitudes than estimated by curve fitting, the actual 30 day projection may result in an inverted head and shoulders with an up-sloping neckline and shoulders. The amplitudes are debatable; however, the timing on the low in 8-10 days should be on target.
The e-wave equivalent of the next 8-10 days is wave 2-b of some larger degree down.
Frank and Jglider
SPX is in the zone where my model is calling for a tradable top. Getting out at Monday's close / Tuesday's opening wasn't a bad idea. My model is looking for 8-10 days to the downside from here. It may be possible a pop at Friday's opening takes place. The top may even take place overnight since the top is that close.
I'm updating my model this weekend. It's been 2 weeks since my last update, and the amplitudes of the shorter term cycles can change within that timeframe.
Get Off The Elevator!
The next day or two are ripe for a turn lower that should retest the Feb 11 lows. That's what the model is calling for. An E-wave zigzag off the February 11 lows looks about complete. The SPX is about to hit a Fibonacci 50% retracement. Multiple TA approaches are giving the same warnings, so confidence of a turn lower is high.
Chuck, Wave 4 Flat...
Yes, it's a count that hasn't been eliminated. wave 4 flat still fits within the spectral model. The chart I posted last weekend shows the next little dip has the potential to find support at the low last week, so it will not invalidate and wave counts. When I update the forecast next weekend, I'll have a better idea how far down the next dip goes.
Chuck, Little Pullback
I have to agree with you. The markets moved too far, too fast. My model says another 5+ days until this bounce (wave a) has a pullback of the same degree, so a pullback of a day or so starting now would make a nice little pause that connect the zig to the zag in this counter trend rally wave a.
SP 500 4-6 week forecast
The following cycles analysis and forecast uses closing prices for the S&P 500 as of Friday, February 12, 2016.
The general theme of a market crash is still very much in play. The longer cycles of 3.4 and 7.4 years continue to gain momentum to the downside.
Since my last update, I have incorporated 4 more cycles in the model: ~20 days, ~34 days, ~80 days, and ~120 days. These cycles are largely responsible for the daily, weekly and monthly swings in the market about the long term downtrend trajectory.
At this time the 120 day cycle is still heading down while the 80 day cycle is heading up. The combined effect is forming a strong trading bottom for a counter trend rally that should last 4-6 weeks. The stronger 20 day cycle is forming a bottom, while the weaker 34 day cycle is just starting its descent. The shorter cycles are going to combine for a 5-10 day rally.
Trying to sort out what 6 cycles are doing can be simplified by projecting individual cycles, and then combining their projections. This is visibly demonstrated with the red line in the top chart. The projection fits past data fairly well, although the projection would be better aligned wit the model if the projection were shifted to the right by ~4 days.
NDX gets a new e-wave count
The NDX is no longer in a triangle since last Tuesday's high. The next best count is wave 4 off the January 20 low, and wave 5 heading into a low this week.
It is also possible INDU, SPX, and NYA are also in the same count as NDX. If so, they are showing a potential ending diagonal. This fits well with expected action coming out of this 80-120 day combined cycle low.
Beware the Ides of March!!!
My bandpass filters indicate the combined 80/120 day cycles are now heading up for the next couple of weeks. The timing of its expected top coincides perfect with the FED meeting in mid March. The amplitude up is expected to be less than that heading into the January low. The shorter cycles are going to dance around this stronger trend all the while trying to synchronize their peaks.
The 80/120 combined cycles and 3.4 yr cycle will be at their strongest downside strength in early April ( wave 3 of Wave 3 down). The 7.3 yr cycle will be gaining momentum. Expect the markets to enter full crash mode after the FED makes its statement in March.
Still Consolidating
The question is what e-wave pattern will emerge to chew up 2-4 more weeks until the 80/120 week cycles form a combined top.
The Dow Industrials, SPX, NDX and NYA have formed a zigzag off the January lows. Now in wave b down, I prefer triangle to zigzag since a triangle would chew up the most time.
Jglider - Pivots
Does a cluster of pivots support the idea of wave b count from the January '16 lows?
SPX zig-zag looks complete.(wave a)
The rest of the week should be choppy to the downside. (wave b)
My model indicates the combined 80 and 120 cycles bounce will last through at least the middle of February.
$TSX is influenced by oil and mining companies. And oil bounced 30% higher very quickly.
Short term triangle in E-mini SP500
wave e should complete today then a couple of days of rallying to complete the zag of zig-zag.
Only a dip.
Still more upside to this countertrend rally.
SP500 target 1940-1950
Ending Diagonal fizzled, but...
The middle day snap-back was sharp enough to take some pressure off the downside. I do see a small wave 4-5 to be played out in AAPL, so the rest of the market has to be getting oversold.
One thing is for certain. The amplitudes of short period cycles (even intra-day) has really grown. 2-3% swings in 48 hours is very strong.
US market "consolidation" is looking very weak.
A bounce should have happened by now.
Things may be in full crash mode.
SilentOne, I saw the section of the video at the link you posted. I ran my software and was able to detect a prominent 14-15 year cycle as David demonstrated. The phasing matches the 1994 and 2009 lows closely.
The present top in the market due to the 3.4, 7.3 and ~14 year cycles implies the 3.4 and 7.3 year cycle lows straddle the 14 year cycle low. This projects a market bottom in ~4 years, when the 3.4 year cycle bottoms, the 14 year cycle is near the end of its downward move, and the 7.3 year cycle is mid-way up.
I need to try to detect a ~42 cycle using Dow Industrial data going back 80 years, which I suspect started from the late 1970's / early 1980's. Wouldn't it be something if the next larger cycle from the ~14 year were also topping now as well? If so. it's right translated, which means after this nasty crash it would be time to go all in and buy/hold for 18 years.
Near term bottom due.
I updated my model and the SPX trend projections.
The 80 and 120 day cycles in the model I'm looking at are due to bottom in 12 trading days. The market typically bottoms before then, It looks like another wave 4-5 combination needs to complete before a 2 week countertrend rally begins.
The second half of February and all of March should create gaps in the chart.
SP500 E-waves Getting Difficult
The SPX has been in a choppy move to the downside the past 2-3 days. Normally this would indicate an ending diagonal to be followed by a sharp reversal. The technical significance today was the price breaking above the upper trendline of the two-week downtrend. Caution is warranted as a corrective rally may be under way.
Wave 3 is Extending
Today was another wave 1-2 of smaller degree. wave 2 is also a flat. With several wave 1-2 combinations and wave 2's being flats, the potential for a fall that halts trading increases dramatically.
That was quick!
The e-mini SP500 fell below what I count wave 3 of wave c (ending diagonal) of wave 2 flat. This confirms the flat has completed. Expect 10% minimum sell off until wave 4 starts. Since the market is in 3 of 3 count, with the possibility of more 3 of 3 waves or smaller degrees in the extension, wave 4 could be even further to the downside.
E-mini SP500 intraday e-waves
From Monday's low it looks like a flat is forming, with wave c being an ending diagonal. This is the same formation in the Chinese SSEC. More downside the rest of this week.
Choppy-Toppy
Now that the eggnog has had some time to dissipate, I vaguely remember the light bulb going on in the cranium at yesterday's close.
Trying to figure out e-waves in a choppy market is tough. The market over the last 2 months certainly qualifies as choppy. My preferred wave count for the SPX and NDX since the early November high is Wave 1 down followed by Wave 2 flat, with wave c of Wave 2 being an ending diagonal. wave 5 of the flat should take place and complete next week.
Wait for a breach of 4500 in the NDX and 2005 in the SPX for confirmation of a completed flat. Then we'll know Wave 3 is definitely under way.
Charts for SPX cycles
Filter 3 is the 120 day cycle.
Filter 4 is the 80 day cycle.
As shown, the 80 and 120 day cycles have magnitudes that are similar to that of the 3 year cycle. With 3 of these strong cycles heading down, and the 120 day cycle topping, the downside forces are strong and getting stronger.
The market correlation with moving average, filters 1 and 2 is 0.918. The market correlation with moving average, filters 1 to 4 is 0.944. These numbers are extremely strong and validate the model. The ability to observe sinusoidal cycles make the model useful.
The 80 and 120 day cycles can be used for trading trends lasting a couple of weeks. The 3 and 7 year cycles can be used for buy/hold rebalancing retirement portfolios.
Chuck, my backtesting efforts have been at the macro level. There have been 24 market turns (up or down) in the SPX for data going back to the year 1950 that were followed by moves greater than 20%. The criteria is kind of arbitrary, but I think 20% qualifies as a bear market. So being able to predict when a loss is approaching is more important than missing a gain.
I'm scanning the market for clear signals, so I have not developed a sense for the tool's limitations. For instance, in trying to find the top or bottom of a cycle, smaller cycles with disproportional amplitudes can get detected even though it's past the cut-off frequency of the bandpass filter. This is happening right now. The 80 and 120 day cycles have a combined amplitude of more than 150 SP500 points that shows up as 10 points of noise in the filters for the 3 and 7 year cycles. Similarly, larger cycles get detected in filters for the 80 and 120 cycles. This causes an offset so that techniques for detecting a zero crossing won't work. These imperfections complicate automated backtesting.
Based on the model's long term forecast and unforeseen events of the 2008 crash, I am 100% cash. When banking and finance stocks were under pressure, bans on shorting went into effect. This bear market will be no different in terms of sudden rule changes. It's difficult to formulate a strategy when the rule change. One might be able to justify going short until markets have dropped 20%, trying to get out before an unknown threshold on shorting bans takes place. If those who short have their portfolios blown out of the water by sudden rule changes, then the bottom will be MUCH lower due to less available money. Then I can have a higher percent of ownership of companies in the long run.
About the only thing that would help in my efforts at this time would be a link to 1 minute or 5 minute intraday tick prices. then I could scan for 1 to 10 day cycles.
Updates to my spectral model using INDU and SPX data.
The longer term has not changed. The combined 3 and 7 year cycles continue to roll over. The whipsaw action of the past 6 months has caused only a slight pause of the downtrend, which is resuming. 2016 is looking like the year of the crash as these cycles accelerate to the downside.
I've been working on techniques to improve the model for shorter cycles. The challenge in finding short term cycles is fewer data points means less of the signal is available for analysis. The 80 and 120 day cycles are starting out in their sequence of activity, and they look remarkably clear. A sequence of activity lasts 3 to 5 cycles. Their combined effect is rolling over, and a move to the downside should end below the summer lows in the INDU and SPX.
XBD - broker dealers
The Ewaves for XBD are very clear.
Wave 1 drop ~20% from the July 2015 highs to the October lows.
Wave 2 Zigzag corrective move.
Wave 3 - wave 1 complete
Wave 3 - wave 2 zigzag or double zigzag. There looks to be a symmetrical triangle on the intraday chart all of Tuesday November 17th into November 18th open.
XBD is set to drop MUCH more than the 20% Wave 1 dropped. The sell off may be so bad regulators ban shorting stocks of financial stocks.
Drop from Wednesday' pre-market top looks complete. The next day or so should be sideways to slightly up. People are going to attribute any positive outcome on Monday to market manipulation, but the E-wave patterns are very clear on this one.
Amazing AMZN, Gobbling GOOGL, Shameless FB
AMZN was in Wave 4 triangle correction all of 2014, and Wave 5 in 2015. AMZN is so close to topping out and heading back to the $300-$350 range before finding intermediate support. Ultimately the bear market will drag AMZN down to $30 where larger WAVE 4 ended.
GOOGL started its Wave 1 rally in 2009. The Wave 4 consolidation started in late February 2014. Wave 5 started in April 2015. little wave 5 stared in late September 2015, and is nearly complete. A major bear market should start any day and eventually find support in the $500-$550 area, where Wave 4 ended. The bear market should drag GOOGL down to the $150-$200 area before it is over. This is where larger degree WAVE 4 ended.
FB is more difficult to count because it does not have as many years and the advance from October 2014 to April 2015 was choppy. Volume was very strong in the rally from July 2013 to March 2014, which was the strongest rally in percentages. volume is about half in the rally the past 2-3 months. The rally the past 2-3 months looks like a completed motive wave, and synchronized to move lower with AMZN and GOOGL. The bear market should send FB below its IPO price in the teen$. Remember, FB is a positive social mood phenomena. When people are happy, they want to include people and share stories. FB reflects that. When mood turns negative, how will people reflect their mood through FB? In the past year one of the DJ's on the radio station I listen to has been "unfriending" people on FB. That's a good indicator FB is at a top.
Subprime Auto Technical Breakdown
After an initial 33% sell off in July and August this year, CACC recovered and rode above the 200 day moving average support. The past several days CACC has again plunged below the 50 and 200 day moving averages by 10%. This time the selling is accompanied by increasing volume.
http://stockcharts.com/h-sc/ui?s=CACC&p=D&yr=0&mn=6&dy=0&id=p65632625107