SPX – Quick update

SP cash chart is above, while we looked at long term chart a few days ago, interesting confluence of multiple price targets coupled with time resistance is visible on daily chart.

Like shown in previous posts on SP cash, 2074 – 2075 is where we have 161.8% and 127%  external retracements of two large swings in to 2009 low, but now we also have time resistance which falls on Nov 25-26.  First one is 61.8% of the large Low to Low, and second one is 161.8% in time of the swing down from Sep 19 to Oct 18.  These time windows usually act as “magnets” but at the same time change  in trend is more likely to occur during these periods.  Confirmation is needed, especially because larger cycles are still showing positive momentum until mid December, but at the same time on daily charts we have plenty of technical resistance both in price and time to see at least 40-50 point decline in SP’s.

Posted in Daily Updates | Leave a comment

E-T Chart – ‘Possible’ Topping Count

While there is less certainty in a final top count in the S&P500 Index until it is trading below the 10-day and 20-day simple moving averages, it is imperative to keep track of wave formations made in the event a top occurs, then one knows where to begin a count lower. As you know, I previously posted one ‘expanding diagonal’ count that did not work in the SP500, as of today. But, the DOW did not make a new high today, where the S&P did, so it seems best to be persistent and look for patterns that make sense. I have studied the S&P’s recent prices from many different angles to see if a diagonal was made – either expanding or contracting- but one does not appear, yet .. although one may appear if one more new high is made.

So … with the ‘waves present’ it IS possible to see a valid, large running triangle for wave 4, and a completed five-wave sequence up after the triangle. That chart is below (more text after the chart).

S&P 500 'Possible' Completion Count

It is especially important to note in this count that wave (e) of the running triangle is ‘not’ lower than wave (c), and further, that wave (e) ‘does’ cross back over wave 3 – which is at the 4.236 Fibonacci extension and has not been moved – thus validating the triangle.

Then, within wave 5, up, wave ii is a short ‘sideways’ that alternates well with a long sharp for wave iv. This places the gap solidly in the wave iii, and is followed by even a further five-wave sequence upward (shown in blue). Lending further credence to the count, wave ii ‘appears’ to back-test this triangle before the next wave heads higher. And, within the blue wave sequence, the gap is also in blue wave iii.

Of course, if you have followed my work, you know that a “running triangle” is still a more bullish formation – because of the higher (b) wave – than a regular (non-running) triangle formation. So, this entire upward wave since 1820 could still only be an overall ’1′ wave, or an ‘A’ wave in the upward direction. Because only time will tell .. please enjoy the chart in the interim.

Cheers! E-T.

Posted in Daily Updates | 3 Comments

Tuesday update

Click here for a free 14 day Trial
Premium content Continue reading

Posted in Daily Updates | Leave a comment

Monday update

Click here for a free 14 day Trial
Premium content Continue reading

Posted in Daily Updates | 1 Comment

SPX – Long term

S&P cash is approaching some hugely important resistance/target levels.  Of course even though it is not surprising that after breaking above 78.6% ret. level at 1381.50, the target at 1823.42 (127% ret. )  was activated and eventually reached and breached, the sheer size of the advance in points was difficult to except back in March of 2012 when it happened.  But…numbers don’t lie, and SP is very close to another very important resistance, which should provide quite a bit more problems for the Market.  On Friday SP’s closed right at the 100% expansion of wave marked “A”, which quite often is very strong resistance on it’s own, but stronger levels are sitting right above – 161.8% extension retracement of the swing in to 2009 low at 2138, and 161.8%  projection of “A” at 2213.50.  So at this point in time wave marked “C” did not make 161.8% projection of “A”, which is where typical target of wave “3″ would be, hence “ABC” labeling for now.

I suspect that 2138 level, give or take a little, will become extreme target for this advance from 2009 lows, and much more often than not Markets will stage a sizeable decline after reaching target of this significance.  If SP’s do make it to 2138 level – it will be by far the biggest technical obstacle since the rally began five and a half years ago.

Good trading all !!!

 

 

Posted in Daily Updates | 2 Comments

20141123 – Trendfinder II Weekly

Click here for a free 14 day Trial
Premium content Continue reading

Posted in TrendfinderII | 1 Comment

20141123 – Trendfinder II Daily

Click here for a free 14 day Trial
Premium content Continue reading

Posted in TrendfinderII | Leave a comment

E-T Chart : ‘Possible” Expanding Diagonal

While this count is not ‘proven’ yet, one way to count the current SP500 Index uptrend is as an Expanding Ending Diagonal. As you probably know, the expanding diagonal pattern, ‘must’ have five three-wave sequences – where wave (5) > (3) > (1), and Wave (4) > Wave (2), with Wave (4) overlapping Wave (1). All of these requirements are met in the chart below. In this case the pattern also includes a “throw-over” of the upper trend line, and prices trading back under the upper trend line. This type of pattern is also commonly referred to as the ‘megaphone’ (More text below chart).

Potential Expanding Diagonal

Looking for the “uncertainty” in this count, it is whether all of the legs can be counted as zigzags. I have proposed one manner by which it is possible to see the up-legs as zigzags. That proposal does away with the fourth wave triangle discussed earlier and reverts back to the simple flat for wave 4 (shown in blue).

Why propose this count? Because most likely a large Elliott Wave sequence that has gone “too far, too fast” will end with a diagonal sequence of some type. And the rise from 1820 has occurred without even one 38% pull-back after wave 2, making it a good candidate for a “too far, too fast” move. Adding to this is the length of wave 3 at 4.236 x Wave 1; quite a long move in itself.

Nothing is for certain, of course, but the potential diagonal seen here means, at the very least, one should not be surprised if the market were to reverse sharply from this location. Although weekly prices did end at a ‘new high’ as the media will report, they did not end at the high of Friday’s session – which is something new in and of, itself.

Further evidence that a count of this type ‘might’ apply is the ES futures tagging it’s daily Bollinger Band on Friday, and divergences with the advance – decline line.

This is the “five wave” count up from the bottom at 1820.

Hourly SP500 Index from 1820

The best alternate for this count remains the triangle discussed last week, and Friday’s action as iii of 5, where 5 would = 1.

Cheers and enjoy the charts! E-T.

Posted in Daily Updates | 3 Comments

Friday update

Click here for a free 14 day Trial
Premium content Continue reading

Posted in Daily Updates | Leave a comment

Thursday after the close

Click here for a free 14 day Trial
Premium content Continue reading

Posted in Daily Updates | Leave a comment

Thursday updates

Click here for a free 14 day Trial
Premium content Continue reading

Posted in Daily Updates | Leave a comment

Russell 2000

While all major Indexes came back and made new highs since October lows,  Russell 2000 could only rally to 88.6% retracement and is still about 5% below all time highs the Index set in July of this year.   However, as we look at the last five trading days, it is easy to see a perfect zig-zag  where leg “C” = “A”.  Much more often than not these zig-zags are corrective patterns.   As we discussed a few times in the chat room over the last few weeks,  November 17-19 was expected to usher in a period of higher volatility in the Markets, with likelihood of at least intermediate top being set, but so far stocks managed to move sideways without breaking important support levels.  If there is one thing that Markets have consistently shown us is that if something is supposed to move down during certain time period and instead goes in to sideways correction – it is a prelude to strong trend continuation once window of anticipated weakness closes.

Now this post may be a bit premature, since there is still some time left in which stock can stage a serious decline, but bears are running out of time, with cycles changing positive toward the end of next Thanksgiving 2014 week, and cycles are expected to stay positive through at least mid December.  So even though we still have some time for a good sell off – it has to literary start immediately based on my work.  Daily chart of Russell 2000 is also in a good position to start next leg higher which should lead to new all time high.

 

 

Posted in Daily Updates | 2 Comments