Friday, December 30, 2011

11/30/11 - EOD Update

The market ended the year with a dud. It also closed below the 200 day SMA and MACD is in a sell signal from 3-60 mins.

SPX - 30 Min Primary
There is still some hope for the primary count though but I remain cautious due to the bearish MACD configuration. Lets see if the lower TL holds early next week.

I currently have wave 2 grey for 5 blue in play. It's very possible it ended right on the lower TL. If not, the bulls need to defend 1248.64 and more importantly 1242.82 or else the rally off 12/19 is over.

If 1242.82 breaks, we must focus on Primary B, which at the moment is holding its own against the primary.

SPX - 15 Min Primary B
Here I have either wave y grey of b blue of (2) trying to push towards 1267 to form a flat as the main count for this option. However, if the wave a/(2)? low is taken out, chances are greater the market is working on its third leg down to complete (2) near 1243 / 1230.

Once again, the current MACD configuration supports this count, however, until price invalidates the primary, we'll focus on that and keep an eye on this one.
SPX - Triangle Alternate
There are different variations of a potential triangle playing out. I have 3-4 other options but will not bombard you with them until there is more evidence that they are playing out.

I do believe this is the best version at the moment. This count is looking for wave [e] down to complete wave 2/B/X. This would be consistent with the direction of primary B as well.

But of course until the yellow contracting trendlines are broken, we won't know for sure.
The VIX daily looks like it may be setting up for a move higher to challenge its 20 day SMA at 24.93 early next week. Again, something else to add that favors the Primary B count as well as the triangle alternate.

That's it for me today. I want to thank all my readers for visiting over the past year.

I hope it has been a good year for you all as it has been for me and I don't just mean in the financial markets. Because lets face it, there is more to life then just making $$.

I wish you all a Happy, healthy and prosperous New Year to come!

11/30/11 - Pre Market


Yesterday pre-market I showed the potential for a flat to form, however, the move off wave a looks like five waves up.

So either a triple nested 1-2 up is underway or ES will find resistance right about here for the flat. Notice the 30 min MACD -ve divergence.

Thursday, December 29, 2011

12/29/11 - EOD Update

The market behaved as expected today, especially based on the primary B scenario from yesterday's EOD Update. Not only did the market challenge the 200 day SMA again, it close above it once more.

How many more times are the bulls going to challenge this before staying above it for more than a few days? The 60 min MACD is on the verge of crossing up so that may potentially favor the bullish count.

SPX - 30 Min - Primary
Though I had my doubts with this count yesterday it is still very valid. The market bounced off the lower channel and did so in a semi-impulsive fashion.

I have this as working towards the completion of wave 5 blue or potentially only wave 1 of 5 blue. Once again 1267 may present some challenges.

SPX - 15 Min - Primary B
The bulls managed to retrace this count nearly 78%. This is starting to look like a potential flat in the making. This is very similar to the formation I was suspecting ES may also be forming.

If the bears are here to push this down further, they need to show up tomorrow.
SPX - 15 Min - Primary C
I presented this chart a while back when I introduced the count as a 1/A up and 2/B pullback. Since then, it is possible to consider another nested 1-2 (1)-(2) up. I know this is very bullish but so far that is something we must consider or at least be aware of.

The triangle pattern overall is still something to consider and if that is something playing out, these structures obviously would count better as three wave structures.
50 and 200 day SMA
Still knocking on the 200 day.

SPX - 60 Min Inv H/S
 1267 will be key to this pattern break out. MACD ready to signal a buy.

McClellan Oscillator
I've been watching the McClellan histos and noticed that when the daily bars drop or rise from the previous bar, they tend to portend a move in that direction the following day.

The 12/23 and 12/27 histos certainly indicated the drop for the 28th. Granted this also had negative divergence.

Let's see if the histos for the 28 and 29th is indicating that the market will push higher tomorrow.

12/29/11 - Pre Market

If ES does not break out of what appears to be a triangle, I can see a third leg down to approximate 1229. This would make wave c=a and is the 50% retracement of the 12/19 rally.

Wednesday, December 28, 2011

12/28/11 - EOD Update

As suspected yesterday a top was found at yesterday's high. The 60 min MACD -ve divergence I also pointed out, which favored Primary B was confirmed today as well.

The question now is which top are we dealing with?

The primary marked yesterday's high as the top of wave 3 and the Primary B count marked it as a complete five waves up. We can eliminate primary C and just focus on the Primary and Primary B.

SPX - 30 Min - Primary
Wave 4 technically has retraced wave 3 a respectable amount and is now within the territory of the previous wave 4.

However, I do have issues with steepness of this retrace. This count has certainly become suspect. A retrace below 1242 and this count will be ruled out completely.

I would say Primary B has certainly gained a lot of ground in terms probability.

SPX - 15 Min - Primary B
This count has certainly gained some ground and looks as though wave a of (2) may have completed or is very close to completing. I suspect if this is the correct count, a re-test of teh 200 day SMA would be in store with the wave b bounce.

So tomorrow at some point, we should see the market either bounce in a wave 5 up or at minimum test the 200 day SMA via a wave b of (2) bounce.

12/28/11 - Pre Market


Tuesday, December 27, 2011

12/27/11 - EOD Update

Last week, the primary count was looking for a completion of wave 3 near 1270. Today the market pushed up to 1269.37. That's pretty darn close enough.

SPX - 30 Min - Primary

Per the primary, wave 4 blue began today. 1259 looks like it may be a very good target for the following reasons:

1. A backtest of the 200 day SMA
2. The intersection of several trendlines that may act as support at this level (see chart above).
3. The 23.6% Fibonacci retracement is at 1259 as well.

Wave 4 blue can retrace further so long as 1242.81 holds, since this is the top of wave 1 on my chart above.

SPX - 15 Min - Primary B
The next best count is that five waves up completed for wave 1 of  (c)/(3) grey. Per this count, a deeper retracement more along the lines of  38% (1243) -62% (1228) would be expected.

The 60 min MACD -ve divergence may be hinting at this option. Let's see if the bulls hold the ascending channel tomorrow for a clue.
SPX - 15 Min - Primary C
I like this option as much as the primary B option but will give B the edge due to the -ve MACD divergence. Again, the channel will be key here. 1260 appears to be a key level for this one.

Earlier I showed this chart and the significance of 1267. Notice the zero-line cross on the weekly MACD?

Friday, December 23, 2011

12/23/11 - EOD Update [12/24/11 Update]

[12/24/11 Update]

Just a quick chart and the significance of 1267. Notice that wave 4 may/should find support at the purple or yellow descending trendline right in the 1245-1250 zone. The 60 min MACD may be supporting the end of 3 here shortly.

Any retrace deeper than that and the primary B count below should be considered.

Alrighty. Time to enjoy the family. Merry Christmas and Happy Holidays to all!

EOD Update

It looks like Santa is coming to town after all. With a close over the 200 day SMA and a daily MACD buy signal confirmed today, the bulls just may make a charge for 1292 before the new year.

The bearish triangle I have been posting has been severely damaged with the run up the last few days. A different version of the triangle is presented below but I don't give it too much consideration at the moment.

It should be noted that the descending trendline connecting the 7/7/11 and 10/27/11 tops has also been breached today.

We shall see if the bulls can continue to push this higher next week.

SPX - 30 Min Primary
The primary count born from the alternate options I presented last night and through out today. I'm looking for the completion of wave 3 blue very shortly and possibly towards 1270.

SPX - 15 Min Primary

The 15 min squiggle for the primary.

SPX - Daily Inverted Head and Shoulder
The neckline break for the inverted head and shoulders.

SPX - 15 Min Primary-B
Going into next week,  I will also be watching this option as well as Primary-C below.

SPX - 15 Min Primary-C

SPX- Daily - Bearish Triangle Option
The old version of this triangle is pushing it so I can't believe that this move up was completing wave e. At best, if a triangle is still in the works, this would qualify as a wave c and can terminate anywhere between the top of wave a and today's close.

Thursday, December 22, 2011

12/22/11 - EOD Update - Golden Cross Watch and Inverted Head and Shoulders [10:55 PM Update]

[10:55 PM Update]

SPX - 15 Min - Option 2
This is a follow up to my earlier post under the 30 min Primary chart. This assumes that the market is working towards five waves up and that wave 3 completed today.

If this is the case, I  will be looking for a wave 4 pullback towards the 1247 level. From there, wave 5 = 3 at 1273 and 5=.618*1 at 1273 as well.

This is a speculative count at the moment.

EOD Update
I'm pretty satisfied with today's action based on last night's post. Today's post is going to seem a little bullish biased but I think there are things lining up that may justify it. However, the major caveat as I have previously mentioned, is that the bulls need to break through the descending trendline connecting the 7/7 and 10/27 highs and ultimately take out 1292.

With today's move and close over 1250, I believe there is a good chance that the market will attempt to challenge 1292 over the next week and/or possibly into the first week of January 2012.

Near term, the market may have a little weakness (or maybe more depending how the VIX is interpreted) but I believe the dip can be bought per the primary count I am currently tracking.

**Note: I'm not sure if all the multiple alternates I post confuse readers here. Please keep in mind that the primary will always be the count I focus on until it is ruled invalid. 

Readers should also keep in mind that if an alternate count(s) point in the same direction as the primary, then it only helps to confirm which side of the trade to be on.  

SPX - 5 Min - Primary

Here's the breakdown at the 5 min level. I believe that wave 1 grey of 3 blue completed today at 1255.22 and that wave 2 grey started.

SPX - 30 Min - Primary
The 30 min MACD ended the day with a sell signal so this may fall in line with a pullback for wave  2 grey of 3 blue.

Please read the note on the chart. I believe there may be a chance that the entire wave up from the 12/19 low may be working five waves up versus a nested 1-2 1-2. I did not add the alternate labels so as not to clutter the chart. Should the market spike briefly at the open tomorrow and then pullback and hold between the 1245-1250 level, I will make the adjustment.

SPX - 5 Min - Alternate Extended 3 Count
This alternate count views the wave off wave 2 blue as an extended wave 3. Per the count, this would only complete wave 1 grey of 3 blue near 1259, which would then be followed by wave 2 grey.

But, as noted above on the 30 min primary count, this may be all of wave 3 blue once complete. If so, this should wrap up early tomorrow at 1259 and then be followed by a wave 4 blue pullback that consolidates for the remainder of the trading day.

SPX - Daily - Bullish Triangle Alternate
Just another view that supports higher prices ahead.

SPX - Daily 50 / 200 SMA
The title of today's post. This daily chart just looks fairly bullish to me, especially when considering my bullish counts.

1. There is a MACD buy signal today that will require confirmation tomorrow.
2. The 50 day SMA is rising fast towards the 200 day SMA.
3. This will be the market's 4th attempt at the 200 day SMA and per Gann's rule of 4, the market just may break through.

SPX - Daily
I haven't really seen anyone talking about the inverted head and shoulders as much lately other than Pug. Let's not forget this especially as the 7/7 - 10/27 TL is crucial for the bulls to break through.

If it plays out, I show a target of approximately 1380, basically challenging the July high.

SPX - Daily 
I just had to post this since I love it when these quirky observations play out. I brought this up on Tues. 

SPX - Daily - Bearish Triangle Alternate
As I mentioned above, the bulls aren't out of the woods yet. This bearish triangle option must not be ignored.

However, I did mention yesterday that a daily MACD cross would begin to weaken this scenario.

VIX- Daily
The VIX found support today on the descending trendline and at the 6/6/11 high. The candlestick resembles a hammer as well so this may be lining up with the wave 2 pullback for SPX or the thrust down out of the bearish triangle.

Wednesday, December 21, 2011

12/21/11 - EOD Update [8:51 PM Update]

[8:51 PM Update]

SPX - 3 Min - Extended Wave 3 Option
Earlier in the CiL today I was asked if my primary count expected a gap and go wave 3 tomorrow. At the time, based on the squiggle count and based on the initial EOD post today (see below), I was not expecting that.

However, I took a look at the squiggles again just in case this may be possible should the market react positively to the initial claims report tomorrow.

The chart above would be considered the count should the market gap and go tomorrow.

[5:21 PM Update]

SPX - Daily - Bullish Triangle Alternate
This is the triangle alternate that also supports my primary daily chart below. Notice how this also fulfills the larger flat as annotated on the daily primary below?

[4:43 PM Update]

I'm not sure if everyone checks the CiL or my tweets for misc charts that I post so I'll post them here again.

SPX - Daily 
 A follow up to yesterday's post.

SPX - Daily 
 Something I have been tracking since July 2010.

TNX -4 hr
The 10 year yield broke out of a wedge which I labeled five waves up. It then retraced the wedge 88.5% in a corrective fashion and has since bounced. Notice the MACD buy signal as well?

Keep an eye on the + MACD divergence there.

EOD Update

The market found buyers at the 50 day SMA and formed a bullish falling wedge. The bounce triggered a 30 min MACD buy signal (confirmation needed) and the daily MACD curling up looking to signal a buy of it's own.

SPX - 5 Min - Primary
The primary count is that wave 3 blue up is in progress. I'm still looking for the completion of wave 1 of 3 blue.

The level to watch to invalidate this count is 1238.91. Should the market move below this tomorrow at the open, the alternate will take the driver seat.

The alternate here is that a wave 2 blue flat is in progress. The new intraday high capped off the end of wave b of 2 of an expanded flat.

I'm not a big fan of the irregular 2 flat so should wave c begin tomorrow, I may relabel the move up from 12/19 as a wave a and b as the irregular flat.

SPX - 30 Min - Primary

SPX - Daily - Primary
The overall picture.
SPX - Weekly - Triangle Bear

As mentioned in yesterday's post, this bearish triangle option should not be ignored and the bulls are not out of the woods yet. The bulls will need to clear the upper TL, which so happens to coincide with the 200 day SMA, and clear 1292 to remove this option off the table.

Notice that this count is looking for the completion of wave e of b blue. So far the move off 12/19 counts as a three wave structure so this count is surely worth watching.

But keep in mind the daily MACD is on the verge of triggering a buy signal and should that happen, that would diminish the probability of this count. As always, we shall see.

Tuesday, December 20, 2011

12/20/11 - EOD Update [6:06 PM-Update]

[6:06 PM-Update]

See comments below on the weekly triangle.


SPX - 30 Min - Primary
So far so good. The market finally broke out of it's corrective channel and looks to have put in wave 1 up. There may be some room for a little more upside and I'm certainly looking for signs of a extension.

Should wave 1 be complete though, I'm looking for a pullback towards the 50 day SMA near 1230. This also lines up well with a backtest of the 12/7-12/9 trendline.

Though the bulls have reclaimed the 50 day SMA, they are not out of the woods yet. They need to clear the TL from the 7/6 and 10/27 highs or else the bearish weekly triangle option may be in play (see below).

SPX - Triangle Option
This option is still in play. Don't confuse this one with the bearish one below.

The last two rallies resulted in a three day white candlestick rise. Will we see the same again?

SPX - Bearish Weekly Triangle
The bulls need to be aware of this bearish option and must clear the 7/6-10/27 TL and ultimately 1292 to void this option.

[6:06 PM Update]

I forgot to highlight the fact that wave e green has now retraced wave d 62% right on the money. So if this triangle is in play it may be deemed complete.

That upper trendline will be key along with 1292.