SPX - EOD - 8/4/10 [Updated: Oct 2007 Revisited]

SPX - Daily MAs

No changes on the count. The 13,21 and 34 EMAs are racing towards the 200 SMA at a pretty steep angle. The 50 SMA is clearly starting to turn up now as well.

I would imagine any sort of sell off in the coming days, if there is one, will find support at anyone of these MAs. The last test was on 7/30 at the

I'm highlighting this inverted head and shoulders once again. So far it looks good to me.

We back tested the neckline yesterday and picked up a little bounce today.The approximate target is 1230.

The major caveat to this is the lack of volume on the neckline break so we'll just have to keep monitoring this one.What may offset this is the weekly MACD indicator as posted here last night.

No real time today. I may add charts later.

Oct 2007 High

So I found a little more time. Remember this chart (See here for prior post)? At the time, I speculated that we were potentially repeating the Jul - Oct 07 period, which would correspond with my preferred daily view.

Since the current death cross, the comparison changed, however, I think seasonality may come into play once again.

I was reminded of this chart after reading Mark Hulbert's "No Time Like the Present". Notice back in July 07 the market found a bottom before posting a new high in Aug? Now look at the chart below.

8/4/10

On the current day chart to the left, it appears we may have found a bottom again in Jul and here we are again in Aug.

Notice how similar the structure is starting to look compared to the above? So do we play the odds?

I will continue to post this chart as the market progresses higher. Getting close to breaking out of the horizontal trendline.

EOD [10:00 PM Update: Transports Inverted Head and Shoulders?]

[10:00 PM Update: Transports Inverted Head and Shoulders?]

Hmmm...


The market was able to stay above the 200 DMA today even with bearish news throughout the day. The media and "pros" claim that the market is trading strictly on technicals right now so given that, the technicals I follow (13, 21, 34 EMAs, MACD and RSI) show that we trade more towards the bullish side short term (60 min).

SPX 60 MIN BULL COUNT

The count above is still my preferred. I made changes to the labels since the 1042.17 bottom.

Currently I show 5 waves up to form subminuette i of minuette (iii).  It is possible that the fifth wave has a little more to go. I believe a squiggle count would indicate this.

The 60 min MACD provided a sell signal today, which would correspond with a subminuette ii pullback is in store. 

I placed Fibonacci retracement targets for subminuette ii. A 62% retracement towards 1090 corresponds well with the 20 day MA, which is the middle bollinger band.

SPX 15 MIN

SPX  DAILY EMAs

Price closed above the 13, 21 and 34 EMAs today. A cross up of the 13 and 21 appears to be in the works. We'll have to keep an eye on this action. It is starting to look like Feb 2010 again. 

 

SPX 60 MIN EMAs

 

The 60 min chart shows that price is repecting mainly the 13 EMA with one touch of the 21 after the 13/21 cross. At today's close, 1099 represents the 34 EMA.

SPX DAILY AUG 2007 COMPARISON

 Just updating this chart once again. Compare this to the Aug 2007 action. Find the Aug 2007 chart here.

SPX DAILY BOLLINGER BANDS

Following up with the 'W' bottom here. The market stayed above the 200 DMA and the MACD and RSI still have room to run higher. The upper band sits at 1123.

SPX 60 MIN BEAR COUNT 1

Once again the bear counts follow the bull count short term. Both are looking for a pullback. However, if this count is correct, it should be the beginning of minute [iii] down. This should take out the current lows. A failure to do so would require that this bear count be revisited.

SPX 60 MIN BEAR COUNT 2

This second bear count also implies the same thing, a pullback. However, this  count, indicates that minuette (iii) down should be begin.

5/27/10 - SPX EOD - HAMMER TIME [5:08 PM PST Update: 5 MIN CHART]

[5:08 PM PST Update: 5 MIN CHART]

SPX - 5 MIN  

Here is a 5 min chart for your viewing pleasure. This main count supports the bull view. The alternate count in gray supports the bear view.

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What a day. The bull and bear counts are still in play, though I will say at this point, the bulls are starting to gain some traction.

The market tried to get over the 200 day SMA but closed just underneath but did close on it's high.

Remember, I'm still waiting for a death cross before I say our super duper bearish move is here. Frankly, on a longer term view, I don't know if there is a Primary wave 3 down. There are other bearish counts out there that point to lower lows but is not considered a Primary 3 wave so we'll have to see.

That is just getting way ahead. Until then, I'm going to try and remain as open as possible, to the dismay of many bears on the CiL.


For those who are not aware or may have forgotten, please refer to the link of my preferred daily count to the right for my overall view at the moment.



As for the current counts, let's start with the bull count.

SPX - 60 MIN PREFERRED BULL

After hovering around the neckline for most of the day, the market decided to climb higher and for once made a higher high since about a week ago. The inverted head and shoulders neckline was breached.

Will it follow through to the target of 1140? We'll have to see.

As I posted the past few days, I continued to focus on the MACD and RSI positive divergence as a guide for more upside to come. That so far has followed through.

The RSI also broke out of a downtrend line and successfully backtested it with a bounce off the old trendline.

As for the wave count, the main count shows that we completed minuettes (i) and (ii) off the 1040 bottom. We were working on subminuette iii of minuette (iii) into the close. So if this count is correct, we may gap up over the 200 SMA tomorrow.

The alternative to this bull count is that we are completing minuette (i) and that may wrap up soon, so there may be a headfake over the 200 SMA and then a pullback for minuette (ii).

I will try to post a 5 minute chart later highlighting the possible alternate count.

SPX - 60 MIN BEAR

As for the bear count, I made some adjustments to the overall count and am now going with the nested 1-2 approach. This has not really been successful lately but it looks like the best option at the moment. 

I have us working on a double zigzag for minuette (ii). Once again, notice that since the minute [ii] top at 1173.57, the bear and bull counts are pretty much the same structurally so the bears and bulls can trade this pattern no matter which side you are on.

I have mentioned that now is the time where we start to diverge and will know shortly which count is truly in play. 

A move back over 1173.57 will void this bear count and frankly create a complete recount for the bears. My bull count has not changed for quite some time now.

SPX - AUGUST 2007 

I keep coming back to these two charts above and below. The comparison with Aug 2007 and the current period is drawing some major similarities. So far this is what is keeping me more bullish than bearish.


Look at the behaviour of the RSI, the wave structure, candlesticks, the relationship of price to the 200 MA and the relationship of the 50 MA to the 200 MA.

If this comparison plays out, it would fit my preferred daily count perfectly, which is calling for one last minor wave C higher. See daily count here.

I dunno know, does it repeat? Who knows but the behaviour by far is somewhat compelling. I will continue to post these charts until the comparison can no longer be made.

SPX - DAILY 5/27/10

Lastly, the charts below are self explanatory.

SPX - WEEKLY HAMMER TIME?

SPX - DAILY BOLLINGER BANDS

Check back later for more...

5/26/10 - E-Mini and Oct 2007 Revisited

SPX - 5/25/10

SPX - 8/07

5/22/10 - A COMPARISON TO OCT 2007

SPX - OCT 2007

SPX - PRESENT

I continue to ask the Primary Wave 3 proponents why not wait for a 50/200 day MA death cross before truly getting married to the idea that we are in Primary Wave 3, assuming this even exists. Remember Y2K?  :)

As a side note, here is a link to 10 failed doomsday predictions. Google for  more of course. 

Anyway, there are still valid bull and bear counts that apply so one should certainly remain cautious.

No doubt the near term trend is down but for how much longer? I continue to mention the 50/200 day MA death cross because as is evident in the top chart, it signaled the larger change in trend. 

On the same top chart, notice where the 50/200 cross occurred. The market backtested that cross, which appears to be consistent with a wave 2 retrace prior to a wave 3 down.

But prior to that, take a look at the structure before to the Oct 2007 top. It looks eerily famliar does it not? The index sold off almost 6% below the 200 MA only to rebound to new highs. The RSI print also looks similar to what we are seeing today. 

So fast forward to the present. We are currently looking at a very similar situation with where price stands in relation to the 200 MA as well as the low RSI print of 30.17. The low print was approximately 4.2% below the 200 MA.

Notice that the 50 MA is only starting to slope/curl down while the 200 MA is still rising. It did that in 07 as well as price was climbing to a new high. 

Look at the 3 wave structure I continue to point out with the orange lines. That is all it is at the moment, three waves down. 

Will all this mean anything? Perhaps not, but just throwing caution to the bears as I play devil's advocate. 

My preferred count still calls for a Minor Wave C up once Minor B is complete but also mindful of the bear count.

Let's see what the next few weeks bring.