10.31.2011 -- Stocks are spooked

Happy Halloween! Late update tonight due to candy eating and all.

Stocks got spooked today. I didn't think the bear flag from Friday was quite done, but we went ahead and gapped down and broke it on the open today. Will be interesting to see how this pans out here. We should have some questions answered soon.

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Key Levels

Upside -- 1274, 1311

Downside -- 1245, 1230, 1218, 1188

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SPX Daily;

Pretty ugly reversal today that closed at the low. You can see we closed in an open pocket there which is why we closed at the low. We need another 12 points south just to hit our first level of support from here and that's just the mid bollingers.

Our bollingers are still pointing up and the 50 and 100dma's are curling up.

I dont think we can really start falling apart until all those things roll back over and are pointing south again. That's not to say we can't just fall right through them all and not stop and then cause them all to turn downwards because of that... we could do just that. But all three of those things will provide stronger support for the market as long as they are all heading north.

MACD is at 23.65. That is the third highest level in the last 10 years.

The other 2 occured just slightly higher at 24.77 and one was at the 2007 high and the other was just after the severe bounce that occured at the 2009 low.

The Stochs are still up above 80 and may start turning down here and flip to a sell.

Its interesting to me that the market got hammered pretty good today but we got very little movement south from the MACD or Stochs.

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Other items of note.. the weeklies are still on a buy here but the Monthlies are on a sell like the daily is about to.

To really get moving on the sell side, we'll need to get under 1230 first and then getting under 1188 will put the cherry on top.

GL

CJ

10.27.2011 -- hold... holllllddd.... HOOOLLLDDD...

9:00 p.m. add.. I've changed the settings so that anyone may leave comments without registering with blogger or having a google account. I had a temporary nusance who appears to be gone that caused me to change the settings.

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In the words of William Wallace in Braveheart.. we are almost there but we are holding... waiting..

Not quite done, but I think we are very close.

Doesn't feel very bearish does it?

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Key Levels

Upside -- 1300-1306

Downside -- 1274, 1255, 1230, 1209, 1183

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SPX Daily;

We are in our target zone here. I've increased my position to 30% short now. I will top out at 50% short here soon with anything over 1300.

If you got back several posts, you will remember that I posted that it will seem like all is clear and everything looks awfully bullish and most shorts will get squeezed out of the market. All the while, moving so fast that it would have been difficult to get long.

That is the nature of the bear. It burns both bulls and bears.

These are the times you must trust all the analysis that you've done and stick with your plan and execute.

Of course I must have a stop loss/breaking point. Mine here, is if we take out 1325 and/or we spend more than 2 weeks closing above the 200dma. Then I may close this position and take a step back.

That is the prize for the patience of waiting, .. if I'm wrong, then the pain won't be tremendous, as long as I admit i'm wrong withing a reasonable time and within my limits.

I don't think i'm wrong though.

Bradley turn date tomorrow, other fibonacci time relationships.

The MACD is at 21.. which is right in the zone of all major tops on the MACD in the last 5 years. The stochs are still rolling up above 80. The short term charts (30 min and hourlies) are tremendously overbought.

Elliott Wave tells us very bad news is coming soon. Who knows what.. reversal of the greek bailout, a larger country rolling over, a tsunami, a volcanoe.. who knows.. but something is coming and soon.

GL

CJ

10.26.2011 -- A little clearer each day

Nothing earth shattering today, trading was pretty technical. The rally today though is probably eliminating the possibility that we are in wave 5 down. The only way for that count to stay alive is if we really fall off a cliff here in the next day or 2.

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Key Levels

Upside -- 1257, 1274

Downside -- 1229, 1223, 1207, 1181, 1134

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SPX Daily;

You can see there the market traded pretty technical today. We broke down into the channel and then bounced off the mid-bollingers and managed to get back through resistance and closed positive.

We did wear down support though at the top of the channel and 100dma.

Only other thing of note is that the MACD is now at 17.45.. this is above 5 points off the highest levels its been going back 5 years. 21-23 seems to be a very popular top for the MACD in recent history. The Stochs are also very overbought here and have been.

Turn dates approach. 200dma is within 30 S&P points.

GL

CJ

10.25.2011 -- Pull back or rally over..

Pretty ugly day overall with earnings, AH too with AMZN. Banks took a whacking and so did a lot of growth leaders. Volume was overall on the light side though.

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Key Levels

Upside -- 1237, 1274

Downsie -- 1227-1230, 1221, 1204, 1180, 1136

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SPX Daily;

We threatened today to make this breakout of the 100dma be a fake out. We are sitting just over the 100 and the old channel.

Still extremely overbought on the Stochs and approaching extremely overbought on the MACD. (Long term, on a 5 year chart, MACD never exceeds 23 with these settings and we are at 16)

Key will be whether we dip back down into this channel and below the 100 again here this week. I think we will, but we'll see.

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From an Elliot Wave prespective, there's 2 options here.

1) Most have moved on that we finished the first major wave down (5 waves down off 1372) and are now in a counter-trend rally, an ABC correction of that move down. IF that is the case, then you would conclude that we have likely finished A, possibly finished B and this is a quick pullback before charging ahead yet again to finish C up of the correction.. OR we just finished A and today was the start of B down of the A up, B down, C up correction. In which case, the coming C up after B down would likely get to the 200dma and probably exceed it for a short time before finishing.

2) the scenario not many are considering.. That the 1077 bottom was only the bottom of Wave 3 down of 1 down and we just finished Wave 4 up and are now embarking on Wave 5 down and are just now starting the last wave down to complete the first major 5 wave down pattern.

......

I like option 2 for several reasons...

1) it fixes the timing problem. That means we are going to collapse again right now and probably take out 1077 and then bottom for the first major 5 wave structure and THEN start the counter-trend rally that we all believe we are in now. That would allow for the usual christmas rally.

2) It would burn a lot of people on both sides.. bull and bear.. Bears wouldnt see a move coming right now to the low 1000's or high 900's that started today. And they definitely wouldn't see yet another rally to the 200 occuring after that. Bulls would once again watch everything melt before their eyes and it would be difficult to believe the market could stage yet another rally.

3) It would actually just be a cleaner count if it went down that way.

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We shall see.. option 2 would move quite a few people backwards who have moved forward way past that spot.. but the market has appeared to move so quickly that it just may make sense.

GL

CJ

10.24.2011 -- Happy bull joy

I clearly remember the counter rally to the 200dma in 2008. The 2 markets look extremely technically similar.

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Key Levels

Upside -- 1274.. really nothing stopping us from getting there other than being very very very overbought at the moment

Downside -- 1231, 1217, 1200, 1181, 1121

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SPX Daily;

There's our target zone. We are over that 1250 mark. 1274 is the 200dma.. We have a possible spike wash and bull trap up to 1290ish.

Feels pretty damn bullish doesn't it? Thats what these things do. Rip and burn.

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There's a significant fibonacci time cluster and Bradley turn date through the rest of this week.

Obviously it's going to be some kind of top. Just not sure if it will be THE top of this yet or just a little blip down to reload for the rest of the run north.

Because of the expected power of the next major downmove, it will be fairly obvious which one it is once we start to reverse.

I think the obvious guess is that Europe is going to disappoint the world this week.. but something could come out of left field..

The biggest thing that bothers me about all this is that our countertrend rally has moved so tremendously fast that the timing leaves no other option except the market crashing into the holidays...

very odd timing..

we'll see..

GL

CJ

10.20.2011 -- News driven or noise?

Not much changed today, but I do have something to show you of interest.

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Key Levels

Upside -- 1222, 1223, 1274

Downside -- 1201, 1184, 1177

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SPX Daily (3 months)

So we were tanking in the morning and then a report came out that the German government spokesman was going to make an announcement about the ESFS around noon.

The market immediately reversed after that news and continued higher all the way until 1:30, the news was simply that any decision was being pushed until next week, the market sagged just a bit and then kept moving higher.

It's easy to say that all that was gyrations based on yappty yap yap coming out of Euro land.

But if you look at the chart. Look where the market bottom and reversed. Exactly pinpoint at the top of our channel.

Is it just coincidence that the news of the ESFS announcement came just as the market hit that point and reversed? Or can you really just find any piece of news and say that's what moved the market?

Does any of it really matter, or is it all just noise as the market will ultimately follow the path it is going to anyways?

Long term Elliot Wave analysis no matter how you count it, strongly points to us hitting S&P 500 or lower sometime in 2012, maybe 2013.

If you eliminate all the noise in the middle.. lets see how predictible the market really is.

GL

CJ

10.19.2011 -- Hovering...

We are still stuck in the same area we were yesterday. The daily stochs and MACD appear to be rolling over though.

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Key Levels

Upside -- 1224-1235, 1275

Downside -- 1209, 1198, 1175, 1138

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SPX Daily;

Here we have our 2 channels or wedge depending on how you want to draw it.

I THINK we are finally about to pullback a decent amount. You can see the bollingers are rolling over, the MACD is rolling over and the Stochs are rolling over. In a raging bull market, sometimes those signals are tricky and will roll gently along the top while the market keeps churning ahead, but in this case, I think it signals pullback time.

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Our growth leaders followed up their flat day yesterday with pretty good sell offs today.

AMZN, AAPL, CMG, LULU, PCLN, NFLX.. all down pretty good.

Nothing much else significant.. just watch for reports of euro shitting bond eating cows to be genetically engineering in Europe. News like that could be released at any minute.

GL

CJ