Min DJIA 2015 Review.

 

YMY00-May-16-2016

Recently I showed a potential “B” wave top in Primary degree, but we have the basic nightmare of wave peaks, that eventually have to be sorted into where they still belong to.  The bullish side (still correcting) or if we are already over on the bearish side. Expanded tops can always fool the best wave counters, and with so many peaks we have to be on the look out just in case. 

One scenario the DJIA can push to a new record high, and the other scenario is that the DJIA must not push to new record highs. Talk about flipping the coin. 

Of course the reports that Warren Buffet has bought parts of the DOW with the last quarter, March 31 purchase of IBM and Apple stock could add an extra boost to these stocks this morning. This week  should tell us more, but until it really happens, we will never know.   Could there be this “Thrust” after a triangle? Sure, but if we are in a big bear market rally it may be pretty rare when we can be so close to an end. 

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Comment On: Goldman Surprised by Sudden Oil-Market Turn as Glut Vanishes

Again and again it has been proven that when markets are at the extreme, fundamentals will always tell us the wrong things. The experts get surprised more than anyone, because most of the fundamental news you hear, are lagging indicators. Chances are good that all the experts have no clue how high the price of oil may eventually go, but I am sure the parrots will come back and tell us that $200 oil is just around the corner. Good luck with that, because if crude oil ever got close to $200 then the next price crash will be down to $10.

Goldman Surprised by Sudden Oil-Market Turn as Glut Vanishes

http://oilprice.com/Energy/Oil-Prices/Oil-Markets-Balancing-Much-Faster-Than-Thought.html

CLM16-May-16-2016

Terrorists keep trying to blow up the energy infrastructure in Iraq and other places, so world oil supplies can remain choked.  One thing that makes a difference in the long run is that higher prices bring on more supply and when any bullish phase, runs into exhaustion, buyers usually don’t show up,  and prices implodes.  

This rally still has a long way to go before we get close to the potential “A” wave that I am after. So far this rally is more like a diagonal pattern, which would fit into an “A” wave. At this time, I would expect the “A” wave between the $60 or $90 price levels, which is close to the $55 and $89 Fibonacci numbers I always use. 

We don’t want to get too far ahead of ourselves, as many may misunderstand it, and think that it is going to happen right now. When we look ahead, we are just looking up or down the idealized wave count, and describing what we see as best as we can.

The gold/oil ratio Just dipped to about 26.75:1, which is still very cheap when compared to oil. When oil falls below 20:1 we have to be on the lookout for another corrective top.  

 

 

 

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Quick Apple Update: Crashing Like A Zeppelin!

 

AAPL-May-15-2016

 

Apple’s stock chart has rolled over a long time ago, as the trend lines show.  If the markets are on a general Primary degree “C” wave decline, so why should AAPL not do the same thing?  In a bearish phase all the ugly news will become front and center,  so if AAPL continues south, then expect more bad news.  This will be news that the mainstream dream up, but recent news from the Apple Insider, sure still look good. Apple still dominates, and overall it is a good company. 

AAPL could be of the same type of a path as the general stock market is, but where and when it will bottom is next to impossible to estimate. With all the buy backs and stock splitting antics we could be dealing with new numbers that will stun us, in how cheap AAPL stock can get.  Going back to 2007, at what previous gully (bottom) is apple going to stop at.  Any expanded flat type move will definitely send AAPL back to record highs but we would go broke in trying to stay in to see that happen.

Until we hear news about insider buying, investing in this stock price, will be a disaster. I am sure we will see the $70 price yet, as a huge gap will be closed by then, and even $30 is not ruled out. 

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Mini DJIA And Mini SP500 2007-2016 Review

It has been about a year since the markets topped, followed by a sideways pattern that gave us one wild ride and kept everybody guessing as to what the real trend can actually be.  I was bullish at the beginning of 2016, and now we have had a run that started to stall and even reverse.

For both indices and since the 2009 bottom, it has been a constant back and forth effort, counting between a diagonal 5th wave and a “B” wave bear market rally. All this back and forth has to eliminate some probabilities and hopefully this has started to happen. Connecting the 5 simple wave patterns in their right sequence is the key to helping us figure out where we can be, in the bigger scope of things.  As I have mentioned, my work  all comes from looking at the markets from a Cycle degree perspective.  The trouble is, we have to find out where the wave three may have actually peaked at.  I spent years, counting in GSC degree and then dropping it down to Supercycle (SC) degree for a few years. They both made no sense as I always had more patterns left and big bullish moves were missed 

I did see a big improvement when I switched down in degree levels, but SC degree was not low enough. Since about 2013 I no longer chase that SC and GSC degree dragon, but chase the Cycle degree dragon instead.

The entire work of this blog will be in looking for and chasing the entire 5 wave sequence in Cycle degree, without it we can never travel into the SC or GSC degree worlds. Many have tried and many have failed, besides Cycle degree comes before SC degree, so why waste our time on a degree level that still could be decades into the future.

YMM16-May-14-2016

 

With this wave count I have switched my Cycle degree back to the 2007 top, creating the “ABC” crash into 2009 as my “A” wave in Primary degree, possibly topping in May 2015. This keeps the 2010-2011 correction as a running flat inside the “B” wave bull market.  Since I am chasing Cycle degree patterns, the wave pattern I would need is 5 waves down in Intermediate degree, of any type. Chances are very high that diagonal waves will dominate all the way down, and it will not be a walk in the park to catch all the turnings.

What we see now can be the first wave 1-2 that we would need and then we have to see if the wave 3 ends up being extended. This is where  the 1-2, 1-2 wave count would come in, and it would all have to play out when it got close to a double bottom or even 6000 before it ended.  If and when this gets completed, they may still be calling for it to get much worse or even calling for DOW 400-1000.  This is when I will be  “EXTREMELY ” bullish as we would have just completed an expanded flat.

Expanded flats are very bullish wave counts depending on the degree we think we are in, and they seldom have very long extended “C” waves.

From the 2000 peak to the 2009 bottom we had about 8 years, now from the 20017 to the 2015 peak we have had about 8 years.  Could we have a decline that takes about 5 years? This would put us at the 2020 time period. If we use a potential 13 years as a bear market for stocks, then from the 2007 peak plus 13 years, gives us the 2020 time period. Is 13 years long enough for a Cycle degree 4th wave correction? Of course it sure can be as it fits very well into whole Fibonacci numbers.

Besides this 2020-2021 time period, we also have solar cycle #24 ending, which are always  followed by a 4-5 year solar cycle bull market. I cannot stress it any more, if all the wave counters, and others are still showing you bearish wave counts, then you will miss the bull market bandwagon again.

For the short version, we are looking for 5 waves down in Intermediate degree, with wave 2 possibly already completed.

 

ESM16-May-14-2016

 

This is the Mini SP500 with the basic same wave count. Many times there are differences, but they all end up in the same place sooner or later.

Are we heading into a depression? No, I don’t think so, but another wicked recession sure cannot be ruled out. When they  start calling it a depression, chances are good the next bullish wave 1-2 will be ready to start.  All we have to do is go and look back to 1932-1942, when we had a complete Cycle degree come and go. If you did not read your history books, but looked at stock market charts you would never figure out that there was this big depression in the 1930’s. 

Since rolling over, the markets have been struggling to push higher so this is always a good sign of a bigger potential bearish move to come. 

Can the anticipated (not confirmed ) 5 waves down go to the 2009 bottom price range?. You bet it can! It can even go a bit lower, but the idea of a long drawn out “C” wave going back to the 1970s or even 1930s price levels is not in the cards at all.  The SC and GSC degree wave counters will be in their glory as they will end up being proven right if this decline is real.  Technically speaking a SC degree 4th wave could be completed so all the SC crowd must turn super bullish when this decline has fully played out 

What is dramatically different is the degree levels we think we are at. Being out, by just one degree is like being out a mile, or out by a “Fibonacci multiple”, would be a more accurate description. 

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HUI, Gold Stock Review 2011-2016

 

HUI-May-14-2016

 

As much as I hate to be bearish on gold stocks, the HUI and GDX have slowed to a crawl recently, and in order for the next leg up to happen, we need a good correction. The trouble with that is, that this decline can also give us a zigzag like pattern. If a flat were to develop, then one would stop before going to new market lows, and the other “should” make a new bear market low.  Gold stocks could fall in sympathy with the general stock market, as people will panic and sell off everything once they realize that even gold stocks can drop like a rock.

Any 5th wave down should be short as wave one is fairly short as well. Wave 3 is the extended wave. Besides the index can’t go to zero nor should there be any inverse splitting. I can get the entire gold stock bear market into a diagonal 5 waves down in Intermediate degree, and we may be finishing the 4th wave. If any decline proves my scenario right, then we have a good chance of getting a full fledged bullish phase pop out the other side, but only after any 5th wave down has completed. 

In other words, we could be looking at a move with 5 waves in Primary degree, heading to new record highs. It sure did not take the HUI that long to reach a screaming high in 2016, so we know what we can expect once the HUI cranks up again.  

It would be useful to develop a record, what the gold/HUI ratio has been, as that may be helpful in figuring out when gold stocks become expensive or are cheap. Just taking a few quick measurements today, it seems that an expensive ratio has hit 3:1 and a cheap ratio did hit 10:1, At present we are sitting around 5.75:1, not exactly an earth shattering ratio, as it is not anywhere near the extremes.

For the time being I am  very bearish on gold stocks, even though I have had no earth shattering news about insiders selling. In mid 2013 insiders were buying gold stocks left and right.   

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HDGE, Crank It Up!

 

HDGE-May-13-2016

 

I will make it short on this HDGE, but once I studied most of the other indices, this HDGE may have seen a major low, and it has much further to travel.  Again, it ended very close to the end of April, which is also the low for 2015. Now we have to look forward to the high of 2016. Markets do not travel in straight lines like I have shown, as this was drawn in just for dramatic effect. 🙂 

I have no clue to what that price will be, but what it ends up with will have to happen late enough in the year, so it has no more time to move higher. 

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E-Mini S&P Midcap Intraday Review

EWY00-May-13-2016

I also made some changes to the S&P Midcap index, as it has one of the best fitting impulse waves that I have run across.  It looks like it has turned the corner  in late April as well, so now we have to be patient to see if the trend continues.  The short story would be a 5 wave decline in Intermediate degree finishing a potential Primary degree “B” wave top. 

The only way this will work is if the rally since the 2009 bottom was in fact a bearish rally, which would make it an expanded pattern. Expanded patterns are extremely bullish after the 5th wave decline has been fully exhausted. This must be lower than the 2009 bottom, even if it is only by a few points. So if this is all real, and I’m not chasing another mythical dragon, then this S&P Midcap could end up closer to the 400 price level, when it is all done. 

Of course, anything can still go wrong and hopefully we will be alert enough to catch any big mistakes.  

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WTI Crude Oil Bullish Phase Review

 

CLM16-May-13-2016

 

This is still the June contract, but I am displaying it in line mode, which can dramatically change the wave count. It is one way to look for alternate wave patterns, and I need all the help I can get. Counting this out of what I expect may happen is not going to be a picnic or slam dunk deal, as there are at least 6 various zigzag patterns that can happen.  I eventually need a three wave bull market in Minor degree,  which ends up being one move or one “E” wave in Intermediate degree.

At this time I don’t think we are anywhere near the first “A” wave in Minor degree that I need, so hang on as this market can turn pretty wild.  It looks like a diagonal is in progress, which can move around for a long period of time, and not change direction, until we least expect it. Any diagonal can plunge without much warning and panic the herd in the process.  I look for setups that will panic the herd, as this can produce moves that force all the players to jump from one direction and then jump into the opposite  direction. Traders cannot handle the drawdowns so they are forced out of their positions. 

The big picture is that I am working a triangle “B” wave in Primary degree and we still need one major leg up to make this a reality. 

The gold/oil ratio between gold cash and the June oil contract, is about 27.60:1. This ratio is still very healthy and oil is still cheap when compared to gold.  No reason to get into a panic at this time. I will also try and post the big oil wave count review this weekend.  

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Mini SP500 Daily Cash Chart Review

 

ESY00-May-13-2016

I posted the DJIA with a new wave position for the 2015 peak as at this time that peak is the high to beat. Of course, unless we are going to slide down the slippery slope of 5 waves, that 2015 peak must not get touched anymore. This gives us a very small window of error, but being a small window can also help to eliminate a wave count.

Unless something dramatically changes the picture, I will run this wave count for the time being. This would also make the SC and GSC degree crowd happy as they finally would get their 5 waves down in Primary degree. But what if it is only in Intermediate degree? Ah, that does make a huge difference, as our price expectations would be radically different.   Five waves down is a setup for  failure to be ready for another bull market that will be sure to follow.  Chances are good that the majority of wave counters will be oblivious to this fact as they may still be chasing  SC&GSC degree wave counts.

This is an ugly wave pattern at this time with an expanded pattern for the “B” wave correction, so we still need to on the lookout for other possible wave counts.

Right or wrong, I always like to prepare readers as sometimes changing herd thinking is like trying to stop a speeding truck going down the freeway, needless to say they don’t turn on a dime.

 

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Mini DJIA Daily Chart Review: Friday, 13, 2016

 

YMY00-May-13-2016

 

Is Friday the 13th going to be a bad luck day for stocks? If anything, it’s always a good story, especially if I review my largest degrees that I have been using. I am making a big change to my wave count as this sideways choppy market has taken far too long. I can start to make an impulse fit, but it will be part of the diagonal family.  This wave count turns the May 2015 peak into the “B” wave in Primary degree, and it would push the Cycle degree back to the 2007 peak. 

This has the same effect as jumping into the future, but with a paper or electronic time machine. 

We are coming up to just about a year since the 2015 top, and from it we can at least give it 2-3 years to play out. If this is the start of the “big one”  that everyone has been waiting for, then it could still take a few years to get to the bottom. SC and GSC degree wave counters will be jumping up and down with glee, as their big 5 waves in Primary degree has finally started. Except there is one small problem with that, and that is the degree of this decline. Even though it may only be a difference of one degree level, it will make a big difference once the bottom is near. Being out by one degree is like being out by miles in sequential wave counting.  

  I will create a bigger wave count later on the weekend, but changing our thinking or keeping an open mind is necessary, as we could be in for 5 waves down in Intermediate degree. The markets can still fight us all the way, or an ending diagonal may also still form. Either way I’m going to use the Primary degree “B” wave until further notice and we have little room to move to the upside with.

With a “B” wave top it would be the first and only expanded flat top, which are very bullish wave patterns in the long run. They also don’t run that deep, but it must surpass the 2009 low to get confirmed. DJIA 6000 or bust, but all the SC and GSC degree counters may be calling for DOW 1000!  This DOW 1000 forecast will never happen!  If this crowd is setting up for another failure will not surprise me, as the herd never learns, and make no mistake about it, wave analysts travel in herds! Maybe they travel in flocks as they parrot each other   

  This also means Apple the big elephant in the DJIA room, should have much further to fall as well.  

 

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Gold Intraday Crash Review

GCY00-May-12-2016

Gold has imploded again today after a wild spike to the upside. I sure can’t count the last peak as part of an impulse, but it still may be a diagonal bullish phase.  The June contract has already pushed much further south, so that $1256 range may not hold, and it would put the potential diagonal wave count back into inventory. 

Today is a shorter commentary  as Friday may give us more answers.  I also try and keep posting on gold regularly during the week, but rarely at set times.  I would like to post on many more different things, but find I am always hard pressed for time. It may look simple drawing up wave counts, but you can spend double the time doing the research before you even get close to make the first letter or number.  I will not post most Sundays, Canadian and US holidays but occasionally review the bigger degree wave counts during those times.  

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E Mini Nasdaq 100 Intraday Decline Review: Walking To A Different Drummer!

 

NQM16-May-12-2016

This Nasdaq 100 and the full blown Nasdaq sure walk to  different drummer it it seems to be the odd one in the bunch, That is ok but it also requires that there may be a possibility of an Intermediate degree wave 1-2 already completed and we are working the slippery slope of potential wave three.  Right now we could be in a wave 2 rally, but only in Minuete degree as any wave 1 in Minor degree would still be too early.

Of course, anything can go wrong, but we don’t want to miss this because we got our heads stuck in the DJIA or SP500.  If any future move ends up crashing straight down and not go to a new low, then I would have to change my mind very quickly.  So this anticipated rally will be the key, as there may be a chance that the pattern is part of an  expanded pattern as well.

One other pattern could that the Nasdaq 100 sinks with a zigzag as the opening to a Primary degree “A” wave. That would mean that my Cycle degree wave 3 may have topped already.  A big zigzag leading into a Primary degree flat makes sense to me, but we must always be prepared with alternate tools in our toolbox of wave patterns.

My toolbox always contains a minimum of 5 different types of idealized waves, and we can combine all those to make 8 more patterns for a total of 13. Complex patterns out number the simple patterns by a 40/60 ratio. (.382/.618)  I do not consider WXYXZ waves as being any use as they hide diagonals and triangles very well.

Short term I am a bit bullish but only until this next anticipated rally burns itself out.

 

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HDGE, Bullish Phase Review!

HDGE-May-12-2016

 

This HDGE ETF  has made a beautiful run up, but a spike has also shown itself. As you can see we have many spikes that form and I target these patterns with potential wave counts. I have included a wild expanded pattern, but that will get trashed as soon as we see what type of HDGE correction we are going to get. 

Anymore extreme bullish runs in stocks will give us a bearish move with HDGE. The thing is, it doesn’t have the much room to fall before it can hit inverse stock split territory.  The further HDGE heads north the less of a chance there will be for an inverse stock split. Short term I have to be bearish with HDGE,  but not in the long term.  

The VIX suggests the fear factor can head higher so this would all be negative for stocks. 

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WTI Crude Oil Intraday Review. New Bull Market High?

CLM16-May-12-2016

Crude oil broke to a new record high, but ever so slightly. We still have a chance that an expanded pattern is playing with our minds, from which we can still get a pretty good crash. Most sharp down moves can fit into a potential “C”, so if this happened I would turn very bullish.

The run in oil also fits another very good impulse so that could mean another leg up.  If the last three days was an impulse then oil has to perform with a stunning run.  If I see a correction forming in the next day or early next week, then I would turn bullish much sooner.

I have mentioned the wave count that I am after in oil, but there will be at least 6 different versions or different looking zigzags that we have to watch for.  On this potential “E” wave bull market, we need an “ABC” in Minor degree and I don’t think we are anywhere near the “A” wave part.

We may still be dealing with an ending diagonal, but that possibility is getting less and less. Short term wave counts can be a real problem to sort out, especially in commodities as there is so much leverage that commodities produce wild swings, that are unthinkable.   

It will not surprise me if it takes the next three years for this mythical “E” wave to play out. I know we always have alternate wave counts, (minimum of 5) but we really don’t need them right now.  We will need them when the patterns start getting really choppy and the gold/oil ratio implodes.  

I focus on the big pattern that peaked in 2008, which came all the way around until the crash in 2016.  This I call a single zigzag, and not a “WXYX or Z wave. 

Sometime in the future when oil passes $115 again, I am sure we will hear talk about $200 and $300 oil. When that happens, look at  the gold/oil ratio as an added contrarian indicator. Chances are good that oil will crash into another world oil glut, and it may hit $10 at that time.  If I mention prices this far ahead and this early, many think that it will happen now. Any Cycle degree 4th wave bottom in oil could still take until 2021. 2021 will be 13 years from the 2008 low.  It took oil a little less than 5  years to rally, before it imploded again. 

 

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Mini DJIA Intraday Price Action Review

YMM16-May-12-2016

As much as I would like to believe that we are still in a potentially impulse, I have to explore the diagonal or even a triangle option. From the top, I have too many key overlapping wave patterns, and a new low will help to confirm my suspicions. 

It could still be the bottom of a wave two, but this market will have to perform to confirm that. At this point the markets are soft and have no energy to go anywhere except sideways or down. We will be lucky, if it will get resolved before the weekend.  

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US Dollar Intraday Rally Review

DXY00-May-11-2016

The US dollar executed a nice move up and now has started to correct, helping gold and oil’s bullish moves. Where to next? The decline can be an impulse type of a move which would have much further to run.   

What I will be looking for is some type of a potential correction, which could end with a sharp trip down. At the 93.300 price level most of this wave count will be failing  and then a potential diagonal wave 4 up, may already have been completed.  Either way we have a pretty good spike, ending on May the 2nd so this may be hard to retrace, at least in the short term. 

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Crude Oil Intraday Bullish Rally Review.

CLM16-May-11-2016

I have talked with several members that trade oil futures, and they have mentioned that they like the intraday reports that I do.  I am not really a trade setup guy as it is next to impossible to relay that information timely enough to a large amount of readers. What I like to do is make aware or work on turnings that force all the players to abandon one direction, and then jump into the opposite direction.  The majority of traders cannot handle wild swings (draw downs) so they are constantly forced in or out of most positions.

Not the ideal thing that traders want to do, but it is something that happens all the time.  If we look at the chart above, we can see a low on the 9th of May, and then a rocket move into today.  Any break to new record highs at this time would kill the zigzag wave count, and then we must look at it from a potential triangle pattern. 

I have mentioned in the past many times that we are in a potential zigzag bull market that could push oil back up above the $115 price level or higher.  Right or wrong, I visualize any move when I can, and then figure out the different idealized wave patterns and their degrees before they ever happen. When the markets shift to dramatically then I know and alternate scenario must be found. 

In short, I would look at 6 possible zigzag corrective patterns, potentially lasting a 3 year time period. 2019 would also make it 100 years since the 1919 peak of a big commodity phase.  

At what price level this potential Minor degree “A” wave will turn on, is the million dollar question, but the $55 and $89 price levels are good places to start looking. Whatever the outcome, chances are that the zigzag will not be even or pretty looking, but we can also apply the 60/40 ratio to the net move. If the Minor degree “A” wave ends up “.382” or 40%, then we may get a 60%, trailing “C” wave. 

This may all sound wild, but look how wild the oil market can swing. Even EWI is very bullish with their oil wave counts, and they are on a completely different wave count and degree.  Once this unconfirmed “B” wave in Primary degree gets hit, then we better hope that we don’t get another 3 wave major bear market.

Hits: 5

Gold Intraday Rally Review

GCY00-May-11-2016

This rally has so far been very impulsive, so I had to look for a wave count where an “ABC” has finished. The only way I can make it fit was with an expanded wave count.  Now if this is the start of an impulse or another much bigger zigzag,  then we would have much further to go and another leg up would happen.  This leaves us with what gold should not do if the impulse pattern is true. Gold should not fall below that $1258 price level and work at a 60% or 40% net corrective move. 60/40 is the Fibonanacci ratio simplified. 

We should know more by the end of the week as this rally was 1 day long.  June  Crude oil has also exploded, creating a 27.67:1 gold/oil ratio.  A far cry from 45:1! 

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Gold Intraday Crash Review

GCY00-May-10-2016

At this time gold has made a splendid recovery from its low this morning, but the rally could still be a 4th wave.  We are getting closer to a zigzag decline, but as I have mentioned zigzags can be the exact same thing as an impulse decline when they start.  For a zigzag I would like to see a bit longer trailing 5 waves, but for a more bearish story we could be in the next phase, wave two top as well.  As usual, we are caught between a rock and a hard place when this happens, and the only option is to eliminate the patterns that no longer work.

I would love to be very bullish at this point, but we have to see how the next small decline forms.  

 

 

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Natural Gas 2008-2016 Review

NGM16-May-10-2016

I mentioned in the past that NG still had to fall below that $2 range. It most certainly did this, but now what? NG does not run on your average looking impulse as its biggest bear market looks more like a diagonal decline, but with an expanded pattern in the 4th wave position. Will this low of $1.85 hold? Futures Natural Gas charts are horrible to display, as they will not work on the cash basis as there is not enough volume to display. Needless to say I have never been able to keep a detailed wave count on NG itself, and I don’t review it very often. It’s not at the top of my list.

Eventually we should see an NG breakout over those $6.0 peaks. With drilling rig counts crashed, I can see a squeeze in energy prices, as electricity production will be more in demand. How else do you think we can keep all those Tesla electric cars on the road?  Solar Power is not going to do it!  They may even have to bring coal back online, even though Obama tried to kill coal off.  

Hits: 6

WTI Crude Oil Price Bounce Review.

CLM16-May-10-2016

Crude oil is bouncing around like a wild jack rabbit. Even though oil has not corrected deep enough for my liking, a triangle may have taken place. Of course our present little rally could run out of steam and then head down again to a much lower price level.  Oil could double top at $46  which would give it an expanded pattern, and that eventually will send oil crashing once again. 

From my perspective, the crude oil’s big bullish run is still alive as this sideways type pattern is a big clue. Since the 2008 peak, oil has traveled from one extreme down to two other extremes, and now it should travel up to another extreme. How high of a price does not create an extreme, but it is the intensity of the bullish sentiment that does.  If oil ever soared to $148 and all analysts are parroting $200 or even $300 oil, then we look at the contrarian indicators, like the gold/oil ratio. 

Time and time again the markets have always gone the opposite direction than the herd that is playing it, and this will never change. This also shows that at the extremes the markets travel the opposite of the fundamentals that the majority believe in.  Steven Jon Kaplan, from the True Contrarian knows this very well, and I have seen him make fantastic calls with oil. 

 

scan0112

This is what I had created just before the 2008 peak when I showed my bottom range where the price of crude oil could end up at.  Of course, this was all done in SC degree, before I woke up.  As I have said many times, this is a forced wave count, and it is done with a linear setting.  

 

Scan-080804-0007

Most of these oil SC degree charts, are done with collage type old school cut and paste work, but on this page we have what is called the magazine cover indicator. “The End Of Cheap Oil”, How totally wrong, they ended up being. Within 8 months we were back in a world oil glut. 

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Mini DJIA Intraday Rally Review

YMM16-May-10-2016

This Mini DJIA took off in a rather pretty good looking impulse as I saw there was a potential expanded wave 3-4 in there as well.  We will find out shortly as we should head into another correction as this sequence plays out. Any decline that contains a potential “ABC” crash will then give the DJIA another leg up. Any correction can come all the way back down to the 17,600 price range and then crank up again. The deeper the correction the weaker the overall drive will be. I will try and include the degrees at times because we are looking at fairly small degree levels, and I don’t always have the room to fill in all the wave counts even if I wanted to.

Short term we need a correction, and if this correction pans out to what it may be then another leg up will happen. I don’t think we can look much further ahead than one leg at a time, and then see when we have 3 legs up (1,3,5) or two legs down, (A and C)  

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Tesla Crash Review.

TSLA-May-9-2016

TSLA is another prime example, how a fast move up will stop dead in its tracks and then reverse. I am showing you a potential expanded type pattern and the only way that this can be confirmed is if TSLA stock falls well below the $140 price level. Of course, if we see a zigzag forming, then we know TSLA will rise again after a crash.

This could end on an “E”  wave as well, so  a double bottom would also work. Stocks have an individual mind of their own sometimes,  so unless we hear about massive insider buying we don’t know where this will end. We have to see if a wave 3-4 develops or any counter rally that travels too far. 

With Elon Musk bunking at the Tesla Motors  production floor, “or as the story goes”, I am sure he will get the production ramped up. 

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Gold Intraday Crash Review.

GCM16-May-9-2016

Are we still in love with gold? Not according to the price crash it just took.  I am showing you a potential zigzag decline and if you have been following my commentary, three wave crashes can retrace their entire declines, specific to the degree we may think we are in. It usually takes one higher degree to get that done.

The “C” wave right now is not quite long enough to call it a great looking zigzag but the next few days should help clarify that. If gold is already on a 5 wave trip then we have much further to fall and no amount of support gibberish will help.

Five waves down would travel well below $1200 before we saw a 5th wave bottom, which I figure could take the rest of the month to do. Many things can run month to month, as gold clearly stopped in the beginning of May and started to crash. If we go way back to the first of April we can where the monthly gold run started from.

In the longer run, we still could be heading up a “D” wave, but not without a considerable correction. 

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WTI Crude OIL Intraday Crash Review

CLM16-May-9-2016

Crude oil crashed this morning, but it crashed in a rather sharp straight down type of a pattern. This is more a corrective move, then anything else. I will not put multiple alternatives in one chart as it is pretty common knowledge that there will always be alternates. Every post I make is always a new chart as all patterns get reviewed on a constant basis. One thing I can say is that the decline that started at the end of April is correct after all, so eventually crude oil will travel much higher but we have to put up with the corrections when they happen.  

Even oil can be in a diagonal bull market so we have to be aware of that as well. We are not anywhere near enough to a halfway point of this bullish run, but when we do get there we could be in for another ugly correction. The faster any move makes up, the uglier the correction can be.

I am working through a potential “ABC” that still may go sideways before another big drop. Oil only has less than $1 to move down.

If you have read news about the Fort McMurray fires we know that it is one of the biggest natural disasters in Canada at this time. Fire near the oil sands should not be a problem as all the plants have their own fire crews on standby. Any fire into the oil sands creates a cap and will not burn down like coal can do.

In the end 1 million barrels of crude oil production per day, have been taken off line or can’t be produced. It is the insurer’s  that will take the biggest hits and that is some of the banks that will be affected.

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Mini SP500 Intraday Review

ESM16-May-9-2016

I am looking at this SP500 as a potential corrective decline with another smaller correction in progress. There is very little room to move here so it won’t take very long for the markets to show us that they want to push higher. Gold sure has reacted to this and so has oil. If we were to progress down with these many  overlapping waves, we will  take forever to get anywhere.  If we are going into a longer sideways triangle type move, then it will also take more time. Right now the Mini SP500 can’t dip into the 2045 price level and it sure must not dip below, 2030. Short term I look at staying bullish but not for the long term as I feel the “big one”  is still to come.  

I can read all sorts of waves on this and even an Intermediate degree wave 2 top, so we have to wait and only take shorter time trades until this clears up a bit more. 

 

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Fort McMurray Fire

My friend and I were having breakfast at our favorite local “ABC” restaurant,  when he brought the fire news to my attention. I was already reading some news about it, but this fire is bigger than many think, and they are saying it can impact oilsands production and even the GDP. 

It will remain to be seen if this fire affects real estate prices across Canada, bursting the great Vancouver real estate bubble. Sometimes events like this can be so large and psychologically important that it marks certain time periods. 

 

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No wonder nobody wants to buy stocks, why should they as the SFD are rising 1.4% per month.

 

 

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Mini DJIA Intraday Rally Review

 

YMMY16-May-7-2016

Shortly after the employment reports came out the DJIA turned and started to rally. I guess that means all is well in the economy and stocks are going to soar!  If stocks are going to soar, then the HDGE ETF is going to implode, as it acts inversley to stocks.

I will talk about HDGE more below.

Apple barely moved so if there is no hope for Apple then there is no hope for the DJIA.  This decline is not a healthy impulse decline, as I am having to struggle with an impulse wave count. When this happens, I must assume the we are in some diagonal.

I have an “E” wave at the very top in Minor degree, but I think that is not going to last that long.

The problem with diagonals is that they can decline like this for a long time, driving us wave counters nuts. Sure, we had a sharp spike to the downside, but that one was pretty small for what I would like to see in a bigger reversal.

 

HDGE-May-7-2016

 

HDGE came to a screeching halt in the last days of April, before it turned and headed north while stocks headed south. This ETF will not react on a dime like futures will as futures are leveraged and act far more violently to news.  For stocks to continue in a big bull market, HDGE would have to implode and head closer to zero.  At $10, HDGE doesn’t seem it would have that far to fall and we could think that a major bottom is close at hand, until they inverse split it. If they did this 3 times, then this $10.75 ETF would be at $32.25 and then it would have much more room to keep falling.

I have seen this happen many times and no stock or ETF is immune to this. Any price getting to $5 and lower is a prime target  for inverse splitting.  With HDGE going vertical a correction should be due, and it is this correction that can help us determine if stocks are going to push much lower. I will be looking for an “ABC” type crash which will tell me that another leg up in HDGE is going to happen.  How far any move can go this time around remains to be seen, but after a correction I will turn more bearish on stocks.

The VIX has made a dip, but would head further south if stocks still have a bit of steam left in them.

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Gold Intraday Rally Review

GCY00-May-7-2016

Gold made a nice pop on Friday before it backed off for the weekend. Trading will start again Sunday night and that will be the test to see if gold and its potential wave 2 top will hold. I left the very top with a question market at this time as we still have many options we can explore. After all, if stocks go for a trip south, then shouldn’t gold fly as a safe haven asset? Well, not necessarily because the USD could become the safe haven ignoring gold and stocks.

The entire rally in gold could potentially be an a wave or wave one in some type of diagonal bull market, and if that is the case, then some type of a strong correction must show itself well before gold hits $1050.

In the end, we will not know unless we give it some time. In my time doing research I read an article on gold that was interesting.

http://www.horizontimes.com/facts/12-jaw-dropping-facts-gold

The gold/oil ratio is still very mild at just under 28:1 so when compared to gold oil is still very cheap.

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WTI Crude Oil Intraday Review

 

CLM16-May-7-2016

Crude oil peaked out with diagonal looking waves. At the peak I am using wave 3 in Minuette degree, so I must not use any bigger wave degrees than that until this so called correction is completed.  It sure looks like it that the next wave one has completed, which could be very true, but I want to eliminate any potential triangle first. In other words, when this run has finished, we just may be at the first “A” wave of a triangle. 

My first 5 waves took about 3 days. I need about 10 0f these types of up and down moves which would last 30 days in total. Many times they have very wild looking moves or even very straight ones, and would not form perfectly. This also changes the time for a triangle to complete

Again, this is one wave pattern I want to eliminate, and the only way to eliminate a wave pattern is by running until it busts. I still like to try to get a warning posted if I see it doing something else. 

Some say that oil will drop below $40 soon, but that is not much of a stretch as I see it. Anybody can forecast 10%-15% above or below any price and have a good chance of hitting it.

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