Tag Archives: Mini Sp500

Mini SP500 Intraday Rally Update!

 


 

The markets have started to correct, but for how long is arguable at this time.  I would love to see this wave structure finish and push south, but the fact remains, a diagonal wave structure could be starting so this market can still push much higher.  We need to see a small correction and then push higher again if the present bottom is going to hold for a little while longer.

Any bullish phase could head up forming a double top along the way as this market is trying to fool us again. Don’t get me wrong, this market can go south dramatically, but  that would be the easy thing to  expect. For this SP500 to leave us with a clear Cycle degree top, is just too simple or easy to accept at this time.

The small bullish move we’ve had in the last few days has to completely retrace itself, before it can be called a completed zigzag. My updates will be a bit short at times this week, as many other wave counts need attention as well.

For now we have to see if this rally has legs, but if it does not, then only a complete retracement of this move would be acceptable.

Hits: 6

Mini SP500 Intraday Update: Tired Of Playing the Nasdaq Game?

These futures contracts are far more violent than the SP500 index  charts that I have posted. It’s like they come from two different planets. In February we have two major bottoms, but when we switch to line type settings,  that wave 1 in Minor degree is much longer.

What must be obvious is that we have another lower high since the January peak and if we draw a line across this first lower high, we get a H&S pattern rolling over as well. Looking for lower highs too early in the game doesn’t always work, especially when we are dealing with a 4th wave.

As I post the markets are still heading down so my wave counts may have a longer life span at this time.

The Gold/SP500 ratio hit 2.0:1 which means it takes two gold ounces to buy one unit of the Mini Sp500.  I have many readings at this ratio, which tells me the markets are smashing up against a ratio brick wall. A cheap ratio would get closer to .75:1, so this ratio would have a long way to compress before we even get close when this market becomes oversold again.

I may switch to any ESY00 or even the SPY00 charts  more often to get a different perspective.

Hits: 7

Mini SP500 Intraday Bullish Phase Update

Is the stock rally running out of steam or is it going to soar to the moon with another super leg up?  Many experts say that this is just a healthy 10% correct and that this bull market will return and soar once again.

Blame Ontario Minimum Wage Hike for Canada Job Plunge. Or Not. – Bloomberg

The experts see no recession on the horizon in the US markets, but in Ontario, where they voted themselves a minimum pay increase  massive amounts of layoffs were announced. I doubt it very much that the USA will skirt a recession while Canadian fundamentals implode.

Fundamentals are lagging indicators, not leading indicators. It took 9 years for the fundamentals to change from horrible in late 2008 to great in early 2018. When the markets start to turn down again, you can bet that the experts will come up with all sorts of fundamental reasons why the markets are going down. The second deep plunge in February sure looks like a nice declining impulse, but in reality it counts out much better as a diagonal making it a potential 5th wave.

Today is also a new moon date, which in the past has produce some dramatic or very energetic reversals.  The February double bottom will never hold if the “Dip” so far, is actually just the start of the  “Big Dip” in Cycle degree.  The blame game will continue as they always need a scapegoat to blame stock market losses on. It’s never about stupid investors or stupid money managers that always get into a trap, but they will blame computer trading as part of the reason. The fact is behind every computer trade is a human with an itchy finger sending Algorithms crazy.

Below todays present prices, the protective “Sell stops” are piling up, and we don’t need any fancy computer to figure that out. Traders have been brainwashed to move protective stops up, which will easily get triggered once the “Big Dip” resumes. “Big Dip” I mean a Cycle degree 4th wave dip, not some pussy Minor degree correction that we are presently in.

They had a “Big Dip” from 1929 to 1932 as well, which was a Supercycle degree dip. That only took 3 years to play out. I’m sure any Cycle degree “dip” will not take any longer.  In the long run solar cycle #25 will put a screeching halt to any bearish wave counts or bearish fundamentals that we can dream up.  Solar Cycle #24 also destroyed all the bears by early 2009, so never underestimate the power of the sun on human affairs on earth.

The Gold/SP500 ratio has been hitting 2:1 on the expensive side from a (.75:1) ratio on the cheap side.  When the bearish mood returns, then this 2:1 ratio will never be exceeded for many years.

Hits: 1

Sp500 Intraday Rally Running Out Of Steam?

The SP500 created a double bottom in February before it rose in a violent fashion ending on the upside last week. At this time I’m going to count this as a 1-2 and then another 1-2 count, which would mean a longer wave 3 count. All we need is one more 1-2 wave structure to complete, then we would certainly be getting a long wave 3. It can all fall apart very quickly, but the main idea is to eliminate wave counts as soon as possible.

This great looking double bottom should not hold if we are over into the big bear market side already. ( The Big Dip) Fundamentals have not really changed, but that has always been the case as fundamentals are lagging indicators, not leading indicators. It took well over 8 years for those horrible fundamentals in 2009 to change to better fundamentals by 2018. At the extremes, fundamentals will always tell us the wrong things, just like they did in 1987, 2000, 2007 and now in early 2018.  Rate increases might be enough bad fundamentals to push this market down, but other fundamental reasons may appear at anytime.

EWI is also bragging that they they have hit the top, which they seemed to be pretty good at doing. Creating a great short trade setup can only benefit a very small percentage of traders, but they seemed to miss more bull markets than we can shake a stick at. Missing any major bull market is unacceptable as the older we get, the fewer bull markets we can afford to miss.

Steven Jon Kaplan started to call for a bull market back in late 2008 already, as the VIX peaked and insider buying reports were flooding the mainstream news sites.   This is when the stock bulls should have been screaming, “buy”,  but sadly enough all the wave analysts were bearish just like the majority were.

I’m sure this same setup will happen again and all the wave followers will miss another 8 year bull market. From 2009 to January 2018 the SP500 gained about 430%, which was only an Intermediate degree 5 wave run. The next bull market will be a 5 wave run in Primary degree, which I’m sure will give participants, 500% or more gains, in another 8 year bull market.

All the fancy wave counting in the world is pretty useless if we keep missing bull markets. We are still some time away from a real, meaningful bottom as a simple 10% correction will not do it. Even a 50% correction will not do it, as that would only suggest a move back to the average.

When solar cycle #25 arrives, then you no longer should be in any  bearish positions, as our sun makes or breaks all bull and bear market cycles.  The sun overrides the power of the wave counts at anytime, and it will be no different when solar cycle #25 starts.

Hits: 1

Mini SP500 Intraday Rally Update

I think our present little rally doesn’t have a very long life span as we just completed a potential expanded zigzag type of a move. Since diagonal wave structures can act about the same way, which should be ready for some hidden surprise moves as well.  In the last year or so I have developed a damn paranoia about markets, reversing and charging to new record highs. Once the entire January rally is retraced we might get a better feel if this market is already over on the bigger bearish side. It’s still better to catch a crash bottom that has turned into an “ABC” crash than not catch it at all.

I’m sure every wave analyst goes through the same situation. This is also a great reason to keep intraday wave counts at the smallest degree levels because it makes us more sensitive to the moves that are going on. We are now on the 5th day of a market meltdown, which many only think is a correction, so buying on the dips is being encouraged. Little do they know that this impending big correction will be the, ” The Mother Of All Dips”.

At every major top in 2000 and 2007, the analysts all mentioned buying on the dips, but these dips turned into Grand Canyon like gorges.

I’m looking for a Cycle degree correction and for a potential 3 waves in Primary degree I would need a specific wave count in order for the entire move to confirm itself.

I need 6 sets of 5 waves in Minor degree, 5 sets of “ABCs” in Minor degree and just one set of 5 waves in Intermediate degree.

Sure, we’ve seen all the fundamentals improve, which is expected in a big bullish price move, but 5th waves are always the weakest compared to wave 3 bullish phase of any bull market. From March 2009 the SP500 enjoyed a 430% gain, which only the true contrarians of this world can take advantage of.

The two major tops since 2000 are all wave three peaks that must be completed with a “higher” degree sequence. 2000 was an Intermediate degree wave 3 peak followed by a Primary degree, wave three peak in 2007 and now in late January,  we are faced with a wave 3 in Cycle degree. Sometime towards 2029, we could be faced with a Supercycle degree wave three peak.  Each 5 wave sequence leading up to any wave 3 peak must also be in sequence with the right degree.  The 5 waves up from the 2009 bottom were 5 waves in intermediate degree, so the next bull market must contain 5 waves up in Primary degree.

Flipping wave counts around like a line cook flips burgers is not an option. Most wave analysts refuse to go back to 1932 and start a fresh count,  as that sounds too much like work. Most wave analysts could not draw out an extended wave three because if they did, we sure would not be counting waves in SC or GSC degree.

The SP500 is resuming its downward trend as I post, so get ready for the wild ride to continue.

Hits: 2

SP500 Intraday Record High Bull Trap Update

Late last night the SP500 started to top out after achieving another record high at 2878. Every top could be the last top, but we never have insurances of that until it happens.  When the new trend slices through my bottom trend line by a wide margin, then we may have a correction bigger than what the majority expect. A deep dip past the 2650 price level would be a big help in locking in the new record high. Until that happens, we can always get a fast moving counter rally that would trash any bearish mood rather quickly.

What will happen is that this entire bull market that started in early 2009 will end, followed by a Cycle degree 4th wave bear market.

I have looked at 3-5 expert wave counts recently and they are about as bullish as they can make them. Building a wave count that is in sympathy with the crowd will never work. The markets will always do the opposite of what the herd thinks it’s supposed to do.  Since 2000 every major peak was followed by a crash.

It seems that the higher this market is going the higher degree levels they will start to make. This is the furthest from reality in what happens in extensions, as it is the smaller degree levels that come out from years of hiding. Look what happened after the 1987 stock market crash, which produced a Minor degree 5th wave extension, lasting 13 years. All the wave counting in the world will not help if  we are not prepared for what’s to come. It will be worse when this market does hit the next major bottom, because I’m sure wave analysts will be calling for the SP500 to fall to 500 or some other ridiculous number like SP500 300. Investors will be ill prepared if the SP500 stops at 700 or 750 and then soars to 3400 by 2029.

Contrarians do a far better job in reading the markets than any wave analysts can, so if they have tricks of the trade, then I want to use them as well. In late 2008 Steven Jon Kaplan was forecasting the biggest bull market since the depression, yet expert wave analysts were calling for a wave 1 in Primary degree at that time. A wave 1 bottom in Primary degree is about as bearish as a wave count, that we can ever have, so when it turned, wave followers were left holding a bag of wooden nickels. Nothing has changed as they are still pushing the unconfirmed SC and GSC degree wave counts. Make a few cosmetic changes, and they come up with a “New and Improved” wave count.  Sorry folks, but cosmetic wave counting never works because once it fails, we have to do it all over again, starting with the 1929 peak.

Sure, I practice some “Cosmetic wave counting”, at the intraday level, but for the last 5 years I have not had to change any of the three tops starting with 2000!

Hits: 0

SP500 Intraday Record High Update

All the 5 indices I cover, have been pushing to new record highs and has even formed a very small double top. In this market that little double top has no real importance as it can get exceeded by the time I finish posting.   There is no fundamental logic to all of this even when the government shuts down. The threat of a government shutdown has been going on for decades, and I have ignored all of them most of the time. It seems like the government is just showboating more than any real attempt to balance the books.

It is the changing of the FED that is more important, Trump Announces Jerome Powell as New Fed Chairman – The New York Times. I will keep working the Decenber move as a 4th wave, but wave 3-4 can be an “AB” move as well. At this stage of the game anything can happen. After 2 years with this 5th wave extension,  there have only been very small corrections, which cannot be maintained.  We need a big correction, and falling back to the December sideways move is the bare minimum we would need, if another super leg up were still to happen. In the long run the SP500 will crash or turn into a big bear market. The higher these markets go the bigger and deeper these markets will head down to.

Every contrarian, I respect knows what’s coming as they track fund flows and insider buying and selling. Some say not to worry about insider selling as they are just taking profits. What a pile of crap this logic is, as insiders don’t do the same thing as the public does. They buy and sell their own stocks because they understand the big picture of the business cycle very well.

Sure, this could go on an on for some time yet, but markets have a nasty habit of surprising as many participants as it can. Since 2000 we’ve had two major bear markets or crashes, and a third is on its way, yet the majority of participants are not any smarter. The fourth big peak may not happen until 2029 and the 5th one  could take until 2129.

Once the race for the lifeboats starts, there will be a panic situation when they realize there are not enough lifeboats available to get everybody out. They key is capital preservation and the majority has never been good at doing that.  Only the majority is dumb enough to invest in an extreme top, when the probabilities of a crash are more likely to happen.

Hits: 3

SP500 Intraday Record High Update

Yesterday the markets suffered a min type of a crash. It is also a move I like to see coming off another major peak. Due to its sharp decline, there is still the potential left for the markets to charge higher.  All of the January 2018 rally would have to get completely retraced just for openers,  followed by  retracing the entire December bull market as well.  We have to get a decline big enough for the markets to no longer have the time to create a new 2018 record high.

So far we topped off at the 2808 price peak and remains the number to beat in the near term future.

The Gold/SP500 ratio is well into the extreme side, sitting a bit over 2:1 this morning.

Hits: 7

Mini SP500 New World Records!

I normally take a break on any US or Canadian holiday, but occasionally I will break that rule. Soon we will be starting in the third year of a single 5th wave in Intermediate degree. At this time the markets show no signs that they want to slow down, but reversals can happen coming as a complete surprise to the majority.

We can’t have our noses stuck in the intraday level as we always have to look at daily and weekly charts on a regular basis. At the monthly chart scale we are dealing with a vertical move, where we can barely see any of the corrections above. On faster moves we can’t see any corrections on the bigger scale. Extensions happen all the time as they are a fact we can’t deny. Just because we have a single tall 5th wave, doesn’t mean we are jumping into higher degree levels.

We are still in the running to a Cycle degree wave 3 top, so until that happens, I will remain extremely bearish.

Tomorrow will be a new moon date, which can produce amazing reversals, when they feel like it. It could still take until the end of the month for this to play out, but I look at mid week times as potential turnings as well. The longer and higher this goes, just means it has much deeper to fall when the next bear market arrives.

Crude oil may crash along with the stock market, so we have to be aware of that potential situation as well.

Today the Gold/SP500 ratio is still around 2:1,  which it has been for 3 months. When a ratio is at an extreme and it seems to be stuck there, then I look at it as a warning for a major double top in the Gold/Sp500 ratio. In the end, we want to use less gold to buy a single unit of the SP500, which is close to,  (.75:1) Not until we get close to this cheap ratio again will the markets become oversold again.

Here’s what could trigger a 30% stock-market melt-up, says investor Bill Miller – MarketWatch

The markets breaking all these record highs are starting to bore me to no end! 🙄  Enough already! It sounds like the market analysts are stuck on repeat, or they are getting creative in calling for another melt-up.  It’s amazing how they can call higher and higher bull market targets when they didn’t even see the bull market coming back in 2009.

The higher calls mean nothing in the big picture as nobody knows what the markets will correct down to once those targets have been hit. Nobody is saying, ” Oh BTW, once SP500 reaches 2800, then expect a correction to 700″! Identifying bull and bear markets “after” they have turned means nothing in the big picture as the herd is always late getting in and late getting out.

Forecasting big price moves means the fundamentals are going to change as well. This is why, “fundamentals will always tell you the wrong things at the extremes”.

I’m sure that at the next bear market low, we will see dramatically different fundamental news come out, and I will be very surprised if we are not in a recession as well. I mean a recession, not a depression!  When all the analysts are in consensus agreement that a recession has arrived, it will be over. A new bull market will start again and eventually move 500%, not this boring 400% 5th wave move, we are presently in.

Hits: 1

SP500 Intraday World Record High Again!

 

For awhile the SP500 started going sideways  late last year, but has now charged up to new world record highs.  This morning we are staring at the highest peak of the SP500 in all its recorded history, and it still may not be at an end.  One good thing is that I like to see a well defined top, which can make it much easier to count down from, when it starts to happen.  Any new record high, can also turn into a potential turning point, which still could take this week to play out.

Employment reports come out on the first Friday of the month, so this still could send the market into a wild frenzy in both directions during this week.

We need some decent looking impulse like declines, because 5 waves point us towards a new direction. Any nice 5 wave decline will never last all that long, as it can turn into a zigzag very quickly.  We are witnessing a 5th wave extension alright, but remember, 5th waves are never that strong from a fundamental perspective.

The big goal is to find a permanent home for a Cycle degree wave 3 because without it, we can’t find the Cycle degree 4th wave bottom, and we would certainly not find the Cycle degree 5th wave peak as well.  The reason we are just approaching a potential wave 3 in Cycle degree is because the majority of wave analysts all are working from a 4th wave base, while all my work is done from a wave 2 base.

Working from a 4th wave base always puts us into a higher degree long before any wave structures have been confirmed. Working at degree levels too high, makes us very insensitive or prone to wait for the “big one”, when we should be fully loaded for the bull market to come. When our future wave counts are telling us more downside is to come, but insiders are buying their own stocks back, then that bearish wave count, has no chance in hell of ever being achieved. I’m not talking about any company share buy back program, which I see as a complete waste of shareholder money.

In the next day or two we could see another reversal, but until we see a single spike to the upside remain, anything can still happen in the short term.

Hits: 0

Mini Sp500 Intraday Record High And The Stampede Into Stocks

Five important reasons why a stampede into stocks may be just getting started – MarketWatch

A  stampede by any group or herd always suggests some type of panic is also involved.  What seems like a logical explanation is usually always an emotional decision.  The fear of being left behind is one of the main reasons why markets go up, it has nothing to do with reason or logic or fundamentals.  “Good News” must constantly be streamed, because what will happen once the good news stops coming?

Sure, this can keep going, but any new record high can also be the last one.  This morning the SP500 touched 2587  and may still add points for the rest of the day.

The VIX also crashed to a $9 low, but has a small gap to close off,  before it can soar higher. Record complacency as investors see no fear from any  large degree market correction. Any potential recession is hardly on the radar screens, but there are some that just love to push the idea of an impending depression.

If you look at the charts of the last great depression, the markets started on a major bullish phase right after the 1932 bottom. If the history books never told you about the depression, then the stock charts would not give you a clue that a depression ever happened. Harry Dent has come up with a DJIA 5000 price forecast and when we calculate that bottom for a time period, we come up with 1996!

In 1996 the sun was ending solar cycle #22 and about to start solar cycle #23, which gave support to all other USA based indices. In the next few years, solar cycle #24 will end, and solar cycle #25 will start,  just like the sun has done many times before. Each solar cycle bottom was followed by a bull market in stocks, so by 2021 the so called next, “great depression”  better be starting to wrap up, because solar cycle #25 will produce a minimum of a 5 year bull market or even 8 years.

So far solar cycle #24 has produced well over a 8 year bull market. The short version is that, “Any” bearish mood, including “all” bearish wave counts will get crushed, once  solar cycle #25 starts to crank up.

Hits: 1

Mini SP500 Intraday Review

The markets are struggling trying to decide which way they want to go. At this intraday scale we are barley off historical record highs, so it is understandable why the markets are not picking a clear direction just yet. We have a huge open gap just above present prices, which should get closed off, before the Sp500 can resume any bigger bearish trend. 2481 would be the magic number to beat to create a new record high. 

The violent moves the markets can make, would make a new dash to record highs child’s play. To help make the bearish case the SP500 would have to retrace the entire August rally, and then keep going. Every support range we can come up with, will get broken to the downside, because everybody is only expecting a small correction. Some say a 5% correction and then back to the stock party.  A 5% bear market will be no worse than a bee trying to sting a bear through its’ thick layer of fur.  

For a new record high bull market to still be in our future, the markets have to establish a very bearish base first. Besides the markets have one major ingredient missing, and that is insider buying. The insiders who are the contrarians have already left the “Building”,  (May, 2017) and until they come back in large groups, this market is in no man’s land, or some kind of la la land. 

The VIX also has a huge gap that needs to get closed off, so this also helps to keep the bullish scenario alive a little longer. The DOW and the Nasdaq also have a gap that needs to get closed. Either way, if these gaps are left open, then we know that in the future those open gaps will become a price target that the markets will strive for. 

Hits: 2

Mini SP500 Intraday Record High Review

The markets have been hitting new record highs on a consistent basis.  In the last day or so the SP500 created another record high, consisting of choppy waves that can only fit into a diagonal type of a wave. We are dealing with very small waves from a degree perspective which I show as a Minuette degree. The markets could be fooling us with what may be an expanded pattern, and it’s the main reason for showing a “B” wave in Intermediate degree 

The potential of an inverted zigzag traveling to new record highs, is pretty common with diagonal wave structures. The fact that “any” inverted zigzag can retrace 100% of its entire move, is one of the best indicators of future direction that the EWP can give us. Needless to say, they are very important from my perspective. 

When we count everything by only seeing impulse waves, we rarely will spot expanded wave tops. 

Will this market break and set another new record high? It sure can, and in the next few days this may get cleared up. I have already looked at the Apple chart as an expanded pattern, and I may find more in the coming weeks.  We have to find a real top that is followed by a 5 wave declining pattern. This real top is not defined just yet, as a new shot to record highs can still happen very quickly. 

The VIX is also rolling around a big 23 year triple bottom at the 9.50 price level, so that indicates that fear can strike the complacent investors at any time. 

Short term we are still getting bullish action, but longer term this insane market is going down. If all the contrarian indicators are being ignored, like they usually do, then many of the investors will see that that the fingers will be pointing at them as being the “greatest fool”. 

Remember, as the market rises, all protective sell stops start to pile up below present prices, so any wild bearish news can start to trigger the majority of  these sell stops.  Besides, I think there are specialist that just love to trigger any stops at all.  

 

Hits: 3

Mini SP500 Intraday Record High Review

This E-Mini SP500 is so close to breaking new records, that it still has a good chance of breaking through by the end of the day. I have a small zigzag trying to push through, which would be part of a bigger 5 wave diagonal move.  What might not be so obvious, is that oil seems to be fluctuating up and down with the SP500 at these intraday price levels. It’s not very consistent, as we can also get stock declines when oil does nothing.  I will discuss this scenario with my contrarian friend, but it would have to do it on a much bigger scale, if there is any basis for  real concern. 

I think this correlation is a short term thing, and can smooth out or even disappear altogether.  I don’t notice this pattern standing out on any of the other indices, so this is also a good sign it may not keep doing it. 

It’s always good to take a Gold/SP500 calculation, when we see extremes, and this morning it took exactly 2 gold  Troy ounces, to buy one unit of the SP500.  I recorded this 2:1 ratio in December 2016 as well, but I have to do some more back checking to see what the ratio was when the SP500 was cheap. In November 2016  it only took, .75 ounces to buy one unit of the SP500.  

When gold is pointing down, and stocks are pointing up, then this is usually a setup for a reversal. I’m sure we will run into this scenario again in the future, and even now gold could soar, while stocks take a beating.  

As I post this SP500 is soaring  to new highs, so it may back off when we get closer to the end of the day.

Hits: 2

Mini SP500 Intraday Gyrations Review

We have some very ugly waves that have formed, from the June 19th top. A 4th wave can still be in progress, but it also could be  the start of a diagonal decline.   There may be one more Micro degree 5th wave this week, and it could stop with another small double top.  When we draw a trend line from this June top, then the 2436 price level could supply the SP500 with resistance.  The maximum of this diagonal 4th wave would be around the 2444  price level.   This tight range does not give us any room to wiggle around, but it also supplies the pointer to a potential wave 1-2, which is extremely important. 

One thing about diagonal 4th waves, is that they  “must not”, exceed the wave 2 spike I’m showing.  Many times they stop in the middle of wave 2, and then they reverse, and soar the opposite way.  Oil has  been going up and down in sympathy with the SP500, but oil has also moved ignoring, the SP500. As I post the SP500 and oil are still soaring together.

 Short term I would like to see the SP500 move higher, but after that it will be a crap shoot, if the markets soar to new record highs or not. 

Many mainstream  media news shows that the majority are also conflicted in the future trend of the markets.  It can all smooth out some when another “C” wave follows any potential B3 wave as that would be very common. Diagonals do not look that much different than what a correction will do, so transforming to a choppy decline can make us think that just another bull market correction is in progress.  

Hits: 3

E-Mini SP500 Intraday Rally Review

I’ve made a few changes in the wave count, after the SP500 landed were close to my last bottom. Due to the positive jobs report that comes out on the First Friday of every month the markets soared. This good  fundamental news trapped all the bears, triggering the protective buy stop orders in the process.  If this means anything, then technically, the SP500 should keep right on soaring to new record highs.  The full moon is on Saturday, so even that can make stocks very bullish.

Our last extreme high was back in mid June as it crossed to new records,  with a 3 wave pattern. This is a typical diagonal wave structure that I love to see.  Since the June top, which could be the start of a bear market, the market has made one crazy decline that was so choppy, that it can work as just another correction.

The market is still charging up as I post, but if this rally has no teeth, then another new low would happen. Any new lows, will prove that the markets don’t care about any fundamentals.

Any decline has started  with diagonal wave structures, as it is next to impossible to fine great impulse waves, except for runs of very small degree levels.  A new low must be reached if the bigger bearish phase has already kicked in.  The violent swings are typical when a market changes its direction and the best we can do is to wait until a newer low gets confirmed.

The DJIA and the Nasdaq had also seen their extreme highs, but with tops at different times.  The best we can hope for is that we don’t end up with multiple tops.  It would be nice if we can see a clear price peak structure that  we can start our count from, but that sure can be wishful thinking on my part. 

When the markets don’t make new highs continuously, then all those emotional traders will see they are no longer making gains, and buyers will stay away, or existing bulls will be eager to sell.

Insiders have long sold out with this May being a very heavy month for insider selling. 

 

Hits: 0

E-Mini SP500 Gyrations Review

Yesterday, the SP500 hit a crash bottom, and then reversed its direction and charge right back up where it once came from. This was a little too far for my liking, so I looked at my daily chart to find the peak, to the start of what could be a triangle.  I’m sure you know about the potential “Thrust” the 5th wave could make.

What is different is that we are in a much bigger diagonal, where the 5th wave itself can be another zigzag. Another zigzag to new record highs would then happen. The first zigzag sure looks like a flat, but the “D” wave could not be a better formed zigzag, pushing the SP500 to new record highs. 

If we look at the triangle as a whole, we can see that each zigzag in one direction, was completely retraced by a zigzag in the opposite direction.  Following the potential “D”wave top, the markets plunged into what looks like another zigzag crash, which I labelled as an “E” wave. 

This “E” wave has not been completely retraced, and I think it should still happen, as we were only 10 points or so away, from breaking a new record high this morning.  If the bulls are still in control, then the top trend line will not hold, as this present correction should find a bottom, and then reverse.  This mornings plunge was very steep, further making the case for a correction. 

Even if  this chart heads to a new low, we could also be in a “D” wave, as the entire triangle could be one wave too early.  I would love to see this as a triangle, because it can give us more certainty, that a much bigger correction is still to come.  

The new baseline is at the 2412 price level, which can get breached, but still soar back with a vengeance.  The SP500 is now getting close to breaking support, so we have to see what happens during the rest of the day.

Hits: 2

E-Mini SP500 Intraday Crash Review With VIX Commentary

Keeping an eye on the VIX helps to confirm that fear is being injected back into the stock markets. So far all bottom open gaps,  have been closed off. Also, no gaps have opened for the start of this VIX rally, which also is a very good sign.  At least the threat of an instant VIX crash is reduced, but corrections can happen after every vertical move. 

The big VIX, is the ” Mother Of All Diagonal wave structures”, so any VIX wave counts, will overlap in many of the critical waves.

 I reworked the entire May and June rally to the 19th of June peak as diagonal “C” wave. This has  ended with another 3 wave move to record highs.  This record finished with a 2452 price peak,  and is now hell bent on going south like geese in the winter.

 

 

That’s what it looks like, but I would like to see more, so there is no hope for this stock market to add on another leg to another record high.

 

I have mentioned it many times that any new record high could also be the last record high, but that would also be the last high for this year. At the 2415 price level  the SP500 would hit the line in the sand, but this bottom could be more like quicksand. Wild counter rallies should always be expected, as the speculators are still in a bear trap. 

It is very important to understand that any 3 wave move to new highs can be just part of a bigger diagonal or even an ending triangle. Even though I came close to exhausting my wave count options, there is sill a wild card left of another potential big 3 wave move to the upside.  The odds of that happening would be reduced as soon as the SP500 slips well below that 2415 price level.

Hits: 1

Mini SP500 Down To The Wire Intraday Review

From the May 18 bottom this SP500 index just soared and is now just short of breaking to new record highs. Hopefully by the end of this week, this will all get cleared up. Not much I can report this morning until this potential bearish rally implodes. Those words may sound a bit harsh, but all the other indices are also on the borderline, of an upside breakout. 

The crash of the VIX has now closed the Mother Of All Gaps, so it can be ready to rally as there are open gaps above present VIX prices that need filling. 

Hits: 2

Mini SP500 Rocket Rally Review And VIX Review

 

It is a good idea to look at the VIX first, before we look at the SP500. The MOAG, (Mother Of All Gaps) 🙂  Has opened up in this VIX chart which means that investors were really worried about the political events in France, but a wave of calm returned instantly.  Will this gap get closed off?  Of course it will, and when that happens, we know fear will be returning  in the stock markets.  With this gap it would be futile to look for a very bullish wave count in the SP500.

 

The SP500 has created a different wave count than the DJIA, as the SP500 did not manage to establish new record lows. All charts I follow produced gaps early this morning. We can also safely assume that all these gaps will get filled or closed off again.  We have a very ugly “C” wave that started last week, that may be lacking one more bullish set of small waves.  The Nasdaq broke to new record highs, but I think the odds are that flipping Heads or Tails with a coin, would decide if this Sp500 follows to new record highs. 

Hits: 2

Mini SP500 Intraday Bearish Progress Update.

 

There is not that much to get excited about these moves as they seem to be working at a snails pace. When that happens usually there is something wrong with the wave count.  Only one of the two lines I show, is a trend line as the other shows a triple bottom H&S pattern.  At major tops, H&S patterns are bearish signals, so I sure would not bet on this pattern to hold support for the 4th time. 

I believe that the entire inverted flat I show has to be completely retraced, before we get another strong bull attack as a wave 2 in Minor degree.  For now this wave count can still work, but I will kick in an alternate if I have to. Many patterns, travel month to month, so by the end of April, we might be able to find a better fit. 

Even the smallest counter rally can send shock waves into the hearts of  the bear riders, as there are plenty of traders that love to short the markets. With any Futures or Forex accounts you can bet short just as easily as you can bet long. Timing is everything  as participants would be crazy to stay in a direction that is going against them. They are not like the majority who are brainwashed to stay for the long haul, who will take huge losses before they get off the bear bandwagon.

Even though it may seem to be slow from my perspective, and diagonal 5th wave or “C” wave decline can produce dramatic swings, that few people expect.  This keeps all options wide open as to where the next bottom support level may be. One thing is that the entire Trump Bump,  should get completely retraced, so if you find the start of this bullish phase, you will end up with a price target, that needs to get hit. 

From my perspective Cycle degree wave III may have completed already, so the  impending correction is not going to be some small little speed bump, before it carries on for another super leg up. 

Not until we see a major bottom will we get another major bullish cycle. The template for that bull market has already been published a long time ago, yet not a single wave counter has been able to fill it out correctly, even after I tell them it is a Cycle degree correction.   

I remain bearish in the short term and long term as well, until such a time when the majority becomes extremely bearish. 

Hits: 2

Mini SP500 St Patrick’s Day Review

 

I have changed my degree levels where Minute degree will be the largest the level right now. The DJIA has also made the move up in the last couple of days, but had a “B” wave bottom much deeper.  What matters now is that the markets don’t charge up to a new record high again, but starts to make another leg down. This leg should retrace all March lows by a wide margin. 

Yes, I talk about price many times, but from my perspective, the price is never the main factor in determining a wave count. The majority uses price action, exclusively and even EWI has said that, “the only thing that can confirm a wave count is price”. I believe it is the patterns that dominates, and if we don’t get the pattern right then all the price forecasts in the world will not do us any good.

In the short term, I would like to see the SP500 retrace its tiny rally as soon as possible, which will give us the extra bearish push,  to start confirming that a bigger bear market is coming.

In a recent posting by Steven Jon Kaplan  , he talks about the impending SP500 bear market with some price targets. The description he uses fits into my Cycle degree bear market with amazing accuracy, and I would not change a thing except for a bit of time and price adjustments. 

If the SP500 eventually crashed to 800 then that would fall far short of the 2009 bottom. I have mentioned that this could happen many times before, even in Cycle degree.  For a non wave counting contrarian Mr. Kaplan has already described the next bear market, before anyone even knows what’s going on. 

If you think this is luck, then think again, as I have witnessed him forecasting like this many times before. Mr Kaplan had the 2009 bottom figured out while wave analysts were still wasting their time making numbers and letters.  My bet is that the next major bottom the wave experts will be wrong again, as they seemed to love pushing those high degree wave counts at us.

Any, time projections I used,  can be adjusted for the late 2020 time period, and price action can be, SP500 799,  instead of 800!  It is irrelevant if the SP500 stops at 800 or 599, as a lower price does not trash a wave count.  By the time that happens there will be so many contrarian indicators flashing, “Buy”, signals that you will go blind from all the bright lights. 😎

Hits: 0

Mini Sp500 Intraday Rocket Ride To 2400!

 

 

I think a rocket ride may too much of an understatement, as it looks more like a fighter pilot ejecting from his cockpit. These are the types of moves that are characteristic when a blow-off is near. This vertical move cannot be maintained and a correction must happen. The problem is it can also be the end of  the wild and woolly bull market, that started back at the 2009 stock bottom.  All analysts called this a big bear market rally as they were convinced due to the choppy nature,  that the markets would implode again at any time.  

What took some time to figure out, is that the entire 2009 and now 2017 rally was just a diagonal pattern where everything joins together in a zigzag fashion.  When I see an impulse wave count applied to diagonal patterns, then we are missing the boat.  Diagonal waves are one of the best waves to identify a 5th wave or a “C” wave.  I believe the entire Trump rally can work as just another zigzag, but a big long Minute degree, zigzag.  The 5th wave of this zigzag should also be a 3 wave pattern. Just because we had a big long accent does not mean we must instantly switch to a much higher degree.

In any extension,  it is the smaller degree levels that come out of hiding not the big degree ones.

This sure puts the markets into a bubble mania setting at historic heights. (SP500 2400) Historic records broken on the way up, can create new records on the way down.   Cycle degree wave III is still very much a reality and I have discussed the three simple corrective probabilities many times already.

The only thing that needs to happen is have time work its miracle.  I must admit this top has been far more difficult  to get, than  2000, 2007 and 2010 was. But it is good experience, due to the amount of diagonal waves we have had.  2010 was the flash crash which I started to document in detail a few months ahead of time. 

During all of February the VIX has not created a new record low, which I think is an excellent bullish  sign for the VIX, but a bearish sign for the markets. 

Hits: 1

SP500 Daily Chart Review

 

 

This is the Mini sp500 cash chart which does not move during off hours. It can also produce different wave counts just by breaking higher or lower on certain wave positions. I am confident at this time that the 2015  panic dip was a correction, and that all of 2017 and the start of 2017 was a 5th wave in Intermediate degree.   I try to keep most of my lines in parallel based on the bottom line, and we can see the SP500 touching the top trend line already. 

The entire bull market that started in March 2009  will only work as a diagonal wave, which makes this last 5th wave look so damn ugly.  I counted it out this time as just another impulse wave count, and chances are good I will change it again.  The  wave pattern for the last few months sure fits very well into an ending diagonal, but short term we know this market will keep the majority of us guessing.   The markets started to head south this morning, and some are waiting for Yellen to launch a surprise. 

Bond traders fear, Janet Yellen is planning a ‘St. Valentine’s Day Massacre’.  Only time will tell what can set traders of in a panic, but fear of higher rates could do it.  All this time the VIX still has not broken to new lows which is a good thing as it gives a good indication that the VIX decline may hold. 

Hits: 2

Mini SP500 Intraday Gyrations Review

 

esz16-nov-1-2016

 

I try not to use wedge like trend lines as I think they are abused, but on occasion I use them to draw a line in the sand. It seems that many just love to draw all the wedges they see and then add a few more lines to impress us. Folks, any first year chartist can draw wedge lines, and I bet any 12 year old can too, once they know what to look for. It’s not Elliott Wave rocket science to see a trend in the charts, but what is different is when that trend will change and soar the opposite way.

Which trend line will get hit first?  Yes, I have a very bearish wave count, but this week and next week can be so wild that   the stock bears can get into a trap so easily, forcing a massive reversal. It may only last for a short time, or until the election is finalized. 

When the bottom trend line gets hit, then I simply turn the bottom trend line down, until it is parallel to the top. Keeping trend lines in parallel, as they work double duty, for impulse and corrective moves. 

In this case Cycle degree is behind us, but that may not be a permanent thing, until this bear market advances any more. If it keeps going we know, that we are in a potential diagonal due to the choppy nature of this pattern.  Gold has reacted in a positive way, so that keeps the “run to safety” theory alive for the time being. 

Any bigger bear market has to go much longer and deeper down the charts, so hang on as the wind coming from the NW is picking up speed. 

 

Hits: 2