Friday 27 April 2012

Closing Brief

I'm glad that's over with. Just a quick closing update on those hourly cycles. The SP' almost showing a sign it was going to close under the 10MA..but no. The VIX did manage a slight break higher over the 10MA, as it has now also moved to a positive cycle on the MACD.




I would to think the bulls are almost as surprised at the strength of this post Monday low up-cycle, as the bears are. Is it a fifth, of a C..of a giant bear flag - as seen on the daily charts? Right now, its time to stop...its the weekend.

As usual, I will post updates for both the weekly and monthly index cycles across the weekend, and maybe a few other things too.

Have a good weekend

3pm update - One hour of Crazy left to go

Thank the gods, its almost time to wrap up this pretty disturbing week. I was just updating all the weekly charts (I'll post them later this evening- as part of the weekend coverage), and those weekly charts sure look ugly from the bearish perspective. We even have a few bullish engulfing candles, and those are often a major warning that a new up cycle is beginning.


The VIX is again falling to pieces, looks like VIX will fail to close above the 10MA on the weekly, so that's yet another failure for the bears.

Its almost time to get some tea/coffee, and say farewell to another bizarre market week, in what remains a pretty sick and deluded market*

*AMZN results were a failed mess -this is of course not the general opinion. Mr Market, and those clown channel hosts/cheerleaders were thoroughly delighted with AMZN! I'll delve deep into AMZN at the weekend on the Fair Value Stocks page.

2pm - another hour of pain

Well, there go the 1405 short-stops. Reflecting back to Monday, this week has been a complete disaster for the bears. All that initial excitement Monday morning, a complete reversal...and its still going.

Sp'60min - count'2


*the SP' count'2 is based on a few variations posted over a week ago. There were a few people this past Monday who had suggested it was merely the B' wave low..and that a strong C' wave up was due to break above 1400. I can only imagine how pleased they are this Friday afternoon. 

For the rest though, is it essentially total failure this week, and it now looks like a close above the big SP'1400 level is assured. Baring a truly severe turn around on Monday, both the weekly and monthly cycles are now back within their October'2011 up trend/channels, and April will close out still bullish.

A rough day...a rough week. I'm glad there are just two hours left.

1pm update - did the bell ring yet?

3 hours left in this trading week, I'm almost wishing we'd just close now, since the chance of even a slightly red close seems out of reach.



VIX trying...yet again to break back above the hourly 10MA. The 10MA on the weekly cycle is currently 16.65, a close above that remains essential to any bearish outlook into early May.

Arguably, the big-short money won't be thrown into the market until we are back under SP'1380. Right now, a 23pt decline in the SP - even across 2-3 days next week, seems like a wistful hope.

More later, on what remains a difficult day for those holding short positions.

12pm update - Frustrating Friday

Today is starting to get real frustrating. Lousy econ-data, the Spanish downgrade to 'semi-dirt', and here we are still holding over SP'1400. Is the Bernanke whacking the giant red 'BUY' button on his desk today?



Not much to add, its time for lunch, and as it is, it doesn't look promising for even moderate sell-side action this afternoon.

Bears need (as I've been saying since early Wednesday) to break below the 10MA, now 1397
All the bulls need is a mere flat close, around 1400, that would suffice, and will almost guarantee that both the weekly and monthly cycles remain broadly bullish as April concludes next Monday.

The most disturbing thing of all, we're now only 20 SP' points away from breaking a new high.

I'm getting real tired of this..again. Sigh.

11am update - Battling it out

Yesterday we arguably saw most of the last short-stop levels taken out. There really can't be that many bears left for the algo-bots to kick out. It sure looks like they are battling it out this morning. The bulls are trying to stay above sp'1400/dow 13k, whilst the bears are desperate to at least close today marginally red. Perhaps we can see more heavier volume as the day progresses.

Whilst the market currently churns with only moderate moves up and down, lets look at the daily cycle outlooks.

SP, daily - bearish outlook

SP' daily - bullish outlook


There is no question about it, right now, the bulls ARE in control, but they are at a level where it could quickly fall to pieces. The bearish H/S chart noted above is pretty interesting, and we'll know soon enough if its just another failed outlook.

The bullish outlook indeed seeks at least a moderately higher high above 1422, although it does not necessarily have to be too much. I see plenty of good chartists out there suggesting sp'1450/60/70 as the peak in the next few weeks.

It remains a tricky situation, at what is a very key battle zone of SP'1400..

For the 'serious money', bears short-stop level would be 1405/10...and the bulls 1395/90.

More later...

10am update - will the pain stop soon?

Well we're off and running. I'm going to focus on IWM a little more today, since that is what I personally often trade in anyway. I've a few new charts to post on the Rus'2000 index as we progress through the day.

Opening action looks somewhat weak, but its certainly not to be trusted right now. We've seen plenty of moderate morning declines that flip positive later in the day. IWM's opening minor move higher quickly became a black candle - often a good warning, and within minutes it has indeed turned impressively red.





A very long day ahead, and bears will clearly be desperate for a close at least 0.5% lower across the main indexes. Considering the GDP data, the Spanish downgrade, and end of week 'I don't want to risk holding across the weekend', you'd think we might actually close red today.

More throughout the day!

Pre-Market Brief - GDP disappointment

Good morning, Q1 GDP data came in at 2.2% compared to the consensus expectation of 2.5%. Market is somewhat disappointed, and the 0.25% gains in futures are back to flat.We have a long day ahead. Considering the Spanish downgrade after hours yesterday, it is again somewhat annoying to see the market still recover all the of overnight losses in the futures.


From a MACD cycle perspective, we sure are due a move lower. Presently we have what is a double-up cycle, I've seen plenty of triple cycles in the past few years, so its still viable we go up later today - even if the morning is somewhat lower.

Considering the weak GDP number, its time for the bears to stop this nonsense up-wave!

Good wishes for Friday trading...we now have just 2 trading days left of April!

WTIC - stair stepping upwards

WTIC (West Texas Intermediate Crude) Oil continues to stair step upwards. All the talk of USA increasing drilling is so far amounting to nothing with respect to lower prices.

WTIC, weekly, 5yr

WTIC, monthly, 20yr, historic


It is amazing to look at the twenty year chart for Oil. There sure have been some crazy swings along the way, but the broad trend remains UP. Aside from those who believe in Abiotic oil 'magically appearing in the Earths Crust', Peak Oil is a serious and critical resource problem for the world in the decades ahead.

Considering that 'everything' is supposedly okay right now, the economy is growing - although not that much, and yet Oil prices are still very much holding over $100.

There is also always the threat of 'an event' in the middle east, and across the years ahead, that does seem likely. Whether it is next month, or in 2020, it really doesn't matter in the scheme of things. What does matter is that Oil prices look set to hit much higher levels in the years ahead.

Looking for a break above $115

From a technical/chart perspective, Oil bulls need to see a few consecutive closes over the May'2011 high of $114.83. If we see WTIC hit $115..and hold over, then a re-test of the 2008 commodity peak high of $147 seems very probable.

Were an 'event' to occur...there seems pretty much an agreed outlook that Oil would jump overnight by many tens of dollars, maybe even a direct gap right over $147...and then quickly to $200+. For the world economy, the consequences of such a price, are of course the stuff of nightmares...and 'doomer' movies.
Goodnight from London

NYSE - very uncertain outlook

The NYSE Composite index, weekly and monthly cycles are at a very critical level. A touch higher, and we'll spiral upward, a touch lower...and we could fall a long way across the summer.

NYSE Comp, weekly

NYSE Comp, monthly - bullish outlook


First, the weekly cycle - which from a cycle perspective, has been falling for some 3 months. We did have a very clear break lower 3 weeks ago, and are presently at the important 10MA of 8100.  A back test of the broken trend line could be as high as 8400 - which would interestingly be a new high, and would match up with SP' 1430/40.

The monthly cycle remains bullish, and despite the past few weeks to the downside, we are very much looking to continue what remains a strong up trend since last October. A break over 8330 on the monthly would be very bullish, and open up a target to as high as 10000 later this year - forming a double top from late 2007 ?

Conversely, a break under 7800 would confirm the recent market weakness, and arguably confirm 'great problems' this summer, something in the region equivalent to SP'1150/00.