Video Update for Friday...
Red
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or just a relief bounce...
After selling off for 4 days straight, the market needed a breather, and that's exactly what we got today. Â As for tomorrow, as long as the initial claims and continuing claims numbers meet or beat expectations, the market should go a little higher.
I'm not saying that it will for sure, but it's likely to push up some as the 60 minute chart is in rally mode now. Â The 107 spy area is the likely target, where it will find resistance again from the larger falling channel. Â If it makes it back up there, then I expect that area to stop the rally and then continue the selling next week (and possibly Friday too?).
The GDP number on Friday could be a non-event, and then the market would just trade sideways to up a little. Â But, if it's really bad, then we could see a huge sell off on Friday. Â There is no way to tell right now, but the trend is still down. Â We just have to wait out this relief rally for a few days.
So, if you are short, just be prepared for a small bear shakeout before another leg down occurs. Â There is still nothing bullish in these charts, but the market has come down pretty far and pretty quickly. Â So, a bounce is to be expected. Â It could last just for tomorrow, or a few more days? Â There is no way to tell just yet, but I don't think it will last into next week.
Good luck to all the bulls and bears out there...
Red
I enjoyed your analysis. 1070 or not…we're going down.
Thanks… I try. 🙂
I enjoy your commentary and look forward to your analysis on Utube.
Thanks
The stock indices have a similarity to the days leading up to the flash crash in regards to its bollinger bands They have hit their lower downtrending BBs and are starting to hug them. The last two days action are mimicking the May 4, 5th days as the BBs are just starting to widen. This is the start of a new move and it appears that a counter -trend rally can begin from this formation. Even if there isn't a crash tomorrow, the indices should continue to hug the decling BBs. Only a complete close inside the BBs would be the first sign of a new rally. And this brings me back to the trader with a great track record the last few months. He waits for a bubble to form with the widening BBs and then waits for the BBs to contract with the indices down at BBs before he takes a counter-trend trade (from what I gather). The BBs are just now starting to widen. I also went back to the 1987 crash, and the market started its crash leg in a similar position. (basically after 2 piercings beneath a downtrending lower BB). Its hard to believe a crash can occur with such a high Mc Summation reading but it happened with the flash crash on May 6. Oil and the currencies are just approaching their lower BBs although the currencies haven't really tagged them yet. Euro is currently doing well in afterhours which would have a positive effect on the markets tomorrow but that could change by the morning.
I meant it is unlikely a counter-trend rally can begin with the indices just now starting to tag their downtrending BBs. Maurice Walker has a BB chart on page 3 of his charts………I also went back and checked the Sept 2001 waterfall decline and the SP put up a similar bar on Sept 10. August 26 is also an equidistant 56 days to July 1 low with May 6 flash crash day. (I liked the Aug. 25 numerology better). It also 66 cds from the Summer Solstice high on June 21. July 1 was 66 cds from the April 26 high. And of course it is a major Tdate although T Theory Guru is supposedly disavowing it now. (although as a high) A new 13 day cycle also might come into play tomorrow although it originally was a low cycle (that connects back to May 6) but the last cycle was the August 9 high.
2 other DOW 30’s BA,UTX—If there’s a a price channel change there, I can’t see it.
go long at their last lows, looks to be worth trying.
Dow Jones futures before opening bell
http://niftychartsandpatterns.blogspot.com/2010…
Lots of overhead resistance San. So even if the market can get back in that falling wedge, I don't think it can hold it too long.
Trend is clearly down. If key levels are not taken out by the bulls this will be another sell on rally.
But we have to wait and see if the rally happens
Closed the rest of my DRN position around 42. (bought at 38.32)
Currently long oil via UCO
Anna went long yesterday too Dreadwin, so that was a good call. I'm sure she'll be looking to close out those longs today as well, as I can't see this rally lasting into tomorrow.
I think everyone is scared of the GDP number. The max I expected from DRN on this move is to go from 38 to 42.80. I feel like I've captured most of that move, and now will look for other trades.
Smart move Dreadwin… you are a smart trader.
Thanks! To make it in this market recently, one has to be completely disciplined and pragmatic. I think that the REITs are a smoking ruin of fail, but I will happily take that trade if I can make money on it.
Closed em all at open cept one
😀
You going short again now?
yes 🙂
I closed my long oil position (UCO), too. I'm looking to go short on a bounce.
I don't blame you. The vix is putting in a bull flag, gs is still falling from the morning high, aapl is putting a bear flag, and xom is struggling too… with a topping tail on the current candle.
I entered into the UCO trade after-hours yesterday (8.63). The rationale was that oil makes a large part of it's move in after-hours. As oil kept going up, I kept increasing my stop and finally got taken out at 8.88 (+3%). It was supposed to be a low-risk trade, so I wasn't going to push it.
3 % improvement initial claims from a very bad level and the market is euphoric??
It was more based on the technicals Jim, as the market just needed a reason to bounce. Let's see if they can continue all day with GDP out tomorrow… LOL
Buyers do not appear to be jumping in?? I was going to wait till above 1062 to add to shorts.
Yeah, and the 60, 15, and 5 minute charts don't have a lot of room to go on the upside before rolling back down. I really can't see this lasting into tomorrow either Jim.
GS looks like it's got an inverted H&S on the 10 minute chart. If it plays out, it could help rally the market. However, the vix is falling and is almost at gap fill, which should give it support. Apple has filled it's gap and is stuck there.
Basically, the market could breakout to the upside… or fail and come back down. However, it's running out of time as the 60 and 15 minute charts are going into overbought territory now.
It's hard to say what's going to happen at this point? I just don't think it will have enough juice to breakout today. Maybe tomorrow if the GDP numbers come in good? Who knows?
Something just turned it down??
Yep… rally no more! LOL
GS, XOM, and AAPL are falling too gang. Looks like the rally might have ended?
break 1050 and we fall hard
I take it you are short now…
S&P 500 Trading near support area
http://niftychartsandpatterns.blogspot.com/2010…
Vix is not supporting any direction at the moment. Hard to say where we go now.
Yes, volume is also light now… which usually means the market will have an upside bias.
Upside bias, or at least just protecting SPX 1050, methinks.
Is the market open on Monday? Isn't a holiday coming up soon? I forget what day it is…
Labour day is first mon in Sept, no? 2 weeks if that's right.
This weak volume and anemic vix is going to allow a break to the upside at 2pm or 3pm ET
There's no volume at all today. The market will likely go higher into the close today, if it doesn't breakdown soon. It's forming a bull flag (weak one, but with light volume it could play out) on the 60 minute chart now.
We might be doing an ABC move up to 1070 or so, with this pull back being wave B, and wave C to follow tomorrow (assuming the GDP number isn't horrible?).
IWM, has that clearly in a downtrend, middle bb band… good for shorting. These things usually have 3 possible short entries. a little higher than today, 1. 5% higher or right now
Dow Jones hits the trend line
http://niftychartsandpatterns.blogspot.com/2010…
IWM thoughts, 3 to 5 days out.
http://zstock7.com/wp- content/uploads/2010/08/iwm-8-26.jpg
Looks like:
PRIMARY 3
INTERMEDIATE 1
MINOR 3
MINUTE [iii]
Minuette v
Subminuette 1
Sounds good too be… LOL! I can't wait until it's all wave 3's!
Anna has a 104.81 FP gang… so that could be our downside target today?
another round trip day 🙂
Red, I know you have mentioned FP before, what is FP? And how did she come up with that level?
FP means Fake Print, or ghost print, or casper. They are targets TPTB put out there to tell their friends where they are going to take the market.
Thank you, good to know.
getting close here
To what? Bouncing back up, or falling off a cliff? LOL
104.80 we got 104.88
Will SOMEONE fulfill my wish and make these !@$#@$ markets fall off a cliff? K Thx! 😉
Red, that was not a good close, let see what tomorrow brings. On the daily(spx), the bollinger bands are expanding, the RSI could still go lower. You may be right we are going lower. Fingers crossed! If it at closed at 1040 that would be an even better close.
Yeah, and just briefly looking at the charts, the 60, 15, and 5 minute charts are pointing back down now. Not good for a rally, that's for sure. But, who knows? Maybe they will spin the GDP to a positive number, and up and up and away we go!
http://www.screencast.com/users/Annamall2/folde…
I see the FP on your chart. It looks like it happened at the open. I'm assuming that's why you posted the chart… 🙂
no that was it it was 104.81 and this is H&S
The upper tail hit your 105.50 I think.
adding more spy puts
I do wonder about the GDP tomorrow? If it's viewed positive, will it rally the market, or are we done? It looks like there is more selling coming, but the light volume is puzzling?
might see it tomorrow just trading according to charts not news
Bernie is cooking the books up at Golf and Tennis as we speak.
LOL…
Yes, this could be a wave B down in an ABC up to the 1070 area? Or, we could be in a wave 3 down? Hard to say?
Wow what a stick 1052.5, hit 200 on 5 minute now what??
We roll back over it looks like… 🙂
Nice call Anna. You could not have been closer than that.
S&P 500 analysis after closing bell
http://niftychartsandpatterns.blogspot.com/2010…
Red is going to have a field day this evening! Looks like his call was Golden. As Red would say “Watch out below”.
2 more days for the bears to feast. ……that is all………………….
Went long with a 1/2 position in DRN after hours (40.20, but I could have gotten in for $40 if I waited). There are a gazillion reasons to be bearish but this chart is suggesting something else:
http://www.screencast.com/users/dreadwin/folder…
I won't rule out a move up, as it's certain possible. But, I did notice on that chart that the MACD's had crossed over and were pointing up at the previous black candle you have circle.
However, right now the MACD's are still pointing down on the black candle we had today. That's a big difference and shouldn't be ignored. If today's daily chart was showing any signs of pointing back up then I'd agree with you that we might rally, but the comparison in that chart isn't equal in my opinion.
But good luck with it Dread… I do wish you well. Maybe it will show some signs of turning up tomorrow? I don't know? Anything is possible.
The MACD is definitely in a weaker position this time around. I was mainly focused on the fractal pattern of the candlesticks. Candlestick theory generally is unconcerned with MACD or RSI.
Go here if you want to explore more candlestick theory:
http://www.americanbulls.com/StockPage.asp?Comp…
I try to look at candlestick patterns too, but I like to combine them with the other TA's as well. I just think that the larger time frames are now a lot more negative then they were back then… especially since the market is now below the moving averages instead of above them.
Take a look at the daily chart for SPG (the leading REIT). Yes, MACD is bearish, but RSI is over 50. A clear 5 waves up from July, and an ABC down from the high with a shallow retrace. The C wave really does look finished. Price bounced of the confluence of the lower bollinger band and the 50 day moving average. I just don't see anything bearish there. Next stop is likely to be the upper bollinger band.
Do have a link to the chart handy?
Here ya go:
http://www.screencast.com/users/dreadwin/folder…
That chart do look like it could roll back up. And, it's trading above the 20 and 50 moving averages, while the spx isn't. Big difference between the two. On top of that, it's hitting the low BB level too… which could give it support.
That whole move up from 75 to 94, and then down to the current price… looks like a bull flag too me. So yes, I agree with you on that chart. It does look bullish.
Mkt follows SPG – I have heard that before …
It looks like its topping to me. BBs are tightening. Dropped to the lower BB and now bouncing to midline/ 20 day average where it most likely repelled. It's probably lagging the overall market by a few days.
New video update. Refresh page.
20 day average will be dropping below the 50 soon. Of course, it's a lagging indicator so the market should be well south when that happens.
Even better news, it appears that T Theory Guru has extended his major T, that was due to expire, into next week joining the multitude of other gurus calling for a rally into the end of August.
Nice down day with negative breadth to keep the McSummation declining while also allowing the BBs to continue to widen.
Jaywiz is my newest contrarian indicator. Called for the market to drop 20% on Monday. Now says there will be no crash. Had today as a positive day with it continuing to rally into Monday. Last I saw oil was off its high for the day quite a bit. Todays bar is similar to bars seen before melt-ups in June and July but on those days breadth was positive and the ramp-up was already beginning in after-hours which I haven't seen so far. (but haven't checked in a few hours)
Wow!!! you have to listen to Tony on this….
http://www.youtube.com/watch?v=XOfRLINVqcg&feat…
Common sense. Nice to hear.
Thanks for posting.
Dow Jones futures before opening bell
http://niftychartsandpatterns.blogspot.com/2010…
“The government revised its reading of second-quarter gross domestic product to 1.6%. That was down from the previously reported 2.4%, but still topped expectations.
Economists surveyed by Briefing.com were expecting economic activity to slow to 1.4%. “
… And the futures markets are rejoicing at this? =blink=
MMm!!! Nice waterfall! Keep it up! W00t!
That might be all we get today Woody? It's a double bottom now and since the GDP and Ben's speech is over, it's likely to rise back up later today.
Hoover DAM! 😉 PPT is at the wheel again, eh?
That's why I went long and staying long.
So far you are right Newbear, but I just think there might be one more flush out before a small rally. We'll see… the day ain't over yet.
What absolute garbage.
Well gang, we knew that this could happen. This is one of those times where the charts don't matter. The crooks are going to buy it up and rally it… period!
I put my $$$ on this.
Do you know someone at Goldman Sachs? LOL
I think the IYT chart I posted last night showed pretty good fractal evidence that we were going to rally today.
Today was a great day for bulls and bears. If you sold the rally yesterday at 1060ish and covered this morning, you banked coin. If you bought on weakness yesterday or today and sold today, you banked coin. I did!
Yes Dread…
It looked like they both played out. Down to the double bottom and then a rally. At this point however, the market needs to break out of this channel if it wants to rally next week too. We'll see, but I think the upside is limited.
Red, I think we have been in a complex wave 4 all week. Lots of ABCs. I think we are going to retrace half of this gain by Monday.
It's a lot of whipsaw action, designed to frustrate the bears, and give the bulls false hope. In the end, they will both lose… LOL
Since today is Friday, and all the bad news is out now, and the fact that the rest of the day is likely to have light volume… I'd say that this would be the perfect day for the market to break out of the falling channel.
This assumes that they want to rally the market now, and this isn't just a head fake? It's a nice double bottom now around 1040, so it might hold today. The key is if they break out of the falling channel or not by the end of the day.
I don't see the VIX going above 29 for a few days.
It's at gap fill right now, so it might not fall too much further. But, it might not rise either?
Man, the GDP and Bernankes' speech must have been wonderful…
he said it.
he will print money to purchase securities to prop the market.
Effen unbelievable. Just absolutely silly.
It's Bear Squeezing time!
Dow Jones futures trading range
http://niftychartsandpatterns.blogspot.com/2010…
buying a whole lot of HPQ longs options, today. don't you just love the dow 30?
The market might be rallying but Goldman isn't…
SPX double top at 1060, or going to break through?
Looks like it Woody… as we are forming a bull flag now.
On what??
The bull flag has now been played out Jim. It was on the SPX. Now I don't see any pattern.
Were you referring to the transition from the 26th throught 27th. Bull flag on 26th
No, just the intraday movement on the 10 minute chart from today only.
Thanks. It looks like its still in play??
As Red said, GS is down (currently 1.7% !). Also look at big cap techs: aapl, msft, csco, all very weak. Big sellers are raising cash into this sham ramp up. Note gold also up.
Looks like the computers in permanent buy mode today, with no reason or sense whatsoever.
S&P 500 resistance level
http://niftychartsandpatterns.blogspot.com/2010…
Pump it, pump, pump it. Just unrelenting today. You can see over the last few weeks that the pumps have gotten more aggressive and violent in nature.
Buy programs may accelerate at 3pm
Yes, it's “stick it to the bears time” right now.
these kinda days technicals are just plain worthless. market turns faster than you can react.
Gap up, tank, Bernie talks and euphoria.
Weiss group just came out w/ a buy spy recommendation.
Weiss group isn't so “wise” in my opinion.