Yeah right... and I've got some ocean front property for sale in Kansas too! Once again, the run up into opx week has started off with a bang. Will it continue until Friday? Probably not much high, but not much lower either I'm afraid. This light volume period that we are in now, will allow them to easily gap up over resistance levels by running it up in the pre-market session first just like they did today.
So while there still might be a pullback, I think the 1040 level is off the table now. Maybe we dip to 1060 for the "B" wave down, but it may not happen until after opx is over. We could chop sideway until then, and sell off a little bit this week and a little bit more early next week.
However, the big concern is whether or not that week chart continues to roll back up, putting in higher lows on the histogram bars. That could mean that we aren't going to go down below the 1010 low for awhile.
If so, then we could just sell off next week, and rally the next few weeks after that (and maybe go for the DIA 118.16 print?). Now I don't know if that's going to happen or not, but the weekly is looking like it wants to roll back up. So, just keep your eye on that chart, for it would likely put a limit on the downside for now... at least until it turns back down again.
Moving on to tomorrow...
The daily chart is still moving up, but the ADX line is falling now. It's losing strength... finally! The negative and positive DI line are converging together now, which means it should be choppy in the market for the next few days. No major moves up or down should be expected during this criss-cross period.
The 60 minute chart is losing steam too, after putting in a much smaller histogram tower then the previous one. With the larger amount of open interest on the 107 spy put (289,000), I'd say that we will not go below 107 before this Friday. And, since the call side has 110,000 contracts at the 110 level, I'd also say we close below that level on Friday too.
Split the difference and you are looking at 108-109 spy level on Friday. Which really makes more sense if they plan on dropping back a little early next week to maybe 1060 spx... (1040 would be a gift to the bears, and could halt the up move?), before a move up to 112.41 next week. I'm not ruling out the possibility that we hit 112.41 spy by this Friday, but the odds are decreasing because the daily chart is losing steam.
So, my best guess for tomorrow is a slightly down day (not likely lower then 1080 area) or flat. But I don't expect too much more on the upside without a "pause" day or slight pullback at this point.
Red
-------------------------------------------------------------------------------------
Bullish OPX Week?
Most option expiration weeks are bullish, and I expect this one too be so as well (barring another false flag event, or planned default of some country of course). We are in the light volume season of the summer months now, and the market can easily be control now with a lot less money... aka Free Printed Money given to the PPT.
So, the question is... which way do they want to take the market? I think they want to take it up for awhile, as the media is still very bearish (at it seems that way to me). I'm looking for a small pullback early in the week (Monday and possibly Tuesday too), and then a move higher or sideways the rest of the week.
The daily chart supports a move up this week, but how far is anyone's guess? Many say it will go to the next Fib. Level of 1085 or so, and others say about 1100. I think we will go to 112.41, either by the end of this week or the next. I think we are in a larger wave 2 up on the weekly chart now, and that would support a higher move up then just the Fib. Levels.
However, it could take 2-4 weeks to get up there... should it not put in a lower low on the histogram bar for the weekly chart to discredit this analysis. The monthly is still bearish, which certainly confirms that we are moving down overall. But, we should have rallies back up within the shorter time frames of course.
I'm not too good a counting elliottwaves, but if the weekly chart did complete a 5 wave down pattern, to form a larger wave 1 down, then we could be in larger wave 2 up now. If so, then several weeks of grinding higher is going to be needed to shake off the bearishness that is still out there.
We already had one week of a rally, and this week up could be enough to satisfy a larger wave 2 up in that week chart, but it could drag out for a third or fourth week. I don't think it will, but I do think that the 112.41 spy print will be hit before another serious move down will start.
If that target is hit this week, then I can see another larger move down starting the following week. So, while I do believe we will close this week out positive, it might only get to either the 1085 Fib. Level, or the 1100 Level by this coming Friday. That would mean that the following week would be needed to hit the 112.41 spy target (about 1120 spx).
On a shorter time frame, I think we could go down on Monday and early Tuesday, and then up into Friday. The 1060 area would be a very shallow pullback, but with no selling pressure yet, that could be all we get? The 1040 level is more likely, and should be the pullback low. Then up to start the "C" wave up in an ABC move from the 1010 low.
For the bears, I'd wait until that daily chart finishes putting in a lower tower high on the histogram bars before shorting. It wouldn't surprise me if we only went down to 1060, before ramping up higher into Friday. There were probably some bears that went short on Friday, because we hit the 50% Fib. Level... which also makes me think they might push up with that last gasp (on the 15 and 60 minute charts) to 1085 Monday morning,and then roll over.
If so, then 1060 area is more likely the downside target, and then a move up into Friday. If it rolls over at the open or even gaps down, then I believe 1040 is more likely the downside move for the "B" wave. Personally, I'll feel much better on the short side once that 112.41 print is hit. For now, the bulls have control. The only thing next week that can move the market, is earnings... and you know how easy that is too make up.
It's not going to last for long though folks. All this bullishness will be over soon, and the bears will rejoice again. But for next week, the bears should take a vacation... as any move down is best left for day traders, not swing traders.
Is it time for the Bears to go back into hibernation?
Yesterday I called for the 1070.50 spx print to be hit, and it did exactly that today. But, will my call for a sell off tomorrow be right? I doubt it, as my luck isn't that good. I may get a few calls right from time to time, but tomorrow looks quite bullish right now, so calling for a big sell off is probably just wishful dreaming on my part.
The daily chart is pushing the market up hard, from oversold territory. It's about to cross over the zero level on the histogram bars... quite bullish. It could easily last until opx next Friday... or longer? And, it could just as easily roll back down tomorrow too.
There is no way of knowing how high it will go, with regard to putting in higher histogram bars... which should make a higher price on the overall market too.
The 60 minute chart is overbought, as the daily keeps pushing it back up every time it tries to roll over. The 15 minute chart has already dipped below into oversold territory and is now coming back up now. That's what caused the run up into the close, as the 15 finally curled up and crossed back above the zero level into positive territory again.
Overall, tomorrow looks very bullish with the daily and 15 minute chart ready to push the market up to the next level. The 60 is overbought though, which could limit the upside, and in fact it could make the day just trade sideways as the charts aren't all lined up together pointing in the same direction.
Honestly, I don't see much hope for the bears right now. The light volume will keep the market from selling off hard. I think a big news event is needed to bring the market down now. What could that be? I don't know? Maybe nothing, as they may want to take it up to 112.41 next week first, before they sell it off.
To sum it up, a slight down or flat day is bullish as that would just be a pullback in a move up higher next week. A gap up and crap could be very bearish though, as that might indicate that the sell off has started. The last hope for the bears tomorrow is a hard sell off... one that would make the bulls bail out, that just went long. But, I just don't see it in the charts. Sorry about that (I really am, as I'm short the market... so I'm a bear right now).
So the bulls have the ball for now, with 4 downs to go... at the bears' goal line. The only hope for the bears is a fumble. (Let it rain, snow, and hail down tomorrow on the field... go bears)
Well that would be me of course. Today closed at 106.30 spy, and filled the fake print I posted with 10 cents to spare... What will tomorrow bring? I see two options here: One, a run up to 1070.50 spx, to fill that fake print... or Two, we just open flat or down, and start selling off.
If we pop to 1070 first, then the day should likely back off down to the closing price of today... about 1060 spx. That would give us a doji for the day, and allow Friday to be a big down day... that could wipe out all of today's gains?
OK, here's a third option... we can all take the Blue Pill, and rally on up taking out the Aprils highs and going to the DIA 118.16 print over the next few months. Yes, it's possibly... but not likely. Every time Cobra posts a chart showing the liquidity, it's being sucked out faster then the money in your wallet is (by the government of course).
I find option One or Two the most likely, and give very little odds to option Three. So, should it go up to 1070, that would be a ideal shorting spot, before a huge sell off over the next coming few days. I expect next week too be really ugly, as I believe we are now in a wave 3 down on the weekly chart.
While everyone is expecting a rally up to where ever, to make a larger wave 2 up, with the move from 1220 to 1010 being wave 1, I think 1070 is as far as she going. This ship just popped the nose up into air, before a plunge to the bottom happens.
So, for you bears, the best you can hope for is a move to the 1070 level to fill that gap. For you bulls, you want a small down day to consolidate before another move higher. I also have a print of 112.41 spy, which could be the wave 2 target high... after wave 1 down is complete.
If wave 1 down is complete at 1010, then the larger wave 2 up should go to that 112.41 print before starting larger wave 3 down... which should take us to the Wilshire print level of about 725-730 spx. But that's awhile off yet, so let's just focus on this week for now.
My forecast is simple: Thursday should go up to 1070 and then reverse back down to close slightly negative or a doji, or it should simply sell off from the open and close lower for the day. Friday should be a large down day, closing this week out negative.
As for tomorrow, I don't know where we are going? That's why they call that the "indecision candle", or doji. It looks very bearish how it went up to the 1040 level that I expect on Friday (a day early I was), but we should rally at some point soon.
We are very oversold now, and appear to be basing, or consolidating in this lower range. That could be viewed as bullish, or it could be viewed as a bear flag forming... which is bearish.
The 15 minute chart look ready to rally up tomorrow, and the MACD's are recycling back up from oversold, and the histogram bars look ready to cross the zero line as well. We are also forming a support trendline from the 1010 low, and the higher low at 1015, and now 1018 today.
The 60 minute chart looks ready to go back up and make a second histogram tower above the zero line. If it's a lower tower, then it would be putting in a negative divergence. The bulls need it to be a higher tower then the top of today's tower when the market hit 1040.
The daily chart put in a higher low on the histogram bar today. That shows that an uptrend is about to start soon. The only bad thing about that, is that the MACD's aren't rolling back up yet. And, ADX line is still rising. The negative DI line did roll over today, and is now pointing down, and the positive DI line curled up today, so that's bullish.
The RSI turned back up too, and didn't penetrate the 30 level (if it did, that's really bearish). But, the charts seem mixed overall. I can see bullish points of view and bearish, so I just don't know what to think about tomorrow?
The weekly chart is still very bearish, and isn't showing any signs of going up yet. That means we should expect another down week, although that just doesn't seem likely too me. Just because I see how oversold it is, and should rally. I'm still expecting a move to 1070 soon... but when does it start?
The news out this week isn't really much of anything important, so with this light volume, you would think that we are going to start a rally this week. That's why I don't think this week will be down, even though the charts tell me it will. I'm obviously just going on my gut feeling that we are going to start that rally tomorrow, and not continue to sell off.
So, I wait for the rally, like all the other bears do. The bulls are long, and the bears are waiting to get short at a higher level. Will it happen? Who knows? Not me, that's for sure.
Good luck to everyone...
Red
Update: In the afterhours session, I just caught this print of 106.20 spy. It's likely to be our high tomorrow, should we rally.
I wasn't sure what to say this weekend, so I'll keep it short and simple. I looked hard for a reason to see a gap up on Tuesday, but I can't find one? Yes we are overdue... yes we need one... but I just can't see it in the charts yet? Last Thursday I did a video explaining that I expected a move to 1040 on Friday... but it didn't happen?
Friday had everything going for it. It had light volume, a holiday weekend in front of it, and traders leaving early... but it failed to rally? In fact, the brief rally into the close was sold off in one 10 minute bearish engulfing candle. Not good for the bulls at all.
While I still think we will see that 1070.50 spx fake print soon, it might not happen until we put in a lower low first. While we did that last week, it didn't come with any panic selling, and that's what concerns me. We need a capitulation day to wipe-out all the bulls, and get every bear back in... short again.
Most bears probably closed up their positions on Friday, expecting a rally next week. After all, who would be brave enough to hold shorts over a 3 day weekend, after selling off for 2 weeks straight now? I'd say those bears are in cash, and I'd guess that there were some bulls that went long into the weekend... but not many.
I think it's going to catch a lot of people off guard if it goes down instead of up on Tuesday. Anyway, I'll keep this short, like I said. But one other thing... you should watch this video below about the BP disaster, it confirms what I thought all along... it was another false flag event.
Red
Happy 4th of July everyone!
Update: This is a very interesting video by Karl Denninger, showing how the market in currently (as in July 4th, 2010) being manipulated up and down with fake bids and sells. Watch it... it's worth your time.
... unless you want to clean up an oil spill for BP of course.
Yes, the numbers were horrible today... for the Continuing Claims and Initial Claims that is. Tomorrow has the Nonfarm Payroll and Unemployment Rate, which should be just as bad. But, we are very oversold right now, so I'm expecting a sell off first, then a rally.
We went down to within 41 cents of the 100.72 spy fake print, before reversing hard into the close. I still think a down move to the 990 area is coming, but not tomorrow. I think the move down in the morning will only put in a higher low, and then rally the rest of the day, closing positive.
There is a lot of resistance in the 1040 area now, and I think that will stop the advance tomorrow, and could be the closing price too? However, I have a fake print of 1070.50 too, and should 1040 not hold back the bulls... a massive short squeeze could happen, taking us up to that level.
Now don't get me wrong, I don't think we will hit that target tomorrow... but anything is possible, so keep that in mind. I feel like we will hit 1040, and close around there, then hit 1070 next week, at which point I would go short again.
But let's just play it one day at a time. For tomorrow, a possible down move early in the morning on jobs data and rally the rest of the day is my forecast for Friday.
The bulls failed again today, as the bears took her down into the close...
We are getting pretty close to a temporary bottom now. I still think we will see at least the 100.72 spy fake print level, and even the low 990 spx area could come tomorrow... who knows? At that point I would expect a multi-day rally.
The charts are getting into oversold conditions now, but can continue lower. We still didn't get a capitulation day today, and that tells me we still have more selling... before a brief rally. Tomorrow could be the day, since everyone is now extremely bearish, and negative... meaning they are expecting horrible job's data on Friday.
Of course a prelude to that data will be released tomorrow morning... the Continuing Claims, and Initial Claims, but Friday will have the big kahuna... the Nonfarm Payrolls and the Unemployment Rate. I think we will bottom either tomorrow at the close or Friday... it depends on the numbers?
Will the government spin them to look "not so bad", or will they just tell the truth... which is horrible of course. I think that they will already be factored in, especially if we tank again tomorrow. The old "sell the rumor, buy the news" dance (normally, "buy the rumor, sell the news"... but reversed when bearish).
So, put the technicals with the news, tomorrow looks like the best candidate for a "capitulation day". Not saying for sure that it will happen, as we still haven't got a one day relief rally bounce, squeezing out the bears. But, there's no guarantee as to "when" that day will occur.
We now have 8 down days in a row on the NDX, while the SPX would also be the same, except for a small up day on last Friday. Not exactly what I'm looking for... to squeeze out the bears, before falling again. But then again, they did the same thing on the way up, closing higher every day with only a few small down days... trapping the bears for several months of pain.
Maybe it's the same thing going down? Trap all the bulls long, and not let them out on any rally. That should indicate that once a rally starts back up, the bears will be trapped short... with very small down days to allow them an escape.
Ok, with that said, I don't know what will happen tomorrow morning. Sorry, I wish I did. If the Continuing Claims, and Initial Claims are really bad, then we could gap down and trend down all day. If they aren't too bad, then we could rally up slightly to backtest the breakdown area from today. But, I would expect the selling to resume later, as the fear from Friday's data should cause continued downward pressure.
If we get to 990-995 area, that's a great spot to go long for several days. If we rally tomorrow (to squeeze out some bears), then the move down to that area might not happen until Friday. My gut tells me that they want a relief rally going into the 4th of July weekend... to make people feel better of course.
But, my gut isn't that accurate, so the only thing I can say, is that I expect the 990-995 area (at minimum the fake print of 100.72 spy) to be hit by Friday at the latest. Then a multi-day rally... allowing everyone another chance to get short again.
What a wonderful day today was... if you're a bear?
I certainly enjoyed it... and I don't think it's over yet. I see more selling tomorrow morning, as late comer's panic and sell at the open tomorrow. Now whether we close down, or do a hard reversal like February the 5th, 2010... is anyone's guess?
I'm looking for a minimum target of the 100.72 spy print to be hit. We could continue lower on the momentum, and hit the low 900's spx area. I certainly believe we will hit that area, but I'm not sure if it will be tomorrow or not? We all know how they like to play games to shake out the bulls and bears... but my gut tells me they will hit it tomorrow and then reverse back up.
The prints aren't always a price target, sometimes they are just the direction of the next major move. Either way, a move down to the 1000 spx general area is likely now. Look at this daily chart... it looks horrible now, at least for the bulls. The MACD's have crossed over, and are now heading down. The histogram bars just put in their first bar below the zero line. The ADX line is rising fast, with the negative DI line on top.
The 60 minute is buried on the histogram bars, but with the negative DI line still on top, with a rising ADX line... and a MACD still pointing lower, they can put in even deeper bars before turning back up. This chart shows no sign of rising yet.
The 15 minute chart is rolling back down now, after becoming overbought the last couple of hours of the day. It should roll in the morning session, and provide us the gap down needed to get the market moving in the right direction.
Overall, the charts are looking about as bearish as I've seen in a long time. That daily looks really bad, while the weekly is rising up on the histogram bars, the market is still moving lower. Some of the charts got the death cross today (when the 50ma crosses down over the 200ma), while others will soon follow.
We should be headed down for several months now, with anymore rallies only putting in lower highs (from the April 1220 spx high). I may just sit out the rallies, and simply wait to go short again? Who knows? I just like being a bear better then a bull... so waiting in cash is ok with me.
That's about it, let's all keep our eye's and ear's open for any important information that might come our way (ie... fake prints, large buy orders at a certain level, etc...)
No long post today, as nothing has change. We had a another "pause" day, and anything could happen tomorrow. The 60 minute chart has now become overbought , and can rollover at anytime. The daily chart is forming a bear flag, and could drop another large red candle down as early as tomorrow.
It's really hard to say about tomorrow. I could easily see a gap down to fulfill the bear flag, but if it fails, a large up day could also happen. You can see the bear flag, if you're bearish, and you can see considation if you are bull. I'm still very bearish, but I'm weary of surpises by the government.
The weekly chart tells me we should go down again, and put in another red candle, but again... the market could go either way right now. I'm still very bearish of course. However, some good news could easily spark a rally, so bears be careful. We are truly in "no mans land" right now...
Red
P.S. Sorry I wasn't around any, I was on the road driving all day.
Friday was basically a flat, as market shuffled companies around to re-balance the Russell index. Overall though, the market still looks extremely bearish. The technical pictures looks worst now, as the 60 minute chart has finally worked off the triple bullish divergence, by going positive (above the zero line), but now looks ready to roll back down again.
That's bad news, if you're a bull. While it could go up a little more on Monday, it's going to be really hard too go very far. The 15 minute chart is headed south again, and of course the daily, weekly, and monthly are still pointing down. So while anything is possible, the charts tell me Monday should fall hard... especially when that 60 turns back down.
It could be rolling over already, and we could have a gap down on Monday, or it the 60 could push a little higher before rolling over. So, while my gut warns me of a possible gap up and rally for several days (or weeks), the charts tell me otherwise.
That's one of the hardest things to do... follow what the charts tell you, and ignore your gut, unless you are Anna, who has an amazing ability to be right, by listening to her "gut instinct". Of course she uses charts too, but when it's time to pull the trigger, it's her gut that she listens too.
I have to hand it to her, she makes a lot of great calls that way. But I,on the other hand... I get killed listening to my gut. So, the chart tell me that we could finally have that "Black Monday" that I've called for too many times (and been wrong each time), while my gut still worries about a gap up on Monday.
That goes to show you how good of a job they do of training us sheep to do the opposite of what they do... so they can take our money of course. How else can they stay rich and powerful, while we struggle to make ends meat? The market was designed and created to take money from the unsuspecting sheep (public... aka, the retail traders - as in you and me).
So, should I listen to what all the technical analysis, astro, elliottwave, etc... tell me? Of course I should, but will I? Well, I did this time (LOL), but I can't guarantee I'll always listen. Turning off your emotions is the hardest thing to master... and I haven't master it yet. I'll make more stupid emotional decisions in the future, I'm sure of that.
But for now, I remained short... based on the charts, not my emotions. Nothing in any chart or pattern I see can justify a gap up and rally on Monday. Sure, we feel like the market is oversold now, because we fell hard 4 days in a row, and closed flat today. But the charts say the market isn't oversold yet, but still has room to go much lower.
It's times like these that test your will power as a trader. After all, chasing a falling knife isn't a wise thing to do. But, neither is going long when after a huge run up. But, if the charts say there is more room to run (up or down), then you just have to do it. They call it "Buying Overbought and Selling Oversold"... but the great thing now, is that we're NOT oversold yet! Can you believe that? After all these days down, the market isn't even in oversold territory yet.
That should make you feel even happier about going short today, as the daily chart is just now at the zero level with the histogram bars and the MACD's are just now ready to roll over and head back down south. While they could turn back at anytime, I believe we need a capitulation day first... before any big rally can occur.
On the bullish side, the weekly chart is working it's way back up, from oversold conditions. But, the bearish engulfing candle put in on that chart indicates that we will have another down week. If this week goes down the first few days, and then rallies back later in the week, then it could end with a doji candle.
That would allow the following week to rally up, and work on putting in a lower (positive... aka, above zero) histogram tower on the daily chart, then the previous tower. But for this week, I expect the daily to cross below the zero line for at least a few days, putting in a small (negative) tower. Then again, it would go back up next week and rally the market.
But this week should go down early and rise back later in the week. Will it? Who knows, but that's what the daily chart indicates it is likely to do. It would also match up with the weekly chart, as it is putting higher lows on the negative histogram tower, slowly working it's was up to the zero line and above. However, on the weekly chart, I think it will just barely make it above the zero line before rolling back down in August.
So, now that you are totally confused, I'm bearish on Monday and maybe Tuesday, then bullish for a week or two. That's what I see in the charts, but my gut tells me that it's going to rally on Monday and not stop for a couple of weeks. I choose to ignore my gut, and go with the charts. So, I'm short into Monday.
If Monday opens up, then I expect it to rally up a little in the morning, to allow the 60 minute chart to put in a few more positive histogram bars. Then, I expect it to roll over and tank into the afternoon and early Tuesday morning. While the market is turning bullish on many indicators right now, it still has just as many that are bearish too. That's why it's so tough to forecast this weeks' move. A big rally is coming soon, but I think we need a big down day to have capitulation first. Whether we get it or not, is anyones' guess?
Red
Sorry for late post gang. I had internet problem, and was down for awhile. But, I finally got the video uploaded to Youtube...
Today sold off again, for the 4th day in a row. Will it ever end, or has the bottom been found now? I’m not sure, as every chart I look at still seems bearish, with the exception of the 60 minute chart. Well, it’s only half bullish, as the histogram bars are rising up from oversold territory, and should cross the zero mark tomorrow.
But, the MACD still has turned back up on it, so it’s also a little bearish too. I think I’ve been waiting for so long for this moment to happen, that I don’t believe it’s actually here. I keep looking for a big short squeeze rally, to wipe out the bears again… but it hasn’t happened yet?
Maybe they are now torturing the bulls, by not letting them out of their longs? I don’t know, but I still have to stay that I expect more selling tomorrow too. Yes, it will be 5 days in a row, and a relief rally (aka… short squeeze, as in “relief for the bulls”) is overdue now.
However, the trend is now down… at least the short term trend. Longer term is yet unknown? Have we finally finished the Primary Wave 2 up, and are now in P3 down? I don’t know yet, but I do believe that if we continue down tomorrow, there won’t be any right shoulder around 1150 forming.
It’s too obvious now, as everyone sees it. So, I’m going with the charts… and they say we have more downside coming tomorrow. No big long post here, as I believe everyone can read the charts as well as I can by now. I can’t think of any reason to rally tomorrow, as I don’t think there is any major “market moving” news out… and the technicals are still point down.
So, just hang in there bears, as I believe another large leg down is coming. Keep in mind that Newbear posted that RationalNational (Rati) seen another fake print of 100.72 spy while in Anna’s chatroom. I have the same print, but I captured it on June the 4th. Should we tank hard tomorrow… I’d be looking for that print to be hit. There’s a reason it was put out on June the 4th, and again today… and that’s because they plan to go there soon.
Today end up being a "pause" day, or basically flat. The market sold off in the morning on the horrible housing data, but slowly inched its' way back up to close down only a few points. The Fed's kept the rates the same (not like I really expected them to raise them), and nothing else major happened throughout the day.
There was an quick move down, and hard reversal back up, when the meeting minutes were released at 2:15pm est. I'm sure that shook out a lot of bears and trapped a few bulls. But in the end, the market just basically traded sideways the rest of the day.
Ok, so here's a pop quiz for you... what kind of pattern did today put in on the 60 minute and 15 minute charts? Do do do do, do do do... do, da-do, do, do do do.... time's up. Yes, it's a bear flag! You win today's Jeopardy grand prize... a nice move down tomorrow.
Well, of course nothing is written in stone, as the market could continue sideways to up tomorrow... but I think there is a really good chance that the bear flag plays out tomorrow, and maybe Friday too? We still haven't went down and touched the lower channel trendline on the 60 minute chart, which is around 1075-1080 area.
If that level breaks, then we should fall on down to retest the 1040 level. Since we hit that area of support several times now, if we hit it again, it will likely fail. Then I would look for the monthly 20ma (currently at 994) to be then next major support. I do believe that a move below 1040 area is going to panic a lot of bulls.
Which means a lot of selling, and that means that minor supports will be broken quickly. That's why I mentioned the major support level from the monthly. Of course there will be intraday bounces going down, but they probably won't last too long. Once the bulls start running for the exits, they don't usually stop to take a breather.
Now, with all that bearishness, let's look at the bull's point of view too. If the 1075-1080 holds tomorrow, then a bounce back up to finish the wave C up in an ABC move could start at that point. That would be the move up to make the right shoulder around 1150 that everyone and their brother is now looking for.
Let's just be honest with ourselves a little here. Do you really think they will make it so obvious, and allow everyone to get in just at the perfect spot? I think you know better then that by now. We all know that they will likely trick everyone... both bulls and bears, and not allow either to make any money from whichever direction they decide to take the market.
So for tomorrow, I'm expecting the market to fall through the 1080 support area and continue on down south. Others say we bounce, and go make wave C up. I disagree... but no one now for sure, as we could both be wrong? You just never know. But the charts tell me more selling coming.
Too bad... it's time for the bears to celebrate a little bit anyway. The move down today confirms that the short term trend has changed, but how low will she go? The 1080 area, which is the lower trendline in the rising channel, is key support and needs to hold, if the bulls want to go back up to finish the right shoulder.
It's too early to tell at this point what will happen, but I do believe the week will still end down. Since the market sold off pretty hard today, a "pause" day is to be expected tomorrow. And also since the FOMC meeting is tomorrow, which are generally bullish days, that leads me to believe tomorrow will close positive.
Flat to up would be forecast for tomorrow, but not a huge up move. I expect that to happen in the morning session before the FOMC meeting at 2:15pm EST. If good ol' Benny boy simply states the usually babble, and doesn't do anything to spook the markets (like raise the rates), then there could be some more light buying, or small selling into the close.
The big question is... when will the Fed's raise rates? Bernanke has hinted at it the past meetings, that at some point they will raise the rates. OK, I got it. Now are you going to just surprise us with it on one particular meeting, or will you continue to pre-warn us, and set a date in the future for the likely time to raise them? My guess is that they will simply have a meeting one day and say... "we're raising the rates today"!
And YES! The market will panic! Will that day be tomorrow? I don't know, but if it is, then you can say goodbye to a wave C back up to finish the right shoulder... as I think the current high on Monday would be the "right shoulder high" for this large "head and shoulder" pattern.
Next up... err, I should say down, would be 1080 in a big hurry, and then on through to re-test the 1040 low again... only this time I'd expect it to break. But again, it would all depend on how much they raise the rates... and I'm not saying they will.
So, let's just assume that everything stays the same at the FOMC meeting tomorrow. Then I would continue to believe we are going to go down to the 1080 area for the completion of wave B, and then back up to 1150 area for wave C.
After that, then we would have to study the charts more to see if the weekly charts and daily charts were matching up in overbought territory, and ready to roll over or not. Again, we could continue on up past the right shoulder area and make a new high.
Remember, summer has light volume usually, and it's easy to control the market during those periods. So what will they want to do with the market? Did they buy a whole lot of shares around 1040 area, and need the market up a lot higher to unload them? Or, did they already unload on Monday of this week?
I don't know the answer to that question, but should the market rally into the FOMC meeting, the high made just prior to it would be another chance to get short for a move down to at least the 1080 level... probably by this Friday. So again, if nothing changes in the meeting, then one should look to exit all shorts by this Friday.
Of course that all changes if some "event" happens or the Fed's raise rates... then I'd say "hold on to your shorts, as this is going to be one helluva ride"...
Not so fast... we need more evidence before celebrating I believe. While today's move up and back down covered about 30 points on the swing (spx), it still had low volume on the spy. That tells me that this was just a controlled sell off, not some type of panic, or the big boys unloading.
So, we need to see a follow through tomorrow... and with some real volume behind it. Or, we may just be walking our way down to the 1080-1090 area, to put in a "B" wave down, with a "C" wave up after it. Don't get me wrong, I'm not turning bullish... but the charts tell me that this is likely only a pullback, before moving higher.
The weekly chart is still moving up, from oversold territory. The daily chart is very overbought now, so a pullback is overdue. But we need to see the week roll back down before I'll believe a move down below the 1040 level is coming. Look at the ADX lines on the daily chart. You can see that it is moving lower, indicating that there isn't any "strength" behind the sell off (or the rally).
So, daytraders should do well in this large range bound trading, but I believe a big move down isn't here yet. When the ADX line retests the previous low around 20, and starts to curl back up... that's when a big move is coming. Depending on which DI line is in control at that time, will tell the next move in the market. That should happen by this Friday at the latest.
This week I'd like to see a close outside the rising channel... ideally below 1080 spx. So while I think this week will still close down, I don't think we will see a big sell off tomorrow. The trendlines drawn in on this chart shows the 1080 area as the break point that would put market outside the channel. If we see that broken, I think she'll fall hard...
So for tomorrow, it could go either way? I'm not seeing any clear cut direction in charts. The 15 and 60 minute charts are in oversold territory and could go deeper, or rise back up and push the market up with it. The daily is very overbought and again... should pull back. But the weekly is pushing up now, and could contain any big move down.
The market really needs an "event" to cause the big sell off to start. Could be anything... maybe good ol' Ben Bernanke will raise rates this Wednesday and collapse the market? I doubt it, but anything is possible. Expect the unexpected, I say.
Back to the Future we go... date: February 5th, 2010?
I'm going to do 2 video's for this weekend update. The first one will discuss the bigger picture, including the real news of what's going on, and I'll also revisit the fake prints to try and fix them in the picture. On the second video I'll cover the technicals, a little Astrology, and then try to forecast where we might go next week.
One of the articles I talk about in the video is "Was Gulf spill an inside job?" This follows the money trail to show you all the players involved in the oil disaster. It was done on purpose because "TPTB" were losing there support to get the "Cap and Trade" bill passed. It was basically a "dead bill", after so much attention was put on Goldman Sachs for a century of corruption, that was exposed by Matt Taibbi's in an article he did called “The Great American Bubble Machine”.
That caused a big stir for Goldman, as their plans to create an bubble with the "Cap and Trade" bill was now exposed. So how do you get the public to support the bill again? Stage a disaster that will make them angry enough to allow more regulation in the oil, coal, and other NON-Green technologies... aka, the piece of trash "Cap and Trade" bill.
The other article that gives you more clues that the event was staged, was this article "ILLUMINATI Card Game..BP Oil Spill Was Planned?", in where a man named Steve Jackson puts out a deck of cards on the BP and 911 events before they happened.
Maybe you don't believe these events were staged, and the twin towers actually fell because of planes hitting them... and not the explosives that were planted, which caused them to "blow up", instead of "collapse" from burning jet fuel melting the steal beams. Hmmm... well it seems that Prime Minister David Cameron knows they were blown up, not collapsed, as told so in this speech he recently gave... "UK PM David Cameron: “9-11 when the twin towers were blown up”"
Here's more evidence that 911 was staged "Who really did 911?". Another really big "false flag" event is going to be staged to cause the total collapse of the stock market later this year, I do believe... but what will it be? Will it be World War Three? I hope not, but the Illuminati inside the Federal Reserve have been trying to get North and South Korea to go to war with each other, as well as Israel and Iran. I do believe a nuclear war is on their agenda. I just hope it is stopped from happening, and these gangsters are arrested before they destroy the world.
The stock market is how these people profit from, and get rich from... these staged events. The fake prints tell us where the market is going too, but not when. While it is still possible that next week the market collapses, I don't think it will. They still follow technicals on the charts (to some degree), and the weekly and monthly charts show that this could drag out until fall of this year, before the "death cross" (the moving averages crossing over each other) occurs on them.
Here is the link again from last weeks' "Weekend Update", that shows you that next week is horrible from an Astrology point of view. As posted by "Phoevos" (thanks again), here is the latest post about this coming week. Although I do believe that the alignment of the planets, stars, and moon do effect peoples' mood, (which should effect their decision to buy or sell in the market), I don't think it will work this time.
The market is now so heavily controlled by "Skynet" (High Frequency Trading Computer Programs, aka HFT), that the mood of the people is irrelevant as more buying and selling is done by computers now. The people have too little power to move the market. In the past they did, but I believe it's changed now, as Skynet runs the game.
Now that doesn't mean I don't see the market as selling off some next week, as I do. I just don't believe we are going to get "The Big One", as we all thought was going to happen. I think the 1080-1090 area is likely to be hit this week. (This is all assuming that the "false flag" event is scheduled for later this year, and not next week).
As for the Bilderberg meeting that was held on June 4th-6th recently, it is now clear to me that they are pumping more money into the market, (as confirmed on Cobra's blog with the Fed Liquidity and Institutional Buying and Selling charts). This means they were buying while the market was basing around 1040 spx.
The question is, how much did they buy? The amount makes a difference in determining whether the move up to our current 1120 area is enough profit for them, or are they waiting for a much higher level to be hit before unloading and going short? Will the 1150 area (the right shoulder) be enough, or will they fake everyone out and put in a new high?
Using some common sense, I think based on the volume at the current level... they aren't selling yet. Meaning, they must have picked up a large amount of shares around the 1040-1060 area, which will take more time to unload, similar to the April high. Notice how chopped around in about a 30 point range for several weeks, before plunging with the flash crash.
My point being is... if they are heavily long in the market right now, from the flash crash low, and the 2 lows around 1040, they are going to want a much higher price to unload that many shares. Think about it like this, the February 5th low never retested, and they managed to push the market up until April.
They have now had 3 similar lows to accumulate long positions, and that tells me that they are planning on stretching this out for several months, putting in a much higher high then the April one. Keep in mind here folks, that I'm just guessing at what appears to have happened. I don't know for sure that they are heavily long, but I do think that's the most likely scenario to have occurred.
On this monthly chart you can see that the 200ma is at 1048.77, which we pierced twice this month, but are now back up higher from it. While I don't have a longer term chart to test, I do believe that it is rare that any time period of a chart hit's its' 200ma, and goes through it on the first hit. The 200ma is very strong support on all charts, and will almost always provide a good bounce from it.
The exception was of course the nasty "C" wave (or wave 3) from the 2008 fall. If we were in a "C" wave (or wave 3) down right now, then "yes" we should slice through the 200ma like hot butter. But, we are in the light volume summer months now, and not even sure if we are in Larger Wave 1 down, of Primary Wave 3 or not? We could still be in Primary Wave 2 UP?
While the histogram towers are rolling over, and the MACD leveling out now, that doesn't mean we are ready to fall off a cliff yet. I do believe they are going to extend this out until this fall, before total collapse occurs. And NO, I'm not Bullish... I haven't defected, I'm still a Bear. But, the chart's tell me we are going higher to sideways for the next few months.
I'm still very bearish on the economy, but you and I both know that the economy and the market are on two different sides of the same coin. The economy lives in the real world, and the stock market lives in Fairyland.
Ok, that's more then enough to fry your brain for now. Bottom line, I think next week will choppy around a lot, but end up going down to form a "B" wave, in a larger ABC (or 5 wave push up?) wave up to DIA 118.16 (which could take months?). Monday could sell off a little, trap some bears, reverse hard on Tuesday... then fall back the rest of the week. The 1080 area is key, as a weekly close below that level could set the stage for another sell off.
Clearly this is being done to kill all the June Puts, as it has nothing to do with the news. If it did, we'd be at Dow 7,000 right now, and that would only be our first leg down. But again, the market lives in wonderland, and the rest of us live in hell. (It seems that way sometimes).
As for tomorrow, I'd tell you that I think it should crash 500 points or more, but that's about as likely as me flying to the moon at this point. We'll be lucky to get a 50 point drop (on the Dow), as this Skynet controlled market isn't going to move until next week. That's because of OPX of course... and you know those crooks aren't going to pay out any money to the bears this month.
So, with the 60 minute chart being mostly reset today, and tomorrow it will likely move back into positive territory, I'd stay we are going higher next week (wink wink). Are you reading this post Skynet? I'm uber bullish now... Dow 12,000 next week! Come on and give it too me you f@%king Bit@h from Hell...
Well, I guess I made my point on how I feel right now. No big long post, as what can I say that hasn't already been said? We all feel the same way... stunned, amazed, confused, upset, angry... did I leave anything out?
My forecast for tomorrow... more of the same B.S.
Red
P.S. I would like to see at least 50 different peoples' opinion the polls I put up. Please take the time to vote. Thanks...
I don't know yet, but there's an angry bear wait for him below....
This movement reminds me of the countless grind higher, from the February low. Day by day, the market grind-ed higher, without hardly even a blip of a correction down. We live in a world that has clearly changed tremendously since the March 2009 low.
Computer bots (Skynet) now control the market, and they follow strict rules. Upward and downward sloping trendlines are the key to understanding how they move. Overhead horizontal trendlines are easily broken now, as the light volume allows the bot's to continue pushing up through them, day after day, with NO selling sticking.
These upward and downward sloping trendlines form rising and falling wedges. In a normal market, these rising wedges would break out to the downside, and the falling wedges would breakout to the upside. They would do this at fairly predictable times.
However, with Skynet running the show, the rising wedges don't break to the downside when they come to the apex of the wedge... they gap up, to make the wedge even steeper! The rising wedge that is currently in play now, since the 1040 low, should have broken down several times by now.
But each time the market falls back and touches the trendline, the bot's kick in and push it up more. All at the same time, the "insider's" (aka... Goldman Sachs, JP Morgan, etc...) are all sitting on their hands, and not selling anything, until a certain level is reached.
Sure, they are selling small amounts into each move higher, but they haven't started to dump their core holdings yet, as that won't happen until they get the OK from "The Powers That Be" (TPTB). When is that? I have no clue. We should dump 40 points tomorrow, if there wasn't any Skynet... but we might be lucky to get 10 points.
Unless of course... it's time to press the panic button? But the longer they wait, more angry the bears will be...
Red
P.S. Don't forget to take the time and cast your vote on the Polls I have listed on the blog. Thanks...
as the market is back to gorging itself again, (but it did lose some weight, right?)
Well it looks like the market is going to fool everyone and actually go up and form the right shoulder around the 1140-1150 area now. At least that what everyone is expecting, so maybe it will actually happen now, who know? That's another way to fool everyone... do as expected, and shock'em!
Maybe they printed up some more money and injected it into the market over the last few days? It came from somewhere, but it still doesn't look like the big boys are buying. So, eventually, the retail traders will run out of steam, and then we will have another leg down.
Not that it will do any good for us bears right now, as there seems to be no doubt that this market isn't going to sell off huge between now and Friday. Maybe a backtest to the 1080 area... if the bears are lucky. But honestly, as long as the volume stays light, I don't see it happening.
So, will next week be the sell off that we have all been looking for? I guess that depends on where we close this week out at. That 1080 area is pretty important to the bulls and bears. A close below it, and I believe we will sell off next week. A close above it, and we will likely go higher next week.
As for tomorrow. I'm clueless? We are so massively overbought right now, that it's not even funny anymore. The market should drop about 20 pounds (points) tomorrow... but again, light volume allows manipulation, and if they want to keep it up... they will.
Looks like Monday decided to gap up instead of gap down... but in the end, the day still closed down. Days like these are tough on the bears, as there wasn't any news or volume supporting the move up. Just the typical Bullish Monday history pattern, and maybe just because they wanted to suck in more bulls, and squeeze out more bears.
So now what? Well, I certainly don't see tomorrow as an UP day, as I think it's obvious to everyone that the 60 minute chart is massively overbought, and started to roll over into the close today. So, it's not a matter of "if" tomorrow will be a down day, but more about "how much"?
The first support going down will be around 1080, where the upper trendline will be back-tested (from the falling channel that the market just broke out of). From there, we can expect a bounce to occur... but how much?
Will that just be a smaller wave 4 down, with another wave 5 up still to go... pushing on up to 1120-1140? Or will the triple top put in today finish the wave up from the 1042 low, (most label it a wave 4), with a big wave 5 down still to come?
I wish I knew? But I don't. It's really up to the daily chart now. If the daily turns back down tomorrow, then we could see a big wave 5 down... probably to that fake print of 100.72 spy. However, if the daily doesn't roll over tomorrow, then it's likely only a backtest at the 1080 trendline, and will likely go back up for a final smaller wave 5... completing between 1120-1140 spx.
Here's the thing to keep in your mind. Today was up on very light volume, with only about 80 million at 2pm on the SPY. The last 2 hours of the day moved the volume up to 207 million. That means the market still has a lot more sellers then buyers right now.
The market has hit the 1100-1105 area now 5 times since May 28th. Two choices are now in front of the market. It either has now weaken the resistance door enough that the next time it hits it, it will blasted through it to a much higher level (1120-1150?)... or, it's gave up for now as the door is too tough to breakdown at this current time.
Meaning, it will fall back down to a lower low to get more fuel (bears to squeeze) to go back up and test the door again at a later time period. The lack of news out this week leaves me guessing at to which scenario is accurate?
This truly is a "do or die" time for both the bulls and the bears. The line in the sand will be the 1080 backtest tomorrow. Of course I do expect a bounce off the trendline, but that bounce has too go back up and take out the 1100-1105 level, if the bulls want new highs.
For the bears, they want the bounce at the 1080 level to only go slightly back up to sideways, forming a bear flag, which will force the market to fall back into the falling channel again. If the bears can get the market back in the channel, then a wave 5 down will most likely be the path for the market. A new lower low would then happen.
Either way, a news event could spark heavy buying or selling? However, the lack of any news leans in favor of the bears, as they don't need large volume to fall, like the bulls new large volume to rise up and break through the door overhead.
In summary, I expect tomorrow to go down to at least 1080 spx, then bounce. From that point, we could continue down or make another run for the door overhead. The daily chart will give us clues, for if it rolls over tomorrow, then bears will likely control the tape. But if it continues moving higher, then it's likely just a backtest of the trendline, with more upside likely to follow.
What a short squeeze that was on Thursday and Friday! If that didn't clean out most of the bears, I don't know what will! In fact, the guys over a Mr. TopStep stated... "Today is the largest gap up on any rollover in history."
So what does that mean for next week? I see about an 69% chance of a gap down on Monday, and another down day on Tuesday to follow. If Monday gaps up, it should provide the remaining bears the best spot to go short at. That 1100 area has been hit 4 times in the last couple of weeks, and should still hold the market back on another hit.
The only way I see the market going through that level and holding it, is to consolidate there for several days, and then gap up above on the next day that has some great news to support it. Trying to go up in a rising wedge pattern, and break the resistance, (like what we have now), is extremely difficult.
The odds are very low of sustaining a gap up, while in a rising wedge pattern. There won't be any shorts left to squeeze on a gap up, and the market will likely reverse back down hard. Falling wedges breakout to the upside, and rising wedges breakout to the downside about 69% of the time, according to Thomas Bulkowski's pattern site.
Besides the rising wedge pattern, we also have a perfect looking "MA Pattern", which is a very bearish pattern, with high odds of playing out to the downside.
As you can see from those chart, the big boys aren't buying into this rally... they are selling. The Fed's aren't putting money into the market... they are withdrawing it. The mutual funds aren't getting a huge inflow of new cash either, as you can clearly see by the chart, it's as the lowest level in many years.
Did Friday look to you like a lot of buying was going on by the big boys? It didn't too me. How about Thursdays' ramp job? Did that look like the big boys buying, or just short covering?
How about this article showing that JP Morgan just sold the largest conduit deal in the CMBS market in nearly two years, for $716.3 Million. It's a package that's backed by 36 fixed-rate commercial mortgage loans secured by 96 properties. Hmmm, sounds a lot like selling Real Estate Investment Trusts (REIT's) in 2007... just before they crashed down. I wonder if they took out insurance on them too, just like Goldman Sachs did with AIG? They probably are short commercial real estate right too.
Look at this chart, that shows what the next ticking bomb is... and when it's likely to explode. (Commercial real estate isn't shown in the chart, but it's due to hit about mid-2010 to 2011... I couldn't find that chart, sorry).
Then on Friday, Rip Van Trader caught a large trade of 3.5 Million shares being bought on TZA, the ultra short bear etf for the Russell Index. Either someone is very rich, and doesn't mind losing a bunch of money, or they have some inside information that the market is going down over the next few weeks, not up.
Now, as for fake prints, I'll direct you to this print, showing 2 prints at 1055 ES... which will also fill the gap up on Thursday. Notice how all the previous fake prints were hit within 1-2 days. Will this one be different? I think not. In fact, I think we will fill that gap on Monday or early Tuesday.
Here's another strange print showing 100.72 on the SPY (about 1000 SPX), and it has not been hit in a long time... meaning that it will likely be tagged very soon. I think by Tuesday, but that's just based on my thoughts that it's going to take 2 days (Monday and Tuesday) to get the 60 minute charts extremely oversold.
Then a rally the rest of the week, to close out this triple witching option expiration week at a level that benefits the market makers the most. Where... I don't know?
Red
P.S. If you want to see a bullish case too... go read all the other blogs on the Internet, as many are turning bullish now. I don't disagree with them, as they all have valid reasons for supporting their stance. There are many charts that are turning back up now, especially the daily and weekly. But, I'll let you decide which case makes the most sense too you.
Good luck to all the bulls and bears this week.
P.S.S. Really interest read about Astrology during the next two weeks (click here to read it).
