$SPX - as you are aware of, there was a
heck of a drop in Futures after the disappointing jobs
data. ES futures were down over 20 ES points at one point,
they closed down about 17.
though can't say I'm too surprised, the 5 min and 15 min charts
all had a bear flag look to them and possible a H&S. also
the MACD's recycled back to zero.
As I said in the Wed newsletter, the onus was on the bulls, and
Thursday the internals were still down all day.
I guess we'll see how futures open on Sunday night
Matt, do you see the 2011 high as a crucial support? (See
my comment on kalinm's Canada post.) Because we are getting
pretty near that w/ this futures drop.
A massive gap opening on monday down at 1370 will sure bring out
the bearish headlines, but there is a pretty good cluster of daily
pivot support there, the 1370 highs of 2011 AND the rising 50 day
MA. SPX daily lower bb resides at 1378 too -- typically that
is defended on first attack. A gap to 1370 (even a "stop
clearing" sell to 1363 in the first hour or two) would certainly be
a low-risk long entry -- just cross your fingers and wait for the
PPT to get behind it. If that plays out, then a low-risk
short would be either a gap fill (back to 1398) which would also be
about where the declining 13 ema is -- usually a good target for an
initial short position. I know one person who will be backing
up his enormous truck on Monday -- the Bernanke!
As per the comments I made this weekend, I am sticking with the
plan. Cleared out shorts over the last 30 minutes and I'm
cheering on the bearded wonder -- the Bernanke. In all
seriousness. with the confluence of support here, this could be a
fake breakdown and a big rally might ensue.
Good question frtaylor and I'm no ew expert. I think that
the "I" Caldaro has marked is not a "key price marker" for the
current wave. I believe it is the wave 1 of lesser degree --
either the Oct high of 1293, or I think it's actually the early
December wave i high of 1265 or so. So I don't think his
count is in jeopardy if it breaches 1370.
But I do think that his wave I is awfully big compared to his
wave 3 (currently in progress). Also, this is isolating the
SP500 -- in looking at Global markets, this isn't jiving with them
too well. Look at, for instance, commodities or commodity
countries -- TSX for example doesn't come close to this count.
Also look at $CAC, $SSEC -- both of those countries are not
in any kind of bullish count. I know the SPX can diverge and
do its own thing, but IMO, looking at his count is to say that the
US will be impervious to any global calamity (impending
Greece/Spain/Italy catastrophe) -- as I pointed out below, the
Canadians thought the same thing in 2008 and appeared to be making
a bullish 5 wave up move. Oil crashed and they soon joined
the party. I'm not certain the storied US "growth stocks" --
PCLN, CMG, SBUX with their lofty PE ratios will be impervious to a
de-leveraging event (I argue they will come crashing down to earth
quickly).
Again, I'm no ew expert and I have some biases, so take my
comments with a grain of salt.
Yeah, there's no guarantee 1370 will hold! If it doesn't,
it just means his count is wrong. As Steve always says, use
it as a guide, not a trading signal. The issue then becomes,
what IS the wave count (at that level). Cuz if it ain't a
wave I up, then it's an A, and so maybe we just finished C???
Hmmm. Steve, I'm getting bogged down in counts!
You're probably right to key more off of the wave count two
levels down ("i"), which means we can go as low as 1265.
Newsletter
Subscribe to our email list for regular free market updates
as well as a chance to get coupons!
SPX 15 min comments
Posted by matt on 6th of Apr 2012 at 12:09 pm
$SPX - as you are aware of, there was a heck of a drop in Futures after the disappointing jobs data. ES futures were down over 20 ES points at one point, they closed down about 17.
though can't say I'm too surprised, the 5 min and 15 min charts all had a bear flag look to them and possible a H&S. also the MACD's recycled back to zero.
As I said in the Wed newsletter, the onus was on the bulls, and Thursday the internals were still down all day.
I guess we'll see how futures open on Sunday night
Matt, do you see the
Posted by frtaylor on 6th of Apr 2012 at 01:57 pm
Matt, do you see the 2011 high as a crucial support? (See my comment on kalinm's Canada post.) Because we are getting pretty near that w/ this futures drop.
A massive gap opening on
Posted by kalinm on 6th of Apr 2012 at 03:19 pm
A massive gap opening on monday down at 1370 will sure bring out the bearish headlines, but there is a pretty good cluster of daily pivot support there, the 1370 highs of 2011 AND the rising 50 day MA. SPX daily lower bb resides at 1378 too -- typically that is defended on first attack. A gap to 1370 (even a "stop clearing" sell to 1363 in the first hour or two) would certainly be a low-risk long entry -- just cross your fingers and wait for the PPT to get behind it. If that plays out, then a low-risk short would be either a gap fill (back to 1398) which would also be about where the declining 13 ema is -- usually a good target for an initial short position. I know one person who will be backing up his enormous truck on Monday -- the Bernanke!
As per the comments I
Posted by kalinm on 10th of Apr 2012 at 01:50 pm
As per the comments I made this weekend, I am sticking with the plan. Cleared out shorts over the last 30 minutes and I'm cheering on the bearded wonder -- the Bernanke. In all seriousness. with the confluence of support here, this could be a fake breakdown and a big rally might ensue.
Very good stuff kalinm!
Posted by tomW1 on 8th of Apr 2012 at 09:28 pm
Title: wave I, 1 or
Posted by kalinm on 6th of Apr 2012 at 03:09 pm
Good question frtaylor and I'm no ew expert. I think that the "I" Caldaro has marked is not a "key price marker" for the current wave. I believe it is the wave 1 of lesser degree -- either the Oct high of 1293, or I think it's actually the early December wave i high of 1265 or so. So I don't think his count is in jeopardy if it breaches 1370.
But I do think that his wave I is awfully big compared to his wave 3 (currently in progress). Also, this is isolating the SP500 -- in looking at Global markets, this isn't jiving with them too well. Look at, for instance, commodities or commodity countries -- TSX for example doesn't come close to this count. Also look at $CAC, $SSEC -- both of those countries are not in any kind of bullish count. I know the SPX can diverge and do its own thing, but IMO, looking at his count is to say that the US will be impervious to any global calamity (impending Greece/Spain/Italy catastrophe) -- as I pointed out below, the Canadians thought the same thing in 2008 and appeared to be making a bullish 5 wave up move. Oil crashed and they soon joined the party. I'm not certain the storied US "growth stocks" -- PCLN, CMG, SBUX with their lofty PE ratios will be impervious to a de-leveraging event (I argue they will come crashing down to earth quickly).
Again, I'm no ew expert and I have some biases, so take my comments with a grain of salt.
Yeah, there's no guarantee 1370
Posted by frtaylor on 6th of Apr 2012 at 03:40 pm
Yeah, there's no guarantee 1370 will hold! If it doesn't, it just means his count is wrong. As Steve always says, use it as a guide, not a trading signal. The issue then becomes, what IS the wave count (at that level). Cuz if it ain't a wave I up, then it's an A, and so maybe we just finished C??? Hmmm. Steve, I'm getting bogged down in counts!
You're probably right to key more off of the wave count two levels down ("i"), which means we can go as low as 1265.