Sunday, March 27, 2011

GOLD and S&P

Although the reversal in Gold on Thursday was not a 'classic' bearish engulfing reversal the market action certainly had many of the characteristics of a significant reversal.
Here are the important price levels to monitor:
  • geometric fan lines from previous lows are at 1398-1410 and 1367 with the former level being the most significant.
  • 720 degrees (2 Gann square cycles) from the July 28th low at 1155.90 equals 1444--which is very close to the recent high.
  • 1382.60 low swing pivot is quite important--a break of that level would suggest lower prices in the near future.
There is evidence of momentum divergence with both the RSI and MACD.


The are several geometric cycles that line up for a potential trend change in the current time frame.
  • December 3 2009 high + 480 calendar days = March 28 2011
  • June 28 2010 high + 270 cd = March 25 2011
  • July 28 2010 low + 240 cd = March 25 2011
  • Dec 7 2010 high + 120 cd = April 6 2011
  • January 27 2011 low + 60 cd = March 28 2011.
Having such a large number of geometric harmonics falling on the March 25-28 time period is quite a powerful indication of a trend change.


SPX 500
The S&P stopped near the linear down trend line emanating from the Feb 18th high of 1344.07. The market declined 95.02 points into the March 16th low. If--repeat--if--the market were to decline again starting now--an approximate equal decline in amplitude--95 points--would bring the market down to the 200 day exponential moving average--which is a typical place for important bottoms to be made during bull market corrections.
There are several geometric cycles due in this time frame--hence the ENERGY DATE WINDOW--that could be the start of a resumption of the recent downtrend--especially of gold decides to tank!!!!!!

Bottom Line: Until the 1173.00 level is broken on the downside the BULL has control of the market and it is my belief that eventually the 1360-1365 level will be tested--likely in June of 2011. If the S&P tests the 1360-1365 level coincident with a Energy Date--especially from mid May to mid June--there may be a case to look for further evidence of a MAJOR top being made which will be followed by a significant--and VERY TRADABLE decline.

The 45 degree geometric fan line from the November 16th low of 1173 is at 1301 on Monday and is rising 1 point per calendar day.
The 45 degree geometric fan line from the Feb. 18th high is at 1306 on Monday and declining 1 point per calendar day.

If the 1301 level is broken lower prices can be expected short term.

Friday, March 25, 2011

SPX 500

The S&P chart is turning back up with the upper swing point at 1332.28. This is a critical price point. A break above this level will supplement the fact that the 21 day HLC exp. moving averages have turned up. The downtrend line from the Feb 18th high is currently being tested--if this is successfully taken out the markets could rush up into the harmonic resistance at 1360-1365. If the previous rallies are multiplied by 61.8% and added to the latest pivot low (1249.05) the result is a measured move to 1354-1364--right in line with the harmonic level calculated on the March 16th update.
The potential for a huge move to the upside is present. If an impulse wave commenced at the 1249.05 low on March 16th--(1.50 cycles from the 8/27-11/16 lows and 120 days from the Nov 16th low @ 1173.00)--and it is related to the two waves since the 8/27 low--a measured move suggests a rally to the 1420-1440 level !!!!!!

The 45^ fan line from the 1173.00 Nov 16 low is currently at 1301.00 (support)
The 45^ fan line from the 1344.07 Feb 18th high is at 1310.07
The 36^ " " " 1319.37
The 30^ " " " 1324.44

The Support harmonic from the previous lows is 1173.00-1039.70 = 133.30 + 1173.00 = 1306.30

Monday, March 21, 2011

Thursday, March 17, 2011

Vernal Equinox Chart
The Spring Equinox--March 20 @ 7:21pm edt--will be powerful this year since a full moon occurs one day before on Saturday March 19th at 2:10 pm edt. A conjunction of the Sun and Uranus will occur on Monday the 21st @ 8:24am. This has a powerful 'signature' which may be symbolic of volatility, unexpected and profound change and intense social behavior. The opening of the NYSE Monday morning may be one to remember.
The harmonic support levels associated with this phenomena are:
1080 + 240 = 1320
1080 + 180 = 1260.
1080 + 120 = 1200


Dow Transports
The Transports have not deteriorated as much as the S&P which can be considered somewhat bullish--but the swing chart has turned down and a break of the recent lows--especially on a closing basis may be accompanied by further weakness in the broad markets. A close below 4722.72 would be a very bearish signal for the future direction of the markets.


S&P 500
The swing chart turned down when the S&P broke the 1294.26 low and 1306.10 low close this week. The market has found some Fibonacci support at the lower levels of Tuesdays trading range. The swing pivot at 1294-1306 may be a strong resistance area that will stop any sustained advance--however--a close above 1306 would have to be considered at least a short term bullish indication. This weekend is quite powerful from a cyclical perspective with the March 28-30th time frame also being significant. If the Bull is to reassert itself a low should be seen during one of these time frames.






VIX: No Break out yet..................

Wednesday, March 16, 2011

Making a TOP

The important 1294-1306 daily SWING low gave way during the last few days and initial support has been established at the minor swing low point of 1261.70--the January 7th low.

Today--March 16th marks 120 days from the CRITICAL Swing LOW of 1173 that was established on November 16th. The markets are becoming slightly oversold so it would not be surprising to see some sort of a bounce in the S&P from these levels. However, it should be remembered that the DAILY SWING Chart has TURNED DOWN.

The previous swing low of 1294 I/D and 1306 close becomes the level to watch for resistance to any rally. The upcoming full moon--vernal equinox and Sun-Uranus conjunction may be QUITE important. The next period of energy will be seen in the March 28-31st time frame.

More on this weekends events later.



The weekly chart is beginning to break down with the CRITICAL 1173 acting as the weekly SWING LOW. If this level is broken a strong case will be able to be made for a termination of the intermediate trend that commenced at the July 1st lows.

VIX has exploded--breaking the 24% level and attacking the 28% level and is indicating quite strongly that the intermediate cycle is terminating and that the markets are about to commence an extended period of volatile decline.

While the harmonic level of 1360-1365 is still attainable--the technical damage being seen in the S&P suggests that the probabilities of this happening are diminishing quickly.

Tuesday, March 15, 2011

1st lower support holding (1261-1271)

The minor swing low at 1271 appears to be hold for the time being. A break of 1261-1271 would set up a quick decline to test the highly important 1173.00 pivot.

More charts later--kinda busy this week.

Thursday, March 10, 2011

A Big, Beautiful, And Bullish Look 140-Year Look At Equities Vs. Commodities

This is a VERY interesting chart.

A Big, Beautiful, And Bullish Look 140-Year Look At Equities Vs. Commodities

TSX Reversal?

UPDATE: A few things to watch today:
  • Copper has taken out the previous swing low turning the trend to down.
  • The commodity board is awash in red ink today--bubble burst?
  • Watch the VIX and Transports. Transports are hanging in which may provide buoyancy to the rest of the equity board.
  • 1294.26 low of Feb 24th (March 9 2009 + 720 days) is still holding.
  • 55 day exponential; moving average--which contained the November correction is at 1292.81
  • 21 day moving averages of highs, lows, and closes (trend band) is turning down.A close above 1325 is needed to reverse this occurrence.

TSX: TORONTO
The last three days in Toronto have inflicted some damage to the bullish scenario. Monday saw a Bearish Engulfing Line reversal which was followed by two consecutive days of lower highs and lower lows. The only positive to occur this week is the fact that the 13,810.54 swing low pivot has not been taken out----yet!!!!!!

Toronto could be slightly ahead of the American markets from a cycle viewpoint. If this is the case two scenarios could play out: A reversal in the current commodity bubble and a break in the U.S. markets.



The 1294-1333 area of the S&P 500 is important for several reasons.
  • 1306.33 is the Low-to-Low harmonic from the Aug 27th low at 1039.70 and the November 16th low of 1173.00. 1173 - 1039.70 = 133.30. 1173.00 + 133.30 = 1306.33
  • 1306-1308 is the lowest closing levels on the S&P during this recent decline. (see chart)
  • The low 1294.26 on February 24th is 720 days from the March 6, 2009 MAJOR LOW.
  • The major low of March 6 2009 was 666.79. 720--2 cycles--when combined with price is in the middle of the current congestion zone. 666.79 X 2(cycles) = 1333.58 (1332.28 was the high on March 3rd)
  • VIX (chart not shown) has moved out of the sub-20 zone and is building a potentially bullish pattern near the 20-21 % mark. A break to the upside at any time would be quite bearish--especially above 24%
  • If the 1294.26 low is broken it will cause the first lower swing point since the August low. This--if it occurs--will suggest that the intermediate cycle is turning down.




US DOLLAR
The dollar appears to be hanging on by a thread--BUT..the low so far has been on the anticipated March 4th geometric cycle day. The low was slightly below the High-high harmonic at 76.43. (actual low was 76.29 and close of 76.40 on March 4th.
The Dollar is resting on a very important trendline--a rally from here may be caused by a different commodity market environment.

Wednesday, March 9, 2011

S&P 500

A close below 1306 will change the complexion of the market significantly.

Tuesday, March 8, 2011

SILVER

INTERESTING

Friday, March 4, 2011

The Trend Remains Your Friend

Swing Low 1294.26
Energy Date: March 18-22
PHI Projections: 1360-1365

Thursday, March 3, 2011

USDX

Will the Stock Market head lower?
Perhaps the USDX will offer a sneak peak.

The USDX seems to be have fallen into a bottomless pit but like the temporary low made on Feb 2nd another possible low is at hand.
  • June 7th + 270 = March 4
  • November 4th + 120 = March 4
  • Dec 31 + 60 = March 2
  • High-high-low projection 76.43
  • Momentum divergences forming
  • A rally > 77.43 would be a clue that the short term cycle is turning up.


Wednesday, March 2, 2011

Transports: The Index to Watch

ENERGY DATES FOR MARCH Mar 8-9 March 18-22 March 28-30

It appears that the Transports are about to continue their decline.

4700-4725 will offer important support if the decline continues.

1306 holding on the SPX. The S&P has closed between 1306-1307 three times in the last 5 sessions.


Tuesday, March 1, 2011

DOW TRANSPORTS are BREAKING DOWN

Dow Transports below 4988

SPX and Transports: Mixed Signals

The recent decline has left a murky picture with regard to the future short term direction: i.e. signs of possible weakness.
  • The Transports made a recovery high with the S&P but during the recent decline the Transports have been somewhat weaker than the S&P 500
  • The S&P formed a swing low at the Feb 24th low @ 1294.26
  • The Transports formed a swing low at 4988.67 on January 28th but briefly traded below that level on Feb 23rd at 4917.70 but rallied to close the day at 4986.21
  • The 4986 level becomes an important pivot to monitor for the Dow Transports.
  • A break of the recent swing low of 1294.26 on the S&P would suggest a further decline.

The present period Feb 28 -- March 4th represents a relatively powerful energy window.