SHORT TERM: market rallies to end a nasty October, DOW +144
Overnight the Asian markets were mixed, Europe opened higher and closed +2.2%. US index futures were lower overnight and at 8:30 the core PCE was reported unchanged at +0.2%, and Consumer spending was reported the weakest since 2004 -0.3%. Non-farm payrolls is next friday, sorry. The market gapped down slightly at the open and continued to 945 by 10:00. That was the low for the day. At 10:00 the U of M was reported at 57.6 vs 57.5, as the market bottomed and started to rally. By 1:30 the SPX had made its way through the 961 resistance pivot to 981. After that the market become choppy. By 2:30 the SPX hit 970, after FED chairman Bernanke’s speech was released:
http://www.federalreserve.gov/newsevents/speech/bernanke20081031a.htm
. A rally followed to 984 by 3:00, the high for the day. Then the market bounced around between these last two levels into the close. For the day the SPX/DOW were +1.55%, and the NDX/NAZ were +0.80%. Bonds dropped 15 ticks, Crude rallied $1.50, Gold slid $14.00, and the Euro was lower. Support for the SPX notches up to 961 and then 935, with resistance at 990 and then 1018. Short term momentum was overbought at the highs today, and then eased back some into the close. This rally continues to edge higher, and it appears we left this nasty downtrend at tuesday’s low of 845. We still have the 990 resistance pivot to overcome, but so far so good. Best to your weekend!
http://www.federalreserve.gov/newsevents/speech/bernanke20081031a.htm
. A rally followed to 984 by 3:00, the high for the day. Then the market bounced around between these last two levels into the close. For the day the SPX/DOW were +1.55%, and the NDX/NAZ were +0.80%. Bonds dropped 15 ticks, Crude rallied $1.50, Gold slid $14.00, and the Euro was lower. Support for the SPX notches up to 961 and then 935, with resistance at 990 and then 1018. Short term momentum was overbought at the highs today, and then eased back some into the close. This rally continues to edge higher, and it appears we left this nasty downtrend at tuesday’s low of 845. We still have the 990 resistance pivot to overcome, but so far so good. Best to your weekend!
MEDIUM TERM: downtrend low at SPX 840
LONG TERM: bear market, trying to establish an uptrend
Catherine,Thanks for taking the time to provide valuable info on options trading.I have a few questions.I read all your posts and you indicated that you have not traded a lot of ETF\’s.I trade them for the following reasons and I would like to get your input on my rationale.I trade either DIA/SPY Options (sometimes QQQQ)You don\’t have to get a specific stock correct you just need to get the direction of the market correct.Their implied volatility is usually lower than their underlying stock. For example the average IV a month ago was about 27%, Currently it\’s about 48% which is relatively expensive. But much cheaper than other stocks that average 120% IV.The spreads are extremely tight usually 1 penny which is awesome, so you can get in and get out without having to wait for a huge move.Like the other group member, I play short term. I forecast the direction of the market, wait for the move and cash out.I also don\’t like holding over the weekend because I have physically seen the huge deterioration of the value of the options over the weekend. Sometimes it\’s as much as 30-40%!!! Especially if you are getting close to expiration. With the tight spreads in the DIA/SPY it\’s easy to get back in the next week.I also like to 2 steps out of the money options, sometimes 3.I have not gotten exotic with it yet. Simple Buying Calls and Puts based on my market direction forecast.Anyway I am curious as to what your thoughts are with that process.C.T.
Ending diagonal:
http://i366.photobucket.com/albums/oo106/mtcharts/endingdiagonalwaveC.jpg
Hi Serg, are yu using DeMark indicators, which count 9 and 13 as possible turning points. I see a 9 on your Fork charts.
Friday surge possibly a breath of air above the surface before a plunge on Monday or Tuesday, market need to confirm the bottom before another rally, which seems unlikely in Nov.
Since when Wave 4 become impulsive? wave 3of3 of 4
wave 3 of 3 completed 10-10 wave 3of3 of 4 wll be monday
Can u imagine if we in fact get 5 waves down from Oct07 top?
It means Wave 3 will be done in late November early December
We\’ll be sitting here at least til the end of January and maybe February for the end of ths wave C or A or whatever it is
Spinner
Interesting chart; can you clarify?
You state 3 completed on 10/10, and that Monday 3 of 3 will complete?
I wonder if you are thinking that a gap up in the DOW on Monday will enable DXD to complete 3 of 4 (or 3 of 3 of 4)?
Followng the ultra short etf\’s has helped be follow the market. on the shorts we completed wave 3 on 10-10, wave 4 wlll cvomplete around 11-20 (dxd around 55) Monday we gap at the open to complete wave 3of 3.
http://stockcharts.com/h-sc/ui?s=DXD&p=W&b=4&g=0&id=p83977294440&a=153951987
I subscribed(free) to Randall Ashbourne like whole summer. It was like more technical vs. astrological so I canceled. Now I see he finally uses some astro charts
GKM,
I always though of Mish as fundamentalist, not technician
Puddy, true but what he says is "A rally into a price of
8893 on Monday, or Tuesday, of next week [being the coming week] could start another drop
… unless the price closes those days decisively above that
level." Have to see what this week says. I can\’t speak for his accuracy as I\’ve only been following him for a couple weeks and haven\’t really been tracking his results. He has been a useful source of possibly important dates based on astrological phenomenon though..
GKM – His next chart gives an alternate of 8893 on the 4th. Very possible and in S2\’s range for pullback.
Serg.no. 737 is just a lucky number. I also use .737 instead of .618 in T3 averages.Nice study. I used trix which is smoother.http://farm4.static.flickr.com/3049/2989924471_549c43c9de_o.png
Didn\’t get a chance to read this until just now. This guy is calling for a low of 7092 on the Dow for election day. This was last weeks article though so have to see what this weekend brings. Link
Bud, just fitting waves into trend change dates and seeing what works. Those work and allow a 1-1/2 day OE rally into the 21st that carries on thru Thanksgiving. Whether or not it happens is something else again.
What day does ECB announce their rate decision? It\’s this week and could be a catalyst to move the market.
Puddy - True….But, I \’ll default to you with those kind of
estimates.
The dates that appear to be most important are the 11/3.
the 11/9 area, and 11/20.
Again the real interesting points are brought up by S2 and the
27th. I am suggesting that the 24-25, should also be of
main focus. Hehehehe, should really be an important week
is what I am seeing.
SERG….agree with you. On the W4 crest. In a different fashion
I am also seeing very overbought signals. Just not so sure
we drop to 839, or lower….and I am short now ref.
conversation with Egoldspot.
O/T – reading an article on national security. In which the speaker
points out that China, India, and Brazil (EWZ) will be
the world economic leaders, in the years to come. I have
begun following EWZ for what that is worth…..
Bud – that could time out to an A of B high around Nov 28th (shortend day and almost always a bullish low volume day). That could allow for more redemptions and tax loss selling the first few weeks of Dec (B of B) followed by a slower 6-8 week C of B maybe into March or later if the topping out is slow. Fits some timelines.
Mish has a EW count and target in this article.
S2….caught a little of your question. Concerning 11/27? Was that the date?
Did some home work on the last crash I can remember, 10/19/87 to 12/3/87.
Interestingly, that was 32-33 trading days.
Using 10/10 as the start date you get 11/24-25.
I outlined my Change in trend dates the other day. Noted
was 11/10 and 11/27 is a new date.
The current CIT then are. 11/1 equals 10/31-11/3.
Nov. 9th, which is 7th-10th of Nov.
Nov. 15th, which is the 14-17th.
Nov. 20th.
Nov. 27th, which is 26th-28th.
I do not know, if these are highs, or lows.
My system is not for publication……
Serg;got it.THANKS.
Serg;what is CPC? there is no such symbol, (symbol lookup on marketwatch).
For B it similar to March bottom it\’s M followed by W
Wave 1 of 5 of (5-3-5) Of B
w1: 845-970 = 125 w2: 970-922 = 48 w3: 922-984 = 62 w4: 984-957 = 27 w5: 957+62 = 1019 should be less then that, otherwise it\’s impluse 3. Wave 2 should retrace 50 % of W1 = 922 ishhh ( I wave 5 of wave 1 should end at 1004)
Think of it as removing the noise
It\’s a sentiment – you can say it\’s an underlying structure of the market.
As u can see it shows you major highs and lows.
Because in reality it is reverse I have to display it as 1/x
so $ONE:X is 1/X
Serg, what is $ONE:$SPC ? what are you plotting on the chart?Thank you.
Steven_737
basically
1)MACD is at level where it usually rolls over.
2) about same last 4 completed
3) lower lines are parralel lines connectine 1-1, 3-iii etc
Serg, would you please explain the chart and the line of thought to conclude that wave 4 is complete?
Thanks Tony.
Hope you include some projections in the weekend update for the case of being in wave B.