SHORT TERM: SPX/NDX post new bull market highs, DOW -68
Overnight the Asian markets gained 0.3%. European markets opened higher and gained 0.8%. US index futures were higher overnight, and the market opened at a new uptrend high, SPX 1421, and continued to rally. Around 10:30 the SPX hit a new bull market high at 1427 and then began to pullback. The pullback continued into the last half hour of trading as the SPX hit 1411. Then a small bounce into the close ended the day at SPX 1413.
For the day the SPX/DOW were -0.45%, and the NDX/NAZ were -0.35%. Bonds gained 3 ticks, Crude added 35 cents, Gold rallied $15, and the USD was lower. Medium term support remains at the OEW 1386 and 1372 pivots, with resistance at the 1440 and 1499 pivots. Short term momentum hit extremely overbought at today’s high, theen oversold. Tomorrow, Existing home sales at 10:00, then the FOMC minutes at 2:00.
The SPX opened at a new uptrend high today, made a new bull market high, and then pulled back. The NDX made a new bull market high as well, but the DOW/NAZ did not. The divergence between major indices, futures/cash, and profit taking in AAPL helped to create the largest pullback since the first few days of August. After we posted an hourly chart of the DOW in the comment section last night, we noted that the next fews days will be quite interesting. Today’s updated version.
With the DOW failing to make a new bull market high today, and then breaking the lower rising trendline, we need to be a bit cautious if the SPX drops below 1410 and then 1407. The low today was SPX 1411. A break of these levels would suggest a completed Minor wave 3. Then probably an oversold daily RSI would be next for Minor wave 4. But if the SPX breaks 1375, then the uptrend from 1267 is probably over and, the DOW’s diagonal comes into play. This would suggest a retest of SPX 1267 would follow in the weeks ahead. The key levels: SPX 1410/07 and then 1375.
Short term support remains at SPX 1413/15 and then 1402/03, with resistance again at 1422 and then the 1440 pivot. Short term momentum hit extremely overbought today, then declined to oversold. The short term OEW charts remain positively biased, from under 1370, with the swing point now around SPX 1410. Best to your trading!
MEDIUM TERM: new high
LONG TERM: bull market new high
Hey!
Would you guys think buying gld or slv after today’s bounce would be ok. I’m looking to go long. Is there a chance we could see it dip a bit in the next couple of days for a better buying opportunity?
Thanks,
Brent
Hey Brent
What kind of dip are you talking ?
1628 is my support now in GC
I guess I should ask what a good stop would be from here?
Do you think it has started it’s 5?
Thanks Lee!
Well, one of them finally showed up, and he sounds, dare I say, bully for stocks! Which means I should be selling this little FED fed rally.
But as I said before, I really look much better in my bull suit than my bear suit, so I’m not quite ready to stroll back into the barn for a changing.
I’ll just have to wait to see if M1 shows up. If he does, and if he is bullt brew haha as well, then bear suit it is!
Aww cmon Mario aka M1 is a nice guy.. He actually was very honest and posted losers along with winners and played both sides.
I just had to stick up for ole M1..+ there wasn’t a question he wouldn’t ask regardless of trend
I meant no disrespect to either of them (though Bannister doth try my patience:)
I agree with you – no problem with M1 and I didn’t mean anything more than a light hearted nod to his bearishness … and the fact is that I am more than a bit worried that Tonys 30% alt count, which I beleive is M1′s preferred count, is actually coming to pass.
So my apologies to either M1 or Dolly Bannister if they too offense at my post – I meant no harm, truly.
Oh DB is def a character
I don’t think it was disrespectful at all and I like ur humor.
M1 would be happy u remembered his preferred count IMO
I think I remember him mentioning it a few times
U guys have a great week !
Tony
Recently you thought if the ten year bond came off 20 basis pts from its highs that would signal an entry point and the end of the multi decade bond bull market. The recent high yield was 1.86% and now trading at 1.72%. Do you believe a print at 1.66% would be a good entry point for an inverse position?
Yes, looking to add to my short position soon.
Tony, would you do it through something like TYO or TBZ?
Personally I do not think they track very well.
More inclined to follow TBF, which is posted in the public charts.
Forecasted to get long GOLD once over 1630 via a few public articles last few weeks. We are long DGP from yesterday morning and I see GOLD now starting Primary wave 5 to 2300 by June 2013.
Also, markets appear to be pricing in a rise in inflation… which would make sense for Bonds to start falling further in value and stocks to rise and surprise…
Gold though should be the standout from now til next summer % wise…
thank you for your input
I bought gold but not this week. Its prop…. It’s propri…. it’s a secret
Hey Tony,
Is the weekly silver chart yours or Patrick’s count? The count fits into your comments about gold and silver, but the gold chart is by Patrick.
Thanks John
Correct John, the Silver chart is my count
You the man Tony… appreciate your work always
“Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery,”
Many participants at the Fed’s meeting said that a new large-scale asset-purchase program “could provide additional support for the economic recovery.”
“It was noted that such an extension might be particularly effective if done in conjunction with a statement indicating that a highly accommodative stance of monetary policy was likely to be maintained even as the recovery progressed,”
that third one is a kicker. sort of throws out the window the concept that the Fed will only do QE if stocks are down…
Agree!
Even the fairly soon comment deserves attention.
Gold traders noticed it.
“we will keep doing QE for as long as we feel like it.”
i can’t shake the suspicion that someday i’ll just be selling my stocks directly to the Fed…
buy dips sell rallys
Some quite bullish comments in today’s FOMC statement
This year’s dry conditions has done wonders to grape growers
In Niagara region, they say they are having the sweetest, lushest grapes ever ready for picking ahead of usual picking season
Bottoms up
Well you might need to wait a while but hey there’s others stuff to drink while waiting
i love the smell of BTFD in the morning
Duvall’s best movie ever
Bouncing right of TL and MA. 1417 is HWB
1417 smells about right
thanks HD
previous 4th is @1396
everyone staring waiting for spx to break 1407. prob means we do the reverse and rally now.
aapl not playing along with the bear game today.
http://i.imgur.com/DFTyK.gif
like i said, if a bear can’t handle a little kitty, how can it possible handle a bull??
haha..that’s not “a little kitty”…that kitty has “world domination” written all over it!!!… Hey Lee, exciting footage!…the “baby steps’ ur starting to take in the motion pictures business are very impressive !
The other interesting tidbit is that the big farmers (farming 2,000+ acres here in Iowa) likely are not carrying but a minimal amount of federal crop insurance. How this affects tillable acreage prices will be interesting. The big guys don’t always own all the acres they till so perhaps there may be some unhappy seed sales personnel & land owners who leased to these guys but I’m guessing land prices will hang in there. Our guy thinks yields may be better this fall than wall street expects (at least in this area, the soybeans were saved from total destruction by the late rains). Even so, it looks to me like corn prices broke the $7 level, and I would think a retracement to that $7 level on a retest would be appropriate before continuing to move upward. Thoughts, Tony?
all ears
Good morning all! Just another comment from the Heartland for you corn traders. One of our neighbors lost 2 horses from a lightning strike in that rare thunderstorm we recently had. They dug a hole 8′ deep to bury the horses. About 5″ of topsoil looked back to normal. Everything below that was like CEMENT! We’re going to have to have a very wet fall, winter & spring or the Midwest will be facing lingering crop damage to the 2013 crop from this drought since the subsoil moisture level is just not there.
Also, one neighbor forward sold 100% of his 2012 bean crop earlier in the year. He’s sweating bullets. There’s no definitive word yet on whether farmers like him will be forced into the market to buy corn/soybeans to deliver on their contracts this fall. The guy we have leased our fields to is very conservative & he told me the other day that he forward sold about 6,000 bu of 2013 corn but as the drought got worse, he stopped (that’s a very minor amount of his expected yield). Wants to see the yield from the 2012 crop before he makes any further bets on 2013.
thank you … cement it is.
@McKennedy. Thank you. I really appreciate your update.
Thanks MCK
It’s crazy …folks wishing for a gulf hurricane now…not the people living on the gulf coast of course
Last year record floods
This year record drought
Next year back to normal
Back to normal will still probably mean lingering damage to the 2013 crop.
agree
Dow Jones on the weekly chart indicating decline after testing resistance at 13.268k. If the index respects this support is likely to seek support in 12.867k
analysys link.
http://www.partnerinvestimentos.blogspot.com
DAX Time Ratio 161.8…
http://astrofibo.blogspot.ca/2012/08/dax-time-ratio-1618.html
OIL Fibo 61.8…
http://astrofibo.blogspot.ca/2012/08/oil-fibo-618.html
10Yr Bund: Since Europe’s debt crisis still is one of the prime drivers I think it is useful to look at the Bund market for cues of sentiment shifts. To me it looks like the primary C might not be completed yet but their is a possibility for a flat 4 before prime C is set. Further, we have also seen buying shadows on the daily this week. Hence I have reduced my short pos to just 1/3 short.
Daily
http://screencast.com/t/Nbdplv49
don’t kill the messenger, guys… here’s another voice from EWI … on energy… Oh, looks like Jeff Macke is back on the rails =) http://finance.yahoo.com/blogs/breakout/crude-oil-heading-2008-low-32-40-elliott-120711517.html
Hey I made that mistake yesterday C B !
I just bought a Hummer Limousine as my main driver so that’s good news !
I’m game
haa…you have a knack for putting positive spin on “oh, so terrible econ. trends” Lee.ur a fountain of optimism…I thought that Hummers were only for real estate ppl….
Hey, love that new avatar Lee…a sweet little dawg
lol..Oh and ur new name, too Lee!!!. That’s a hilarious nickname… Ur our “cool-name-inventor-extraordinaire”
As some of you may recall, 1426, and 1497 have been my wave 5 targets from 1267 for some time. While the SPX is still a little murky, the DJIA clearly completed a 5 wave sequence from the June lows today. That, coupled with the SPX reaching the 1426 level, ans the sell-off from that point leads me to believe we have seen at least a medium term top.
Thanks,
Steve
http://5wavemodel.blogspot.com/2012/08/tuesdays-market-082112.html
Thanks Steve
Choppy little bugger ain’t it….
Haha….Yes it certainly is.
Thanks 5wave
This might be the real deal bear raid as our resident bears, M1 and D. Bannister, are nearly conspicuous in their absence.
Beetlejuice…Beetlejuice…Beetlejui…….
i give ‘em about 1-4 hours before chiming in. they’re the ghosts with the most, babe
Here’s the vix
http://screencast.com/t/addwHVdm6
Hey, dont look now MA, but it a rising bear wedge? Uh OH….
We closed our TNA yesterday at 56.40 for profits anyways… no position now
3x – sent a request
Thanks
Blog still private
Watch 1403 for pivot
Thanks Tony! Lots more folks becoming bearish. Goldman Sachs (typically wrong) has been telling clients to sell stocks before we fall off the fiscal cliff. Have you moved the probability of a retest of SPX 1267 back to 30% (from 20%)?
yes 30%
FTSE Time Ratio 1999 – 2012…
http://astrofibo.blogspot.ca/2012/08/ftse-time-ratio-1618-1999-2012.html
That’s quite a prediction
InterestingTime Ratio…
Finally we have a sane market.Nice 15+ point range.Where are the perma bears and bulls now?
lol. Market perfectly positioned in the middle so neither side gets too excited and over smart ppl get clobbered on each side.
Thanks Tony !
http://i.minus.com/ibe7INtXYUkcM2.gif
ASTRO Reversal 21 August 2012…
http://astrofibo.blogspot.ca/2012/08/astro-reversal-21-august-2012.html
good update Tony. concise, and very useful. Thanks. -rc