Summary:
Could be an up day tomorrow, not sure though.
Bear's hope relies on US$ and Yield.
| Trend | Momentum | Comments - Sample for using the trend table. | |
| Long-term | Down | Idea for trading intermediate-term under primary down trend. | |
| Intermediate | Up | Overbought | |
| Short-term | Up | Neutral |
According to 2.8.3 CBOE Options Index Put/Call Ratio, I made a “green close” guess in After Bell Quick Summary. Now I’ve got the final readings from www.stockcharts.com, which is 1.55, well, maybe not high enough, but it still has a little edge for a green close tomorrow, not sure though.
The market looks very resilient in the recent 2 days pullback. According to 7.1.0 Use n vs n Rule to Identify a Trend Change, 2 vs 2, bulls won. So this is a buyable dip, well, theoretically.
What about the next then? Lots of Elliot Wave analysts think there still could be one final push up before a bigger pullback kicks in and after that the market would go to a new high much much higher. From chart pattern, however, there’re still 2 possibilities, so let’s wait and see.
1.0.3 S&P 500 SPDRs (SPY 30 min), this is a Bearish View, could be a Roof pattern in the forming.
1.0.4 S&P 500 SPDRs (SPY 15 min), this is a Bullish View, could be an Ascending Triangle in the forming.
Anyway, I think most would agree that the rally is near its final stage. Bears now have 2 straws: The US$ which could rise and the yield which could drop. These 2 factors could result in a bigger pullback of the stock market.
3.1.0 PowerShares DB US Dollar Index Bullish Fund (UUP Daily), this might be the most important straw for bears. It had a breakout today, rejected by MA20 though. So whether it could finally stand above the MA20 would determine the bears’ destiny. Pay attention to Euro (FXE) and Yen (FXY), they’re all at an important point now. The drop of the FXE and the rise of FXY are not good for the stock market.
3.0.0 10Y T-Bill Yield, Bearish Tri Star should be confirmed today so yield could drop further (means a flight to safety) which is not good for the stock market.
Futures look strong. A gap up is going to happen tomorrow by the looks of it. But upside is fairly limited. Maybe a move to 990 at most and probably a doji.
ReplyDeleteLet's see if it can break 982 area before we talk about 990 level. If Jobless claims are cooked by FED then of course market could fly to 990
ReplyDeleteMarketwatch says that the Dow theory indicates a bull market now... is that true? If so, how often is the Dow Theory right?
ReplyDeleteI don't know which Dow theory they refer to. The only thing I know is that the recent dow new high is not confirmed by transport index which according to Dow theory, the recent new high is suspicious.
ReplyDeleteYou can check Dow theory here: http://stockcharts.com/school/doku.php?id=chart_school:market_analysis:dow_theory, in Average Must Confirm, you'll find my argument is true. So my question is to which theory they refer?
Dear Cobra,
ReplyDeleteIs there additional supporting evidence for the Roof Top pattern? For instance a coinciding volume pattern?
Also, does today's action qualify as a distribution day? Maybe the accumulation in the last hour negated this but it certainly appeared as though we were headed for one.
Thank you,
-A.
Cobra, Thurs 07-30 is Trading Day # 21 for July, and seasonally biased to be strong:
ReplyDeletehttp://www.tsptalk.com/images/seasonality_july.gif
Also, Thurs 07-30 is my 3 wk cycle (likely pivot) date, likely turn UP from a Low on Wedn 07-29 (my bias seeing how the futures are strong pre-market), or possibly a High, depending on where we close.
Suspect that the 1000 level will act as a magnet.
Any recent shorts (new bears from past two days) should be forced to cover over 983-985 or so.
Could be the catalyst to get to 1000?
Thanks for sharing your work. Have a good day.
Regards, Jim P.
Shouldn't that read that a drop in BOTH FXE & FXY is not good for the market. As FXY rises so did the S&P.
ReplyDeletehttp://tinyurl.com/mw6pyv
SPX 1050 coming?
ReplyDeleteCobra,
ReplyDeleteI remember Uempel's note that 993 was resistance,..and (as of noon) that has worked fairly well so far today.
Put/Call ($CPC) ar .64 is on the light side,..perhaps a little too much optimism here?
Regards, Jim P.
Jim, if CPC close around 0.64, I'd be on the bear camp.
ReplyDeleteADD, about Roof formation, you'll find this site very useful: http://thepatternsite.com/
ReplyDeleteAnd about distribution, well, today should have answered your question. LOL
XMan, welcome back! Many are expect 1000 to be reached today, let's wait and see. I have no idea.
ReplyDelete07/30 - TRIN Data Dislocation Spikes Market:
ReplyDeleteyoutube.com/watch?v=5BPyvn-hu0k
Just what I wanted today; a big pullback after that test of sp1000. Now we're setup for a drop below SP 950 tomorrow. Shanghai will have another huge drop tonight and take the US with it tomorrow. Ideally, that first week of November should be fourth wave to a lesser degree and should hold as resistance as we now enter a crucial time-frame.
ReplyDelete----Mr. Panic
If you are correct Mr. Panic that would be a "B" leg down, assuming that we just completed an "A" leg up from 869. I believe that to be the case. It looks like 869 to 996 unfolded in a 5 wave move that probably ended today. A quick "B" leg down, followed by a final "C" wave back up to 1014 or so would complete the entire rally up from 666.
ReplyDeleteThat should be done by next Friday (the 7th). That's when I'm going extremely short! I expect the market to start turning down that following Monday and crashing on Friday August 14th! This will absolutely blow me away if it happens just like that. Adrian Fourie predicted it would crash on August 14th, 2009 back in 1996! That's amazing to me. Even if it's off by a few days, a crash will occur. And to predict it so long ago is mind blowing! I'm waiting patiently.
Dan Black
It looks like we completed 5 waves up from 869. That last half an hour drop was too steep for a final minor 4. (Kenny's blog is on top of things) Your scenario could play out; it's just that I think this week is crucial cyclically and the market needs to close below 955 tomorrow or its a bullish monthly reversal. The Shanghai Composite already had a big drop 2 nights ago and crude and gold are already heading down. I added more bearish ETFs at the close and I just want to be in here in case we gap down. (Island reversal?)
ReplyDeleteAround August 6th, I would consider entering puts possibly.
My research on solar eclipses surrounded by 2 lunar eclipses brought up some red-pillish results. There have only been 11 occurrences since 1900 with 2 years having two occurrences. Years like 2002,1998 were followed by hard drops in the stock market. One in early 1933 was followed by a bank holiday in the U.S. And of my brief study of solar eclipses in July showed that the stock markets tended to enter hard down phases following them (July eclipses=2001,2000,1991,1990,1982 and of course 1907). July 2000 was almost the exact opposite of July 2009, a nearly perfect lunar eclipse surrounded by two partial solar eclipses, (the only occurence I saw of two solar eclipses following each other in a months time frame) The SP500 made a high the following month (it was also the all-time high for the US market in terms of market capitalization) and preceded to drop 50+% into 2002. The other stuff I can't mention here but I see Adrian Fourie has hinted at similar conclusions.
Feel free to mention the "Other Stuff" to my email address... if you can. dan@danblack.com
ReplyDeleteThanks