Stock Market Bulls Now in Control

The key level I've been citing has fallen today and so wave C down is complete and the bullish count above is on the table. The rally looks strong and impulsive, and also incomplete. I expect another 100 points added to the S&P before any meaningful correction may occur.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES 
OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

EURCAD Closed for 1/2 Position Profit of 130 Pips

Looks like taking 1/2 profits this morning was a wise choice as the EURCAD finished wave (iv) and almost immediately reversed and stopped my remaining position out at break even, but still leaving a nice 130 profit on half a position.

I don't want to enter any new positions on a Friday, especially after a big news report, so I'm done for the weekend.

Taking Profits on Half EURCAD

For EURCAD, I'm closing half my position with over a 100 pip profit and moving the remaining position's stop loss to break even at 1.4660. Also dropping take profit to 1.4830 which is only a little over 30 pips away.

Alternate S&P Count

Here is the alternate count that suggests wave C is complete and therefore the bulls have now regained control. This count opens the door to a major rally phase entering the market for several months.

S&P Hitting Resistance

The S&P is trading right at a key level that needs to hold for this count to remain valid. The jobs report tomorrow could send the market tumbling down and keep this count on track, but if it doesn't then a recount will be in order. Depending on the price action Friday, and the continuation Monday and possibly Tuesday, I will reassess what count would be the most viable. But for now, I remain bearish with the above count.

Going Long EURCAD

Long EURCAD at market (1.4660)

Take Profit 1.4850

Stop Loss 1.4510

Looking for a corrective 4th wave rally or possibly a resumption of the longer term up trend.

Bears Need a Top Soon, Good Place to Occur Now

The bullish triangle I called out in the last post on the 5min chart sure played out quite well, but much better, further and longer than expected.

Yesterday's rally was quite fierce and it made almost a straight line up.  Bear market rallies tend to be quite sharp, but this one is also very deep and can cause some problems to the bearish count if it gets above 1996.25, which is the wave ((i)) low.  The market closed right at wave ((iii)) 50% Fibonacci retracement level of 1951.

So, with the obvious follow-through to yesterday's sharp rally today complete, and a nice retracement level hit just shy of the wave ((i)) invalidation level, the bears could see a good opportunity to hit the market hard again to the downside either Friday or Monday.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&P Possibly in Short Term Bullish Triangle

The ES appears to be forming a short term bullish triangle that should result in a narrowing range of price activity probably the rest of the day before shooting higher in a terminal thrust towards the 1945 level.  Thrusts are terminal moves, so once complete, it should immediately retrace to at least the 1939 area.  To support the triangle outlook, you can also see volume waning as the triangle progresses.  My best guess is that overnight, or early in the morning for the US session, a news event will trigger the triangle's wave E and then a sharp move upward for the thrust will occur.  There is not much heavy news to cause this action, but that doesn't mean it won't occur, as many unforeseen events end up moving the markets sharply anyway.

For the longer term, I am still bearish as you can see from my previous post.


PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&Ps Finishing up Minor Wave C Down

My call for lower levels has certainly been fulfilled and the wave count down does not appear fully developed, suggesting at least one more attempt to the downside.  There are been two attempts to take out the 1800 support levels that have failed and resulted in over 100 point bounces.  However, one more downward move suggests that 1800 will be targeted again, and this time it will be taken out.  Once that floor is removed, I'll be looking at the 1700 level to provide support and perhaps put an end to the selling.  A rally about the 1970 area might negate the bearish outlook.  Until then, I'm looking for short term shorting opportunities, and right now looks like a good time to do it.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&P in Wave C Down

Looks like wave C is finally getting underway and has plenty of room to the downside.  Many of my momentum indicators on the 4hr and Daily charts are firmly down.  However, on a short term basis, 30min charts, the market is oversold.  The structure of the decline suggests further levels will be achieved before any meaningful bounce occurs so my bias remains bearish.

I drew some fibonnacci retracement levels for the move up from ((x)) to B to get an idea of where the market may pause and bounce.  I'm looking for around the 78% level at 1914 to conclude wave ((iii)), but 3rd waves can extend well beyond what's expected so by no means am I trying to get long there.  It's just an area I'll look to take some profits and perhaps lighten up some risk.

The trend remains firmly down as long 2090 is not broken, but preferably I'd like to see 2055 remain intact to keep the series of lower highs in place.


PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

GBPAUD Long (Forex)

If you look at the daily GBPAUD chart it is clear that the pair is in a solid uptrend.  The grind off the high at the 2.24 area is clearly corrective.  Price has formed a nice double bottom and is moving strongly and impulsively higher.  I see a clear continued move higher in this pair and like going long since the long term trend is up still.  If I'm wrong, look for a top near the confluence of Fibo retracement levels in the 2.1126-2.1518 range.  But I feel this pair could still move significantly higher.

When trading this pair, keep in mind it can get very wild so protective stops should be wide and therefore proper position sizing is key to proper risk control.  In addition, this cross can get really wide spreads up to 15 pips, so be aware of the time you trade it as the Aussie and London sessions tend have the widest spreads for this pair.


PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&P Rally Getting Tired?

It's tough to make a strong case against the S&P rally since it keeps defying all odds and floating higher and higher.  But from a technical analysis standpoint, I am skeptical of higher levels at this juncture.  The wave count is still consistent with a continued decline towards 1800 before resuming another strong uptrend.  This is contrary to seasonal positioning as the "Santa Claus" rally would be getting underway next week and would not support this wave count.  So I'm cautious on both sides ending the year and prefer to day trade this market and not swing trade at the moment.

One thing I have been watching is the action of the small caps (Russell 2k) relative to the overall stock market (S&P).  Up until a few weeks ago, the small caps were lagging the overall market quite a bit.  But recently, the small caps have shot higher and are attempting to close the gap.  I think that small caps still lead the way for the overall market as they are a good risk barometer, but still nothing tradeable here, it's just another thing to watch to keep you honest when trading the market.

Also, although the Nasdaq as a whole is keep pace with the S&P, major tech stocks like Amazon, Microsoft and Baidu are showing signs of exhaustion, which could be the early signs of a pullback as well.

Conclusion: I don't like this fractured market behavior and the apparent exhaustion of some major stocks that also can be seen as risk-appetite indicators.  In addition, the wave count off the wave A low is very corrective looking with its overlapping waves.  However, the market appears that it just wants to move higher regardless and it's tough to try and fight that trend. So I remain cautiously bearish, but am looking for only day trades on market indexes, and also for shorts in individual stocks such as Microsoft, LinkedIn, and Baidu.


PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&Ps Ready to Decline

Needless to say, I've been caught off guard by the extent of this rally and I keep trying to call tops and am getting hammered.  I don't see much gas left in the rally tank so I'm here again projecting a top, at least short term.  The rally counts nice as two 5 wave moves for rally waves (a) and (c) within ((z)), that should complete a very deep wave B.

I have propriety indicators that are very good at indicating overbought and oversold markets, and when price closes back within the overbought or oversold level, it usually marks at least a short term extreme.  Then a reversion to the mean occurs.  Friday's bearish close closed back underneath the overbought extreme, so a reversion to the mean of about 70 S&P points is likely to occur.  When you add that the decline also confirms severe bearish divergence on various momentum indicators you can make a strong case for a decline of significance starting soon.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&P Futures 1hr

This correction higher is going on way too long to keep calling it a wave ((iv)).  I simply analyzed and labeled the chart according to a price closing basis, where waves ((iv)) and ((v)) completed several weeks ago, completing Primary wave A.  This long choppy slop sideways to up since then is Primary wave B.  Which, by the way, should be concluding soon as it is possible to count the final rally higher as an impulse wave from numerous different perspectives.

Primary wave C down should get underway quite soon, perhaps as early as this upcoming week.  C waves are 3rd waves, and impulsive, so it should be quite a strong affair downward.  I'm looking to add to my short positions on a topping formation and/or strong move down on solid volume.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

S&P Futures

Not much to write about as the S&P's have been consolidating sideways for several weeks, waiting for the decline to a new low for wave ((v)) or 5.  It's certainly not pretty, but the count remains valid and the sideways chop can break down into a WXY combination correction, with the X wave being a triangle.

I still like the overall bias being down and for the wave ((iii)) low to be broken before any meaningful rally will occur.  So I continue looking for shorting opportunities for day trades, and holding short for swing trades.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.