Saturday, July 25, 2015

And on the Seventh Day, Karl wept ...

Karl Denninger's doomed BBRY continues to make new 52-week lows -- it's one of the stocks contributing to the three (at last count) Hindenburg Omen days we had this week, putting in sharp new lows while the momo tech stocks fly.

BBRY did touch its lower Bollinger on Friday, so it's due for a bounce, maybe another test of the $8 level before it continues its quest to worthlessness.  Remember that BBRY has only entertainment value for us in Deflation Land, it's a proxy for laughing at that consummate douchebag in the Florida who is shutting down his blog, gee, one of these days.

These memes are addictive once you get started.

Charts, it's do or die for anything bullish now.  My count still wants to see one more high, preferably in a couple of weeks around 2150-2156.  FOMC the big mover this upcoming week.

After another high, then we want to see the ending-diagonal finally break down, hard and fast.  UVXY ought to be at least a triple on this move if properly timed.

SPX 07-24 daily

This all leads, of course, to a fight over the 1820 SPX level that resolves itself as it should, with a complete meltdown of the equity markets and return to the trendline between the 2002 and 2009 lows.  These are the FAS-157 chickens coming home to roost.


Wednesday, July 22, 2015

Charts 07-22: Updated counts

Of course the top is not in -- I have us in "b of 5", correcting this last little rally.  Support at the 50DMA?

Once this correction is complete (this week), we then have "c of 5" left (as always) for that one last high.  If we can push through overhead resistance from 2135 to 2150 SPX, I think we could run all the way up to the true top of the ending-diagonal-since-October pattern, a real blow-off to the 2194 area.

SPX 07-22 1Y

After that, it's every man for himself, the devil take the hindmost ...


Thursday, July 16, 2015

What the bears need now

Equity bears need that magic ingredient -- a key-reversal day -- off the 2144 SPX area early in the session tomorrow.  

SPX 07-16

This would begin a direct drop back to support at 1820, completing in 3 weeks (imo).  It would be one helluva summer, and an autumn truly for the ages.

The upper SPX daily Bollinger Band will be ~2144 tomorrow, with the lower UVXY BB at $26.  We could see a 10-handle VIX on this move, at least until she rolls over.  We will want to see selling on heavy volume, and finish the day with a beautiful gravestone doji for the daily SPX candle.

A shift in the Greek situation would be the most likely culprit, suggesting that the check for the ECB payment next week might not clear.  

Perhaps Germany or even the IMF will blow up the ponzi at long last.

Monday, July 13, 2015

Can the Bulls trigger a hellish short-squeeze?

Well, can they?  Like, tomorrow?

Top of the impulse channel is 2135 SPX (new ATHs) by close tomorrow.  All they need to do is gap us 5-10 handles overnight over the 50DMA and the bears will take us the rest of the way.

SPX 07-13

This would of course set up the initial drop back to 1820 SPX and a fall crash according to the 1987 panic model I wrote about on ZeroHedge.  The sequence of "events" might be a little different, though, as I really really think Yellen will raise short-term rates at the September meeting.

SPX Fall 2015, 1987 crash model

Yes, this will be the greatest market crash in modern economic history.  And you are invited!