Sunday, January 13, 2013

A few more charts re a top

Couple of things I noticed this weekend playing around with the long-term SPX chart.

The weekly top Bollinger on the SPX is right at 1484; touching that would support a case for a top (a local top), if not the full case for the top.

SPX weekly

The monthly chart does not agree; its top Bollinger is way up at 1512.

SPX Monthly 10Y
SPX Monthly all
Here's an interesting periodic cycle, based on the 2011 high and low, that hits a number of inflection points in the long-term chart, and is about due.

SPX cycle based on 2011 high and low

There is one more thing I noticed, looking at fibs, a very reliable pattern since the 2009 lows.  Every time the market puts in an important low, it then rallies to roughly a .618 retrace from that low, back to SPX 1576.

Retrace from 666 low
Retrace from 1010 low
Retrace from 1074 low
Retrace from 1158 low
Rally from 1266 low
Rally from 1343 low
This last rally, up from 1343, has its .618 retrace right at 1486.  So we are looking forward to reaching the 1484 area on Tuesday, if the market gods will have it.

If the fiscal-cliff dip to SPX 1398 is one of these "significant" lows, then the .618 retrace from that is 1508, which could end up being our final final top.  1484 could mark an intermediate top this week, with one last rally up to 1508.

The 2007-2009 "replay" scenario would have us put in a low at SPX 1397 on January 29, which happens to be an FOMC day (and a Bradley turn, FWIW).  In terms of news, we could see the discussion on the debt ceiling get more interesting starting this week, with the market dropping just as it did leading up to the fiscal cliff, back to the same area on the chart.

The next big low following that is (projected to be) SPX 1314 on March 1.  That date could mark the peak of worry for this phase of the debt issue and the working out of some kind of stupid last-minute political deal.  

We'll see what we get this week.  Always completely speculative, and waiting again for a (the?) top.



stanley j g crouch said...

Really Good S#!t....Brilliant observation....the simplest are always the BEST...!! Great Work..!!

Christian Gustafson said...

Hey, thanks, Stanley.

You're welcome to swear as much as you need to on this blog.