Wednesday, April 30, 2014

Charts 04-30: Back from the Arizona

I've got a ton of junk to post tonight.  Of course, since I left town with a completely wrong call, I should at least have the temerity to post a quick chart before today's FOMC announcement.

The wave 4 move we had been watching pulled up short at the 1814 level, possibly because RUT and the techs bounced off their respective 200DMAs.  So the S&P 500 put up this truncated sell-off, followed by a 70pt rally back to 1884.

While I was out hiking, we pulled back to 1850 and held support.  Add another 70pts to this, and we get a possible target for the SPX of 1920 around May 20.  See the chart below, it looks nice and proportional.  This will complete a giant ending diagonal from the 1646 low, which becomes the target for the first leg down.

SPY calls are expensive!  Look at the May expiry, the highest OI for calls is the 192s at over 200K contracts.  That's a lot of calls.  I bet they are right.

SPX 04-30 a.m.

8 comments:

Permabear Doomster said...

Welcome back.
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I can actually entirely go with that chart scenario, it is something I am seeking as a primary inter'4 down.

To be clear though, considering 'everything', I'm still seeking another stupid hyper-wave starting later this year, one that will likely last at least 12/18mths.
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As I even stated last October, worse case for 2014 for the equity bears...

a major down wave in 2014..only to be followed by a fierce rally into 2015.

Most of the bears would hold short, and get zeroed out.
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1897WasTheTop said...

Watch 1887.xx tomorrow for a reversal.

T.Berry said...

+1 on 1920 cg,,, your upside calls been on,,strong bull mkt helps,,,,,nice target to hit on the way to 2300 (bicycle's the man). janet like ben, looking out for bulls. no catalyst for any sort of pullback beyond 2-3% seen....possible once 1920 hit straight shot to 2k sp's??? 1920 a go down on way to 2200....kiss 1636 bye bye--low 1742 for year is in....don't see much red in near/intermediate future,,,,no to sell may this year,,,,sp's 15+% higher in 12 mo's

T.Berry said...

calling top @ 1920 like calling tops @ 1153, 1293, 1388, 1401, 1528, 1677, you get jist? lol

Christian Gustafson said...

It's a tough job, T.Berry, calling all those tops.

Someone's gotta do it.

Hang in there for my Fall crash call, OK?

sooner said...

I like you calling tops, keeps my hopes up!

Christian Gustafson said...

My friend Randy calls them "McTops", probably because they are cheap, disposable, and a little greasy. They will fill you up and leave you contented for a while, however.

Did anyone notice that the 1850 low on Monday confirmed the Bradley turn date over the weekend? They have been very good at identifying even minor turns lately.

The 7/16 and 11/20 Bradley turns may be very important later this year.

Christian Gustafson said...

.. which reminds me, keep an eye on 5/6 for the next Bradley turn, ja?