Sunday, August 31, 2014

A proposed "Bryan scenario"

Loyal reader and secret doomer Bryan chimes in with a concern about calling another top just yet.

I agree with gold. Separately, our last sequence of 3-5 and 5% plus corrections is one of those that requires another 3% plus correction that does not exceed 20% followed by a new closing high. Can we draw such a scenario?

OK.  Hmm.  I see.  Aw hell.

Bryan has brought this up before.  In the long-term history of important tops, there is always a sequence of new highs and lows just before the final top.  In his analysis, we still need another trick drop before "the pop" here.

What to do?

And I still would like to see a terminal pattern.  And still make use of the turn dates and broader structure of at least the larger (green-numbered) 3PDH.

So let us propose a megaphone, a classic broadening top.  In Bulkowski we trust.  The big 10/9 turn window then pencils out as a top for us, at about SPX 2026.  And we still get our touch of the 200 DMA, just before September FOMC.

Congratulations, Bryan, on following a blog with traffic so comically low that you can still get custom chartwork done for you on a Sunday afternoon.

SPX 08-31 1Y Bryan megaphone(?) scenario

The Goodwills I visited this morning were positively barren, I tell you, stripped and looted of anything of value.  I won't even bother with the big one in Rainer Valley again.


Bryan Franco said...

Thanks CG ... my wife and and 8 month old love that I spend my Labor Day weekend doing this sort of thing. But here in Ann Arbor, we don't really have the options you do to enjoy the great outdoors. So I just annotate my charts and build models. The life.

Christian Gustafson said...

Your proximity to the Sandusky, OH, makes up for a lot, though.

I like the megaphone here. Broadening tops are found at significant turning points. McClellan may have rolled over off its top, I have to see what McHugh has to say for his short-term outlook in his newsletter. IIRC, some of his indicators looked a little stretched up here.

If it is a megaphone top, than the "E" leg up should be fun.

Bryan Franco said...

Indeed! ... and where E up ends, the long-term E down begins for the Dow Jones Industrial Average.

Permabear Doomster said...

re: a blog with traffic so comically low

All of the finance sites are down.

Hell, CNBC has lost 65% of its viewership since the crash lows of 2009.

I don't know how the giant Zerohedge is doing, but I'd guess it is 30/40% down this year.

Ironically, one sign of a key turn will be when traffic stats go exponential...even the Cramer will be getting more than 2k viewers a day.

Bicycle said...

Net migration for Canada will fall to zero,

and net migration outflow for Mexico will stop completely,

and other assorted nonsense that I made up,