Thursday, December 18, 2014

How this all ends

Assuming we don't blow through overhead resistance and head for the stars, I'm still willing to entertain equity market-apocalypse here.  Keep an eye out for the 12/26 Bradley turn, could be a real doozy.

My SPY calls are up 300% so far, but I think they can be true 30-baggers.  Will let them ride.

Merry Christmas, enjoy the rally.

when the S&P finally dies

Wednesday, December 17, 2014

A bullish count and 2100 SPX are still possible

We have a legitimate 5-wave move off the market highs, with no pesky gaps in the tape that we need to fill, but the bear case is still open to the objection that these waves are not impulsive in form, not yet, at any rate.

We didn't see the more violent breakdown in the markets I thought we could.  Even with the excitement yesterday, we ended up drawing a five-wave decline that fits into a nice, tidy channel.

Here's a bullish count that puts 2100 SPX back on the board.  The still-untouched upper Bollinger Band on the SPX is up there now, taunting us.

SPX 12-16

Is Putin going to respond after Christmas?  The Western banking syndicate sorely needs more assets to financialize and securitize, in order to keep the great game going, and a major store of unburdened assets in the world is the great expanse of Russia.

Western finance could maybe squeeze another 10 years of life out of the Russian north, enough to get us through a good pod of Boomers.  The shark has to keep moving to live.

I'm excited to see what the statesman Putin has in mind as a response to our attacks.

Monday, December 15, 2014

Pay attention to the tape

from the Thirty Years War

Pay attention to the tape -- we're at a very important juncture here.  Not only did we turn down hard on an intraday rejection of the top of the megaphone since July, but the everything since the top has been very deliberate -- and free of gaps.  Did you notice today that the drop to 1982 was a perfect fib 1.62 times the first leg off the top?

We're setting up for much larger moves in 2015.  First, looking for us to wrap up the wave count with a 1954-ish low into FOMC this week, and a bounce into Christmas.

SPX 12-15

The larger count to return us to the 1080 SPX area over Spring, with 3PDH labeling:

SPX 12-15 3PDH

And a quick look at UVXY, which was instrumental in identifying the significance of our rejecting the old megaphone upper trendline.

UVXY 12-15
GLTA ...

Thursday, December 11, 2014

Good shot at a 4% sell-off tomorrow


Volatility spiked today after we rejected off the underside of the old megaphone going back to early July.  Tomorrow could see a 20+ handle gap down and flush.  The vols really were the tell today.

I do hope this is truly, finally, at long last the return of the Bear, because these moves would line up well with a real crash off the January FOMC.

SPX 12-11

Sunday, December 7, 2014

Season's Greetings and Bollinger update

Christmas in Deflation Land

It's the holiday season here in the PNW (and probably where you are, too), but the jury is still out whether we have a new bear market on deck.  We got our "one more higher high" per Bryan's model of serial highs going into historical tops, and now we are sitting up at the top of a parabolic move with no significant corrections.  Commodities and shit speculative credit ("high-yield") are in decline, and it's high time for the indexes to take a dive.

Let's take a quick review of where we are with respect to the Bollinger Bands on the various indexes.  At the moment, the S&P 500 is our lone holdout -- its upper BB was at 2084 SPX on Friday.  A few comments on the charts.


Blog regular and upright Illinois citizen Bicycle has been engaging heavily in fantasy bearishness lately, drawing trendlines to zero and other such nonsense.  OK, I'll play. 

Here's my take on the chart to OMG zero which includes my interpretation of Martin Armstrong's 2015.75 date for style points as well as shits & giggles.  Also, it's got fibs!  Eat that, Bicycle.

SPX chart to ZERO (hint: your brokerage is broke)

Tuesday, December 2, 2014

It's December and the Bollingers are in sight at last

the empty suit

I took a couple of weeks off to let the blown-out Bollinger Bands come in from their reaches, before we get back to the important and pressing business of calling tops in equities.

Besides the larger patterns, the key detail for us here is that we reach these extremes and react against them with great force.  The danger is that we do not, and instead follow them up for a while.  Take a look at some of the 3x leveraged ETF charts, and you can see long runs of this -- a very dangerous trap.

But it does open up some fun chaos into the end of the year and then the January FOMC.  We first need to see a key reversal day, say this Thursday, where the SPX swings 30 or 40 handles, with UVXY rising 20% or more.

Christmas crash scenario again

The VIX threw a pin through its lower (oversold) BB but has not reacted yet.  Ideally, it can close outside the band and then back inside, for a "VIX buy" (index sell) sign.

VIX daily 12-02