Wednesday, February 18, 2015

Charts 02-18: Get dressed for the big dance

The waves are lining up for a top in the mid-2120s next week just before the final Greek double-secret probation deadline arrives.  With a plausibly-complete wave count and the upper Bollinger Band on the daily SPX within reach, it may be time to get our war face on like old von Mackensen here.

Anton Ludwig August von Mackensen

The short-term SPX count seems clear enough.  Waves 1 and 3 each took 4-5 days.

SPX 02-18

This gives us a sharp drop back to support at 1972 SPX, followed by a kissback rejection of the old 2-4 trendline and a harder fall to 1820.  

SPX 02-18 6M

Today's notes suggest that the Fed will NOT raise rates at the April meeting, bouncing us back up toward SPX 2000.  We must keep a very close watch on the yield of the 13-week Treasury bill during this period for clues that the Fed will raise at the June meeting.  There's another channel kissback/rejection opportunity around 1985 SPX.

That would drop us to the next level of support around 1530 SPX.  A crash in September would finish the 3PDH retrace back below 1100 SPX.

SPX 02-18 10Y

VIX is setting up well for a low against its lower Bollinger Band and a support trendline that has been running for a while.

VIX 02-18


christiangustafson said...

I would have made a joke on Heraclitus, but this is a family-friendly blog.

Anonymous said...

Excellent, VIX under 15 has been my sell signal for a while.

Phat Repat said...

I have got to get me one of them hats! ;-)

Playing to script, so far.

christiangustafson said...

Yeah, Mackensen is the Prussian ideal-type. I love the pics of the octogenarian Hussar in his WWI dress uniform surrounded by Nazis at the Kaiser's funeral. They look like Eurotrash headed out to a Kraftwerk concert.

Imagine how different our own Kultur would be today if George Washington was a bit more of a warrior in this mold instead of the statesman.

Imagine if the classic portrait of Washington had him with a necklace of British ears looped around his neck, how this would change who we are.

christiangustafson said...

Whoa, big traffic spike from the UK on the blog just now, about 500 hits in a couple of minutes.

Keyphrase "necklace of British ears" trip an algo or two?

Not seeing an HTTP_REFERER on the traffic. Very odd.

Phat Repat said...

Well, the context of the comment should be obvious so they need to tune them algos better. ;-)

Realpolitik forms the base of all motivations with ideology used as a cover to appeal to the faithful followers.

Not sure about George, or whether he was in the trenches, but he is human (man's inhumanity to man and all that). Aside from that, history is written by the pen of the victor. ;-)

Interesting view by Carl Futia; he's looking for 2200 over the next couple of months. Not seeing it myself but there is a cluster forming around 2215.66. Will have to see how things look if/when first ideal target achieved (probably a profit taking event for me, but we'll see).

christiangustafson said...

Short-term chart I posted last night had us wasting more time today and ending up at 2088 SPX.

The drop at the open to 2090 SPX may have completed this move for us. Which means we may have started 5 up in my S-T count. 4-5 days takes us to Tuesday-Wednesday and the mid 2120s.

The UK traffic continues -- over 1,800 requests and still going steady. Looks like a bot -- Windows, Firefox, no HTTP_REFERER provided. Of course with a bot or script you can provide whatever info you like in the HTTP headers.

Phat Repat said...

Ja, should the slow grind continue, system projects Thursday/Friday to achieve target. Which means I would likely exit on Tuesday/Wednesday. ;-)

As a swag, today's closing projection was 2103.08.

T.Berry said...

sticking with 2415 by year end. have not seen anything yet to change it. once greece out of the way it could be lift of time.

T.Berry said...

if we get to mid 2120's cg, that on a % basis would put the good old naz right near 5k. wonder if anyone still has their naz 5k hats- lol

christiangustafson said...

UK just turned the bot off. It had been running consistently all this morning, at about 45 req/minute, for a total of ~10K visits.

Odd. Not exactly a DDOS effort, just a sustained scripted series of requests.

Phat Repat said...

Like that optimism. ;-)

Well, that was a yawner of a day. Stop comes in at 2084.54 confirmed (EOD) with a reversal at 2076.86. Trend still mostly positive but 1 of 4 indicators has gone red. No sweat, yet.

christiangustafson said...

Hmm, strange. We had another round of obviously-scripted 10,000 blog requests out of the U.K. overnight, similar to yesterday morning's episode.

What does this mean?

Phat Repat said...

Next time go with French ears, that might be less controversial; at least for the British. ;-)

christiangustafson said...

SPX upper daily Bollinger is back at 2120, and it is leveling off nicely for us. Our target for a decent top is up there, with the upper trendline from the earlier highs in late 2014.

Now all we need is a wire article expressing hope for an 11th-hour Greek deal, or a sizable gap chunk down on the Yen, or some other nonsense. Yes we can!

Phat Repat said...

Or a resolution to the West Coast Port issue. Yes we can. ;-)

T.Berry said...

easier to be optimistic in bull mkts phat! my time horizon of minimum 15 yrs left in market at historical average 8% return puts the dow jones right around 57k. sounds like a big number but in reality isn't due to how long it will take.

greece & oil wreaking havoc however when chips fall they'll turn out to be a non event like debt ceiling, piigs, brics, ebola, isis, govt shutdown. another buying opp longer term

Phat Repat said...

If the system held together that long, I would be quite content; but I am dubious. As most bull markets go, however, they are always climbing the proverbial "wall of worry". Either way, I follow the little black box and it has worked out for me so far. ;-)

T.Berry said...
This comment has been removed by the author.
T.Berry said...

phat if the system (stock market i presume) doesn't last im not sure i'd want to be around :) . i really can't see that happening though.

from the looks of today's rally greece problem is pretty much done and out of the way. the sight of s&p < 2000 may be history.

T.Berry said...

phat, do you think a lot of money will come into us equities in march when ecb begins qe?

Phat Repat said...

Though I try to keep up with current events, and recognize there could be an impact to my positions (port resolution, Greek resolution, ECB QE, US Gov Debt, etc...), I strictly adhere to the signals given by my system. Live by the sword, die by the sword. ;-)

Good weekend to all!

christiangustafson said...

Hmm, looks like I don't have to hang my chart on a June FOMC rate hike after all.

The Greek agreement today, kicked the can right to ... June. Thanks, guys!

Not that everyone is going to wait until June to start moving toward the exits. Maybe as soon as next week.

pb said...

I don't believe that the Fed will ever raise rates - the economy is too weak.
The printing from the ECB will make it's way into our Stock Market and this madness will continue.

Trading Sunset said...

re: The printing from the ECB will make it's way into our Stock Market and this madness will continue.

Now that IS the issue for the next few years.