Wednesday, November 4, 2015

We need to see 2135 SPX by Friday's NFP release

... and that will set a lot of matter into motion.

Dürer: The Four Horsemen of the Apocalypse

2135 SPX is a marginal new high and the top of the current channel.  News-wise, it would be a pop into the NFP numbers released before Friday market open, followed by a sharp sell-off.

SPX December

A decline into December FOMC allows the rate hike to be "priced in" and for a nice bounce back to resistance into the end of 2015 and Q4.

This sets up January 2016 to be a great crisis and disaster, as a head & shoulders off the 1737 neckline plays out.

SPX 2016

21 comments:

Christian Gustafson said...

If this plays out, one of you will have to go looking for me off in the wilds of the Pasayten or beyond this summer.

With enough time and effort, I can shake off all the bad habits I've picked up in civilization, maybe forget language altogether, regress to a pure primitive animal state.

Christian Gustafson said...

I guess the real test would be that if I were trapped, caged, and dragged back to civilization, that I would not only fail to recognize my own children, but that I would try to eat them both.

Be very careful unwinding yourself from the great machine.

scott said...

Curious CG how you decided that was a channel on your chart that indicates a higher high?

I've never seen a channel drawn like that with no relationship to price...

As best I can determine the daily (and lesser time frame) pattern is a bearish rising wedgie. Also on the daily there is a Money Flow cycle top that coincides nicely with the end of the wedgie.

http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&st=2015-05-29&en=today&id=p12443087258&a=406333442

Other confirmations that time has run out for the CB October magic trick

http://stockcharts.com/h-sc/ui?s=%24BPINDU&p=D&st=2015-06-01&en=2015-11-04&id=p99711946611&a=426074268

http://stockcharts.com/h-sc/ui?s=%24VXV%3A%24VIX&p=D&st=2015-06-18&en=today&id=p63058549804&a=429622149

http://stockcharts.com/h-sc/ui?s=%24VIX&p=D&st=2015-06-26&en=today&id=p06388696940&a=428878359

Christian Gustafson said...

Well Scott there is the top trendline overhead on the SPX, which is at 2135 early in the session Friday.

2135 would give us a marginal new high, so we can bag all of the crap from this summer as a "wave 4" and not be on the on the hook to make Elliott sense of it.

Furthermore, I mentioned earlier that I thought that if we are in a (final?) 5th wave up, that it corresponds to a sharp wave 1 that went from 1158 to 1422 SPX, a total of 264 handles.

If we add that 264 to the recent 1871 low, it gets us precisely to 2135 SPX. So I think that's a swell target.

Team Winning said...

2135 IT IS......SOLD TO CG :-))))

BACK IN SEPT I TOLD YA WE WERE GOING TO GO BACK UP......HERE WE ARE!!!!!

Christian Gustafson said...

I tell ya, Winning, the LLD /ES on August 24 was the worst thing ever for the bears.

Hope you cleaned up with SPY calls.

Christian Gustafson said...

Pebble has some excellent commentary on the current rally in equities, particularly vis a vis USDJPY.

T.Berry said...

one impressive bull mkt. i'm not sure about buying puts when we get to 2135. too much strength even after 1800+ point dow run up from oct 2 lows. any pullback won't last very long and i don't think i could time it. too easy making on the long side

Bill Bober said...

CG, do you still think there is a chance we could get UVXY into the teens?

Christian Gustafson said...

The daily lower BB for UVXY bottomed in the high teens and has risen into the low-20s, which is encouraging. It should provide support, particularly if we get a capitulation day for volatility.

That said, if the bearish case fails to emerge soon, then Bollinger Bands are no guarantee at all; UVXY will simply ride them down until its next reverse split.

The ETF is designed to go to zero, again and again. It takes guts and discipline to play it long.

UVXY is also very valuable as an indicator intraday. It did not show any panic as the SPX plunged 18 handles this morning. It would have spiked up and held its gains if the markets were in any real trouble.

Christian Gustafson said...

Hey, Bill --

Keep an eye on the daily BBs for the VIX, too. They are tightening, and the lower one isn't that far away.

One of McHugh's favorite directional signals is a close outside the daily Bollinger on the VIX, followed by a close back inside. This will generate a corresponding buy or sell signal for equities, as volatility heads in the other direction.

Christian Gustafson said...

And don't forget that a perfect 2138 SPX is still overhead.

(1576 - 666) * 1.618 + 666 = 2138

Maybe we have to reach this target ... just because.

ruff times said...

So in essence, become human again. How refreshing

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

weird even after near 2000 point move, vix still 40% above the years low... feels like dow has a lot more left to go much higher now. wouldn't rule out a strong move up today. will we get to new ath's today??????

Christian Gustafson said...

11/18 next interesting date - new highs mid channel. UVXY sez no fear this morning, just some wave 4 chop.

T.Berry said...

be curious to know what the next target after 2135 gets taken out--- can we get to 2200 this year???

scott said...

SPX won't see 2100 again until after 2020, let alone 2135 today.

Breaks of all the rising wedgies are clear on all time frames. The Money Flow cycle is going to push price down regardless of bulltard mythology.

CG, that upper "trendline" you reference is just a topping fractal that has no relevance to projections. Price at this stage of the cycle always rolls off real upper trendlines anyway and never completes any projected target.

I was asking how you formulated your rising "channel" as it seemed constructed to validate your price target rather than based on price history.

Anyway, all roads lead down for now.

http://stockcharts.com/h-sc/ui?s=RSP%3A%24SPX&p=D&yr=0&mn=5&dy=0&id=p61886913778&a=402712895

http://stockcharts.com/h-sc/ui?s=%24NYHLR%3A%24NAHLR&p=D&yr=0&mn=5&dy=0&id=p19149338771&a=427967638

http://stockcharts.com/h-sc/ui?s=%24NYA&p=W&st=2012-11-22&en=today&id=p96283418106&a=429428877

http://stockcharts.com/h-sc/ui?s=VXX&p=D&yr=0&mn=7&dy=0&id=p77890397600&a=346065104

http://stockcharts.com/h-sc/ui?s=%24NYHL&p=D&st=2015-09-02&en=today&id=p79218943495&a=430589665
There are big whopper sell signals lining up on the weekly and monthly charts - being confirmed now by daily...

T.Berry said...

you're right scott no 2135 today. oh well it'll get here soon enough. has to in order to get to 2,400 next year! :) the strength of this market is really amazing. after nearly 2000 points in a month the dow is up again today. this is a once in a lifetime bull market.

scott said...

T.Berry muy loco en la cabeza!

Enjoy your sleigh ride

down

hill!

lol

ruff times said...

FWIW,

The Brazilian Real is bid today. What a f'n joke. Have at it wankers