SPY - 1 Year Anniversary (from July 1st, 2010 bottom)

The target was hit today.  It is not a coincidence that the market strongly surged upwards into the 1-year anniversary of the July 1st, 2010 bottom.  It's a timing cycle due.

The turquoise fork line was backtested today.  I am suspecting a sharp selloff to test 1295 SPX or so next.  It might take the form of a mini "flashcrash".  July 6-7 may be a potential bottom.  A bounce back up from there to form a double top is favored using 3 different cycle patterns.    

I plan to show more detailed charts on the weekend.

Daily Chart

$Rifin - Financials Performance Gap

SPX rallied today (as shown on the following chart in yellow), but the Financials were flat.  One reason why is that GS has been badly slumping.  There was mortgage settlement news from BAC after hours so I will be watching the Financials closely tomorrow. 

In these situations Financials may actually pick up the pace and attempt to close the gap.  Yet, the underperformance is an early warning sign.  I've been targeting the 1315 area for SPX, and that still seems possible. 

I'll have additional details soon, but I am considering June 30th as a potential topping date for SPX with a decline to follow into late next week.  That would likely be a higher low.      

10min Chart

SPY - Fibonacci Fan

Interestingly, SPY has been finding support at the first orange Fibonacci fan from the July 1, 2010 bottom.  Notice how well the 2nd Fibonacci fan lines up with the lower turquoise fork line.   

4hour Chart

Silver - ST Target Hit

The short term target was hit today, and that can hold as a bottom for now.  Next, I expect some sideways trading with possible re-tests of near today's low. 

A small bounce back to approximately $35 is the next short term target.  However, it would be smart to be cautious as according to my patterns a much larger decline is nearing.  The main Red trendline was breached today for the first time, and that is a warning of a large plunge approaching for Silver.        

30min Chart

Silver - Update

On June 7th I said the following regarding SLV:

"Fibonacci fan supports at $35.25 were tested hard last week, and unlikely to hold on another test.  The main Red trendline rests in the low $33.00 area."

The Fibonacci fans were broken shortly thereafter, and the result was a steep selloff to the main Red trendline as shown on the chart below. 

The next short term target is in the proximity of the green arrow.

30min Chart

 

SPY - Timing Cycle Update

A major equal timing cycle was due today and that suggests a bottom.  We had a significant spike in the VIX today, yet markets held up very well. 

The Financials - Rifin put in a triple bottom with the first bottom last Friday.  The relative strength of the Financials Index has been hinting (for a week now) about an approaching upswing for the markets in the near term. 

Daily Chart

SPY - Timing Cycles Due

We have an equal time cycle due tomorrow as shown below.  We also have a different timing cycle due the following day on June 16th.  A cluster of cycles converging suggests whipsaws.  I have been leaning towards a high tomorrow and decline into the end of the week.

Overall I am anticipating a rally with higher lows to last into approx. June month end.  The larger trend remains down with a significant low expected in July.

Daily Chart

$SPX - Bear Trap

Friday appeared weak on the surface, but it is deceiving because the index close was only 6 points lower than the June 8th low.  Financials have been pulling down SPX, but capitulated on Friday with a powerful surge up late in the day.  The strong reversal in the Financial sector to the upside is a warning for bears. 

The low VIX is another warning sign, and in my view signals a relief rally to commence shortly.  I see VIX spiking up eventually as fear sets in, but not until later on (after a relief rally) during the "Freefall" phase.

Last week, SPX coiled up, like a spring, and I see this breaking up with a short squeeze.  The target is 1315.  Following the relief rally, a Freefall to the calculated 1239 target is anticipated.

I'll use 30min charts and my timing cycle charts to fine tune the smaller movements and timing more precisely.

2hour Chart

 














This is an update on my "2007 Top" cycle, and I've shown how it relates to our current trading patterns in the market.  I'll expand further on the big picture at a later date.

6day Chart

The Financial sector is approaching my long time target.  The timing cycle indicates a breather bounce is due.  Only a moderate decline in July is expected after a bounce.  Avoid shorting Financials!

4hour Chart

SPY - Major Support Level

Today we tested the white trendline as shown in my previous SPY charts.  I expect to see a bounce up from this level back to the proximity of the horizontal line on this SPY chart.  It would be about SPX 1315 level.   

Daily Chart

Silver - Fibonacci Fans

SLV is hitting up against some resistance levels.  Fibonacci fan supports at $35.25 were tested hard last week, and unlikely to hold on another test.  The main Red trendline rests in the low $33.00 area.  The Red trendline has already been tested twice. 

 

30min Chart

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4hour Chart

 

 

$SPX - Calculated Bottom 1239.26

We are approaching Bottom #2, and I continue to anticipate a bounce after Bottom #2, and then the final low at Bottom #3.  Lately, I have been showing the short term bounces on the way down using the 30min Charts.

Next, I will calculate the decline and target for Bottom #3:

I have a very specific cycle that strongly correlates with the current pattern of trading.  Calculations based on that cycle indicate that C = 1.382A.

A = 1344.07 Feb, 2011 high - 1249.05 March, 2011 low = 95.02 SPX points
C = 95.02 points x 1.382 = 131.32 points

Therefore Bottom #3 is calculated to be:

1370.58 - 131.32 points = 1239.26 SPX

The following chart shows that the Financials have been leading down since February with lower lows.  The glaring difference between Rifin and SPX (Yellow) clearly shows a bubble - about to pop.  It is not a matter of "if" SPX will breakdown.  SPX will soon catch up via a freefall with the weakness that Financials have already experienced for months.  I will show the timing of the freefall next. 

4hour Chart

SPY - "Flashcrash Cycle"

The dreaded and forgotten "Flashcrash Cycle" struck today like a bandit in the night.  Notice each time the market slumped for days off of a major high, and then finally plunged in dramatic fashion. 

In each case the plunge took the index down to near a bottom with sideways chop and a rally to follow.  I expect the same this time as well.  SPX probably has some sideways trade, with a little more to decline and put in a bottom soon, and then we should see another rally commence.

Last week we saw bottom Number 1.  We are now approaching bottom Number 2. 

Daily Chart