Monday, September 19, 2011

$SPX - Volatile Day

On the weekend I said this:

"My cycle analysis has been working very well in capturing the turn timing for major swings.  Weakness Monday may not last long because the cycle analysis looks very bullish starting later on Monday, and especially Tuesday."

"On Friday, price was stopped at the red fork line.  I suspect that a pullback here may only test the turquoise fork line, and then the rally may resume once again."

There was a strong bounce up from the turquoise line into the close as per the analysis. 

I'll size things up in the morning, but I think mkts could bounce strongly from a weak opening.   

15min Chart


  1. SC
    Thanks for the heads up.

    Can you throw bit more light on what you said before:

    "One other thing in daily price movement, price action should take the high out and fail which did not happen on Fri..........that bar was not a momentum failure bar, whcih led me to be teady to take profit and look for the higher failure leading into my date! " thanks.
    ??Does that mean, prices on daily chart ..... after taking out prev day's high, should fall below prev day's low = "momentum failure bar" ?

    Today Gabe, Sep 20 is one of your CIT dates from your Sep 15 post,
    (or they are dynamic, and changed already!)
    so strong down move from Monday continues,
    or reverses up today giving (?)CIT (even temporarily). thanks.

  2. Anon

    I am just saying that a key turn price most of the time makes a reversal bar of one sort or another …………that not happening with “time” not finished, lower time frame time was in, room on the swing chart to move into, bar count……….with all this in place a trader would take profit and look again. Yes I stated the 20th and then updated it to the 21 to 23rd mainly because of adjusting for the weekend and a cluster into a swing! I will be watching now when price takes out Fri’s high or attacks it for the next short setup! Good trading! joed

  3. The cycle analysis has been working like a charm!

    "I think mkts could bounce strongly from a weak opening."

  4. SC that was fantastic

  5. SC
    Yep, amazing that selloff near open also happened - as you thought.

    Here is the price near Fri highs, but Time is not up till Sep 21-23.
    So, are you building a short position, maybe half done ?

    Or 100% short now, because you think the drop is likely to be sharp and sudden, and will leave many traders behind who may be looking for a more perfect setup to Short into ?
    (Will you take a major position before the Fed announcement tomorrow? That is the question.)

  6. Hi SC and followers, yes I can also see the SPX continuing to rally into Friday up to 1230-1250 zone before starting a big move down with a target of 1050-1100. Then I feel we are going to have an end of year massive rally. How are you all reading this and what are your are your road maps. Look forward to hearing some views on where this is heading.


  7. Thanks, I am quite pleased with this method. I haven't had time yet to explain how this works, but I plan to do that shortly.

    I hear many saying this mkt is broken, or doesn't make sense. We had the Italy downgrade news yesterday, but the cycles still determined the bullish move today from my point of view.

  8. Yes, SC
    Kudos to your Cycles analysis, despite "Italy downgrade" and all else.

    When do you see weakness in S&P next?
    only next week, or earlier. thanks.

  9. Finally, I have the updated data for the cycle analysis for the next couple months. Wow, my jaw just about hit the floor when I saw how it looked.

    I'll get to that later, but first things first. Both RUT and Rifin have made lower highs from Friday with SPX testing the high. This makes me think we are not quite ready to move much higher just yet.

    There is room in the cycles for some cooling off late today or tomorrow morning. The rest of the week looks very bullish.

  10. Thanks for the charts SC!

    Want to thank you for the the charts and analysis..:-)

    And one more thing. You are really good to spot the short term wiggles in the market..Just amazing! :-)

    And if the rest of the week looks very bullish..Then I think its a high probability that Bernanke will give the market a surprice tomorrow.

  11. Keep in mind right now we are in a spot where could see large quick gyrations. A hard plunge overnight could be possible (not for sure) in my cycle work even though I am thinking bullish for the rest of the week.

    I am going to look closely at this possibility, and let's what signals develop into the close...

  12. Didn't have to wait long - Plunge! RUT looking ugly.

  13. SC / Gabe - thanks for your insightful analysis and excellent work. I am quite intrigued about Cycle Analysis but not alot of experience or expertise in this area....but I am learning! Much Appreciated!

  14. DD

    No one has expertise when they start.....don't be will have knowledge gained for a life time........welcome to the journey within! joed

  15. Gabe

    Is this the key reversal, a day ahead of Sep 21 to Sep 23 window, that you were expecting? thanks.

  16. anon

    Looks good so far...........4 drives against daily range on the 3 min and failed! When the window is coming I trade intra day towards it to catch fishing! joed

  17. Gabe

    Thanks. But you'll not go in 100% ahead of the window? Especially, with Fed tomorrow.

    (Full position, somewhere inside the window only ? - when you see the setup!)

  18. Weekly cycle peaks are holding it down. NDX is back under Friday's weekly cycle high. Benny better do something amazing to save this one, or we're gonna test my Aug 9th low.



  19. Great chart ZigZag! One thing I wonder is that last week we did see a significant low on Monday Sept 12th. Could the weekly alignment just indicate that low instead of Friday's high? Or does your setup interpret that last week should be a high? What do you think?

    So much movement happens in a day/week now it is hard to separate the pivot points sometimes.

  20. anon

    I do not trade or keep track of reports.......I do not trade fundamentals! I trade what is in front of me! I am short with a 15 pt cushion in the eminis and 3.50 profit in TZA! Good trading! joed


  22. Thanks SC! I'd feel better about it being a low if that week was red. The setup is saying it was a cycle peak last week with Benny as the wildcard. After tomorrow, things will become more clear.

  23. Thanks, Gabe
    Reading what you said above, is why I say you're an inspiring trader.

    Your cycles, they do not Invert. Trying to understand your methods.

    That is, if there is a 'Large selloff' rest of the week, after Fed tomorrow, that will not be explained by "Your cycles inverted".

  24. GLD DAILY UPDATE..............


  26. There are different methods with cycles that I use with different characteristics. In May/June/July there were time cycles that I was using with good success at catching the turn days. Those were pivot points, either high or low. I could usually forecast whether they were highs or lows based on my chart interpretation.

    Lately, I have been using my "cycle analysis" method, and more than pleased. I'll have more to say on this method, but it should never invert. There are times when the signal is neutral or just mildly bullish/bearish. In these cases it is not as helpful and making a market forecast requires more interpretation.

    When it hits moderate or extremes it has been incredibly accurate.

    For example, into Aug 9th was extremely bearish with a major spike down on that date. I had mentioned to expect a hard selloff into this date many times in July. I fumbled that trade because it was a clear signal, and the strategy should have been to simply short into that extreme date. Not a good idea to try to catch a bottom (or top) before an extreme. I would consider sitting in cash, but I will NEVER go against it heading into an extreme date.

    Using that system, Wed/Thurs/Fri are all showing up as strongly bullish. It is not a huge extreme bullish, but still quite strong. Not sure about tomorrow morning, but a rally into Friday looks likely going by this setup.

    Early next week looks bearish, but mid next week looks quite bullish again.

  27. SC
    Many thanks for your clear explanation.

    Earlier you used to post charts with a Cycle Line, that was like a Mirror image demarcation. The market development on Right (going forward in time) of the Cycle Line was in a 'rough SC-way' the mirror image of the market development going Left of the Cycle Line.
    Is there some reason you don't post those kinds of charts anymore ?
    To me they were quite helpful - in understanding the general trend going forward. For the skill was in where to 'draw' the Cycle Line - and that is your expertise. thanks.

  28. Hi All ! Do you think TZA:arcx can come back to level from end of 2008 if we are now in long term downtrend? It was over 2000$ per share. Now is 44.

  29. Anyone thi.ks silver is forming bullish pattern? any inteest lef for silver on this blog? if not please advice so i dont come here and waste mine and others time


  30. Gabe / SC:

    Do you ever trade around news events like the Fed meeting, earnings reports, etc., or do you rely solely on what the cycles and technical data is telling you?

    Gabe : Looking at you gold charts do you see that support is about to breakdown?

    Thanks to both of you for all your posts as they are both educational and very helpful.

  31. Stockboom, I'm still short Silver, but what do I know. Check out Kimble...

  32. info leaked on the boards, the same source as march-april - calling move to 47 silver within 2 weeks. crazy. DYODD and all.

  33. Gabe
    Are you expecting any bounce today, so far S&P low is 1193 ?
    If yes, how much? thanks.

  34. Thanks, glad you liked those symmetry charts. I found that analysis worked well in the first half of the year since it was basically a sideways topping mkt. Plenty of symmetry in that situation. Now it is more about the big picture, less short term symmetry. I will be showing that style of chart from time to time.

    I haven't been trading Silver on a daily basis lately so am not up to speed on the daily squiggles, but I am very interested in the bigger developemnts coming for the PM's as there will be a ton of action. So I have been waiting patiently for that moment! Let me see if I can show a few interesting points anyways.

  35. I follow fundamentals closely as they determine what happens in the long run. The mkt can bubble away from the fundamentals for periods of time, but not in the long run.

    Making profits is all about Price AND Time. The cycles are what determines the timing.

  36. Thank you SC and team ; i have small short position in silver will add more if it goes up

  37. kygold61

    "I do not trade or keep track of reports.......I do not trade fundamentals! I trade what is in front of me!"

    To me all of that motion is lagging to what I do or any accomplished cycle person does.......I am not talking about CIT dates....I am talking about doing a 10/20/30 yr forecast!

    My chart on Gold was to show it is sitting on support and that either way a trader goes the stop is obvious with the risk/reward! Thank you for your kind words! joed

  38. I am new to Cycles - any recommendation on how to educate (Learn the fundamental)?

  39. If the cycles were bullish today I would hate to see what the market does when they turn bearish.

  40. Great day for shorts! I hope nobody was long today.

  41. Daily and weekly cycle peak charts that I posted last week have worked like they should. The next buy area I see could potentially be the new moon around Sept 27-28. However, If we break below my August 9th cycle low we will likely crash.

    INDU cycle low chart:


    Just took out my shorts on the Emini from 1212 at 1152 in the night session.........closed TZA on the close today! Flat now! Nice ride! Good trading! joed

  43. Gab: Why did you close TZA position? Are you expecting a bounce soon and going to short again? If you expect a bounce, what time frame it will last? Thanks.