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Monday, February 13, 2012

$SPX - Volatility to Increase

The following charts incorporate many important dates and events that have been developing in the markets recently.  Putting it all together has been fairly complex:

1.  Silver and Gold should dip for a few days, but then have substantial upside in coming weeks.  My large scale Silver pattern and Price/Time box pattern remain bullish.

2.  Apple should slump for a few days, but a parabolic move appears well underway, and there is nothing stopping it from completing a vertical parabolic move higher in the near term. 

3.  VIX has been increasing with volatility expected.

4.  The "Eye of the Hurricane" chart indicates Feb 27-28th as an important date.  It appears to be a low.

5.  The overall picture is extremely bearish.  

All of the events and timing can be explained with the following charts.  In addition, the symmetry and geometry are lined up as well.  Markets are ready to decline into the middle of this week.  However, with Apple going parabolic, SPX will still likely push slightly higher into next week before collapsing.  This configuration of geometry indicates upside to approximately 1363 SPX.

30min Chart















The market has been grinding up for a while, yet the overall picture is really bearish.

Daily Chart

169 comments:

  1. Today, tomorrow? It's close me thinks.

    http://tinyurl.com/7trqo47

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  2. I revised my forecast for precious metals : on Wednesday, gold & silver is expected to rise but since then they should decrease sharply until the end of the week !

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  3. What happened to 1280 ?

    Are you still short from 1340 a few days ago ?

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    Replies
    1. In 2012 I've posted 5 S&P trades. All 5 were wins for a total of 70 points.

      Yes, short at 1341, and plan to cover at 1328 soon. Shorts can then be placed on a bounce. Around Feb 27-28th targeting a low 1289 or so.

      Delete
  4. Hmmm, how significant is this for AAPL.

    One would have to say VERY much so!

    http://finance.yahoo.com/news/chinese-company-seek-ban-ipad-052403939.html

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  5. SC given your intermediate target for the markets in April being a lower low than last Oct, would you expect TVIX to make highers highs than Oct or given the makeup of inverse ETF's would you expect a lower high, ie 70's-80's?

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    Replies
    1. Point 3 to point 4 is the crash #1. The steep declines are anticipated to take about 4 weeks total. For this move I am targeting TVIX around $67 roughly.

      Markets bounce from point 4.

      However, my symmetry shows another crash #2 after this bounce. This is the one that will scare. Not because it is so deep, but rather it is so fast. VIX target on that one is in the 60+ range. TVIX should test $100, maybe even the $110 high from last year.

      Delete
  6. zigzag,

    your chart is one hell bullish....so do you not buy theory of crash in this market for next year or two?

    Thanks

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    Replies
    1. Hi Stockboom..I don't think we crash this year and we'll likely follow this pattern higher for this year. Next year is a different story. :-)

      Delete
  7. SC, I see you bought TVIX yesterday at $16.40. Are you going to hold it and if so, what is your short term price target to sell it? Yesterday you were looking for $18.90. Is that still the target, or you looking past that this week?

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    Replies
    1. SC, are you following the dollar index? If this is a significant bottom that we just had then your parabolic metals theory is not going to work out yet. My fractal projection from 2008 suggested dollar low on the jan 28th 2012 and rally into april 6-12 2012 for higher high. its taking its time but lets see if the turn is real and 81.8 is taken out.

      Also, on the recent COT commercials are reducing short dollar positions, which would support the rally.

      Delete
    2. I think we can see SPX approach 1328 next few days, so I am planning to hold TVIX until that level. Planning to look at the price targets some more today.

      Delete
    3. SC, what would you say regarding the idea that metals have not put in final lows yet? Is there a possibility in your symmetry work for retest of lows or lower lows for both metals going into april 2012?

      Delete
    4. Yes AM definitely, I've been saving that chart for Silver and Gold. I do see the metals pushing higher for a few weeks, but the bigger picture looks much different.

      I like to post the analysis relatively close to the turning points if possible. Those metal charts are coming later in Feb.

      Delete
    5. ..or let me rephrase this, perhaps what you saw as parabolic rise in metals in early 2012 - ends here. Your symmetry is not always accurate on price targets, just general pattern if im correct. Now, markets go into some kind of selling scenario until late march - early april, while dollar strengthens, then after this shake out in all sectors we rally per Zig Zags scenario into May.

      Delete
    6. My patterns are still bullish for the metals this month. I have confidence we'll see higher prices.

      March selloff, and also agree rally into May.

      Delete
  8. zigzag,

    Can you explain why your model projects the market going up per your projection up to May 12 ? After May 12, we come down hard ?

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    Replies
    1. Hi Timer..

      We actually end the year above the May high and peak out in late September, or early October. The early May area is where multiple cycles have alignment.

      Delete
  9. TVIX going wild. I think it may reach $18.25 or so, then see a decent pullback.

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  10. SC,

    USDJPY has a clear breakouta above its weekly resistance, triggering stops. According to MMA, USDJPY completed a 16.5 year cycle last year, so this is a brand new cycle. In the early phase of a new cycle, price will rise very fast.

    USD is now rising very fast against JPY. This implies that stock should be encountering selling pressure given the strength of USD.

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  11. so you see the SPX at 1363 approx by the end of the week? That might be the right time to enter TVIX or HVU...

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    Replies
    1. Dip into Wed/Thurs and then pop into early next week imo.

      Delete
    2. ok, got ya, dip to 1328 for the end of this week, and rise to 1363 beginning of next week, setting up the bigger drop.

      Delete
  12. On the SP500 futures chart, it now has a double looping (2nd times) crossing of the %K over %D in the over bought region. By day end, the signal will be confirmed if closed below 1344.

    This sell signal synch with the RSI(14) < 70.

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  13. SPX broke down through the red line and is backtesting it now.

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  14. SC; when are you going to post your charts on gold and silver my friend... i am keen on seeing them.. The miners do not appear to be doing well and the near future even looks bad... time to preserve some capital and buy on the weakness....

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  15. Wow. it's getting ahead of itself again. I wonder if it fills the gap around $19.05 now and then cools off.

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  16. I do think it'll cool off very soon.

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    Replies
    1. Agreed. Just sold. Thanks for your great trade ideas.

      Delete
  17. I'll plan to buy back in the $17's. This TVIX is like an elastic band right now. Wonderful to trade though often difficult to be precise...

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  18. Bought TVIX Monday $17.19. Sold TVIX $18.81. Will reload on the pullback. Do you have target for a pullback?

    Thanks SC!

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  19. I am looking at this now in detail, $17ish perhaps...

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  20. I think you sold too soon.....end of day will be better I think, these TVIX and HVU etfs tend to close near the highs....except last Friday of course.

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  21. TVIX may test today's high again, but my cycle analysis for SPX is more positive for tomorrow morning. Late Wed and Thurs looks negative. So this bodes well for TVIX coming down tomorrow.

    I'm even considering XIV for a scalp, though it is not particularly attractive. Mainly I want to accumulate TVIX on a dip tomorrow.

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  22. Generally I look for a significant move in TVIX, and the goal is to capture much of the move. Often I don't hit the tops/bottoms just right, but the real profits are in the middle anyways.

    Even more importantly though is to avoid risky spots as much as possible. Not losing is paramount, then profitable opportunities present themselves.

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  23. SC, it's an election year, and politicians are pulling out all the stops to get re-elected. Don't you think the Fed will come in and quickly implement QE3 once Crash #1 starts happening? The bounce off of crash #1 should keep going higher on the backs of massive amounts of printed money. Why do you think this will not happen?

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  24. Good points. Maybe the Fed implements QE3 at the bottom. The Fed may even need a selloff to justify QE3. In history, these things are done after the market moves, not typically proactive.

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  25. I wonder if we can still see TVIX at 17s next days?

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  26. It seems it could hit $19.60, but then still come down to around $17 again.

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  27. No, it's done, and coming down forget that $19.60.

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  28. Bought XIV at $7.97 to hold for tomorrow.

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  29. What is your exit price on XIV, and/or what is your stop?

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  30. Yes I agree the Fed will need to wait until the crash#1 plays out to justify QE3. But then the ensuing bounce may form a life of its own and we won't get crash #2?

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  31. For XIV $8.40-50 range. Feel pretty good about it.

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    Replies
    1. Nice call again. I didn't have the guts to go short. Will look to re-enter TVIX hopefully around 17.50 or below.

      Delete
  32. SC, i'm seeing april 3-4 as a potential market low, is that close to your april low date?

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  33. SC, are you still seeing lower SnP tomorrow/thursday?

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    Replies
    1. Yes Thurs 1328 looks possible to me.

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    2. You think XIV is a hold only until the morning bell then? Then to sell it?

      If tommorrow is negative, isn't holding XIV a bad idea?

      Delete
  34. Heck, I followed your move (thanks for posting it) and we are already at $8.20 XIV! You rock SC.

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    Replies
    1. Thanks, should have had more patience with TVIX again this morning, but XIV looking good :)

      Delete
  35. If we hit $8.40 XIV before the close will you sell and buy TVIX or are you hanging on till tomorrow morning regardless?

    Thanks!

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  36. If I could get $8.40 today I'll take it.

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  37. This market is just amazing. I won't doubt your xiv trade next time! Now where to re-enter TVIX.. Looks like it could fall to 16.60 if it keeps up.

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  38. I took it SC, thank so much for posting your trades. Shows that you are a great trader, and helps give confidence with your short and mid term cycles. Great day.

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  39. Ho Ho ...What the hell happened to DOW?

    This market is for sure funny...

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  40. I'm going to wait for tomorrow for TVIX. Yes, around $16.60 does look possible. I may have even sold the XIV too early, tomorrow may be better.

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    Replies
    1. nah, I like your approach. Identify your target and stick to it. That is the way to go. Eliminates some of the risk.

      Delete
  41. SC, I can't thank you enough.

    After taking profits on my TVIX trade I jumped into XIV far too early and had an uncomfortable few hours but patience paid off. Bought XIV $8.14, sold $8.40.

    Looking forward to tomorrow.

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  42. Probably TVIX bounces early in the morning a bit, then test under $17 after some consolidation.

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    Replies
    1. Hi SC

      You happen to have a target on this bounce in the early morning for TVIX?


      Thanks!

      Delete
    2. Hard to say for the morning. It might even come down lower first. It looks like it may bounce around in the $16-17 range for a while generally, but then break out and head higher to that $23.50 area I have been targeting.

      Delete
    3. So 16 to 17 ish range is good hold I guess till your target is reached?

      You dont see it break below 16 anymore?



      Thanks!

      Delete
    4. Yes, trade in this range from now with $16.50 or so being the lower end of the range probably not much lower, then break out fairly soon to the upside $23.50.

      Delete
  43. Bought TVIX in the aftermkt $16.89.

    ReplyDelete
    Replies
    1. how did you purchase tvix after market?

      Delete
    2. If you go to this link you can watch it trade aftermkt. http://data.cnbc.com/quotes/tvix

      Most brokers can buy it aftermkt, but not all. May need to phone and ask. Some have different fees for regular trading and aftermkt etc...

      Delete
    3. Lol I'm up 30 cents in the aftermkt now. Let's see how it looks in the morning.

      Delete
  44. I can always add more tomorrow. Will size it up in the morning.

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  45. VIX looks like it is forming a triangle?

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    Replies
    1. Yes, I agree it does seem to be triangulating. It may not be mature, but I think it'll break up.

      Delete
  46. SC, im starting to seriously doubt correction going any lower than 1275-1280 area. Did you see Atilla's $SPX chart with that trend line from 1994? there is a big chance now that it will hold as a support and we continue higher from there into the inflationary scenario.

    http://p.twimg.com/AjO2J-BCEAArLCk.png:large

    Overall its starting to look like a break out followed by consolidation in a bull market (inflated by CB's). Look at the commodities - DBC index broke out from the down trend, bull flag on the DBC is targeting ~39 from current 28. Oil is turning up on the weekly chart. Silver will sing in this what seems to be coming inflationary environment for months, same as gold. Look at the long term Gold / silver ratio chart, see the channel pointing down?

    Im thinking commodities are resuming the bull market.

    Whats is it 7-8$/gallon gas in europe now? I think we might see these prices very soon in the US as well. Oil may be next BIG play - when it goes to 150 or higher THEN we crash as the economy stalls. This may take a year or 2 to get there.

    Just thinking outloud.

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  47. s&p futures up 9%.....perhaps a strong open....hate looking back thinking i should have held! thats ok, will set up my next hvu entry.

    so sc, hvu/tvix tomorrow for the best entry? sell by weeks end?

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  48. China pumps the futures as we head towards the highest point on the February chart tomorrow. I'm guessing we might end in the red tomorrow, similar to the Bin Laden peak.

    http://tinyurl.com/7trqo47

    http://www.reuters.com/article/2012/02/15/china-europe-idUSB9E7MG01320120215

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  49. Replies
    1. How about HVU? What you think about it?
      Thanks! SC

      Delete
    2. Could see the $14.20 area.

      Delete
  50. Fingers crossed for TVIX. I reloaded today towards the end of the day. Can't buy after hours, so near $17. I hope Zig Zag is right about tomorrow. From the look of ES, that looks unlikely, which makes it all the more likely. Boy I am the ultimate contrarian!! :D

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    Replies
    1. Sideways and choppy for tomorrow probably, modest down day perhaps. Gap down Thurs looks likely, weak Fri also.

      Delete
  51. Hi SC,
    I just want to say Thank you very much for your work, especially telling us your Buying/Selling point, so I could sell mine right after you sold TVIX. That was really help me. Hope you could do this again for good next time. I really appreciated that.

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  52. I do think we have another high in store for us. When I examine the wave structure, I see another wave up very likely. Not by much, I think 1356-1365 or so. Maybe we even gap up and immediately top, then the rest is down :)

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  53. Tomorrow, 16 Feb, there is a F8(135.2025 cd, sqrt(21) = 4.583 moon cycles) and F6(83.4487 cd, sqrt(8) = 2.828 moon cycles) spiral calendar cycle due, pivoted from the 4 Oct and 25 Nov 11. Both of these two previous lows were associated with lots of emotions, thus 16 Feb should be emotionally linked with these two dates.

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  54. Even I will nibble short here..............but we are going higher after the correction.

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  55. I think big boys will take dow closer to 13k...cant imagine niow that they will not try that

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  56. Where do you see the correction going Ckorey?

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  57. 1300-1310............then higher.

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  58. 2012 had so much doom and gloom associated with it that it will turn out to be the best year in most asset classes in last 10 years. LOL

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  59. TVIX looks like it is heading for $18.30, then pause, $23.50 later in the week.

    ReplyDelete
    Replies
    1. Hi SC

      Do you plan to sell your TVIX at 18.30? or hold till 23.5 now?


      Thanks!

      Delete
  60. Will buy back $17.50-75. Not going anywhere near XIV this time...

    ReplyDelete
    Replies
    1. Hi SC

      still seeing TVIX will drop back down to that 17.50 to 17.75 range today?


      Thanks!

      Delete
    2. Yes, quite sure, but if I see $19, would have no choice but to chase.

      Delete
    3. Hi SC

      Holy crap, we may reach 19 soon SC, you have your buy setup already lol


      Thanks!

      Delete
    4. Starting to sweat a little lol!!

      Delete
  61. This is insanity. Look at AAPL!

    The CB's have created a huge error here. This will end so badly.

    Doubling my shorts here. UVXY and TVIX

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  62. Yes, Apple going vertical. There is still more to go in Apple, so even though TVIX flirting with a break out I am waiting for a dip.

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  63. Not long but still a chance of a rally here...........be careful.

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  64. Replies
    1. AHHAHA SC

      take off your buy for 19 lol

      Thanks!

      Delete
  65. Made my first ever full trade in HVU. Bought an extra 5000 shares during Monday's debacle @ $10.26 and sold them today for $11.43. However, when I look at the profit for that trade, it really pales in comparison to my fantasy for this play. Oh well, I have had many losers lately, so it feels good to register a gain. Thanks, SC, for your great guidance! My core I am holding from the mid $9 range, so I feel goodabout it. May buy back those 5000 shares today, too. Love this thread!

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  66. TVIX should finally cool off into the later part of the day. I think it'll blast off overnight though.

    Apple still has another $20 to go on the upside before it crumbles.

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  67. If we hold above 1341 look for 1370ish by next tues/ wed

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  68. We will hold 1341 I think, but do you think this still corrects to 1300 before hitting 1370 next week?

    Trying to play HVU right, and looking at when to sell it and when to rebuy it......probably sell if it goes parabolic, and buy it back before the end of the day.

    SC, whats your plan?

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  69. I'm in cash, plan to buy tvix later today in the mid $17 to hold overnight for a potential Fri $23.50 target.

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  70. XIV would have worked, but the potential gain was not that much, and frankly not worth the anxiety.

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  71. SPX 1326 area this Fri is my target.

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  72. SS76,

    No I think 1363-1371 by wed next week then we correct.

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  73. I think 1326 SPX, then 1363 next week. Then 1289 into Feb 27th.

    Chart above for SPX looks really close I think.

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    Replies
    1. Ok but it's OPEX Friday and I say we hold 1341.

      It looks like an ascending triangle that measures up to 1370ish.

      Not really worth playing here though as we are toppy.

      Delete
  74. Hi SC

    It doesnt look like TVIX wont to go below 18. Would you consider getting back in the low 18ish?

    Thanks!

    ReplyDelete
  75. Yes, lets move targets up and away. Then AAPL all of the suddden is holding above 500 ... we are dealing with the printing presses here and human greed, pretty fruitless task to short these two.

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  76. I may disagree with SC on levels but I think he may have the overall direction right in the short term so I would be cautious here on the long side.

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  77. Is there an inverse Nasdaq ETF? I'm thinking with Apple at an RSI of 90+, it will bring the whole nasdaq down as it drops.

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  78. Hi SC

    Are you still waiting for that 17.ish TVIX today?


    Thanks!

    ReplyDelete
  79. ckorey, without getting timing aspect right i dont trust the price targets. without correct timing these line are just that - lines.

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  80. There was no choice, TVIX can go parabolic again here.

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  81. TVIX may settle back a bit, and I'll add, but by my work it is already on the way up now with little to retrace. Passed the line in the sand imo.

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  82. It can blast off at any time today, or overnight at latest imo.

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  83. Apple selloff for a couple days, and the parabola finishes up next week.

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  84. Replies
    1. It could work for a small move, but make sure you have a stop imo.

      Delete
  85. Fed minutes come up in 15 min.

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  86. QE3 likely and so far 1341 holding

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    Replies
    1. QE3 is already in progress if you have not noticed it yet.

      Delete
  87. Oh boy, whipsaws. I am holding TVIX for $23.50. Regardless of how it bounces around, I see TVIX resolving up with an explosive move.

    ReplyDelete
    Replies
    1. That is awesome SC, can you please let us know the target for HVU as well in comparsion to the 23.5 for TVIX?

      Thanks!

      Delete
    2. awesome, setting my sell limit there lol, now can enjoy holiday lol


      thanks!

      Delete
    3. Sc
      With the push up today where does that put the retracement on s&p and tvix from 23.50
      And is a large retracement necessary

      I see a small 5-10 point from 1319 then down to1300

      Delete
    4. For SPX 1326 is what I am targeting same as the the 30min chart above.

      I have another update chart coming for TVIX.

      Delete
    5. SC, looking over the charts above, with last night ES high @1358 and RH SP1,355.87 today, do you think your sp1363 projection is completed? Or do you think we still have one more rally to sp1363 after a retrace to sp1326 area, before a bigger correction to sp1290? Thanks!

      Delete
  88. InvestBB, If I may answer, SC mentioned $14.20 as an equivalent HVU target.
    kevin

    ReplyDelete
  89. alexthered,

    We have to retrace to 1326 SPX, then still have another rally next week to 1363. A good confirmation is because Apple is too tired to continue right now. It needs a rest, but it has another pop left next week.

    ReplyDelete
    Replies
    1. Hi SC

      would you be buying that XIV during next week rally to 1363? or would you be thinking it safer to watch and buy the TVIX dip, assuming you sell your TVIX around 23.5?


      Thanks!

      Delete
  90. SC do you have long term QQQ/ nasdaq charts coming?
    DO you think the 09 lows will be taken out anytime in the next 5 years?

    ReplyDelete
  91. 1341 hanging on for dear life..........if it breaks then SC will have his 1326ish.

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  92. Indicators rolling over hard here and an inch away from a sell signal.

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  93. Once TVIX reaches $23.50, I'll switch to XIV. Yes, the long term Nasdaq charts are very interesting and coming soon. Very important to understand the Nasdaq as it is the key to the markets for next few years.

    The 09 lows won't hold, but first there are surprises, BIG ones....

    ReplyDelete
  94. How do you see the overnight and the open tomorrow SC? Trying to determine if I should buy HVU at the close, or safer at the open tomorrow?

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  95. I'm holding. TVIX could shoot up overnight, but not a guarantee. At this point my chart is really bullish for it.

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  96. there is a lot of money in FB IPO and timing is not an accident, they know it - hence chances are we rally higher after whatever bears can get here.

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  97. Hi SC

    you bought the same price as TVIX close lol


    Thanks!

    ReplyDelete
  98. Mixed..............1342 held but indicators are point down though not on a sell yet.

    Will give a few points to 1335ish and then I think we move up.........how high is a good question. somewhere around SC's 1363 sounds about right by tues-wed next week.

    ReplyDelete
  99. Lol, not exactly smooth trading on my part today. Turned a nice profit from yesterday, but had to chase.

    ReplyDelete
  100. Replies
    1. here you go guys, dec 10th 2011 - huge rally is coming, potential target 1360. out in the open of forbes, lol.

      http://www.forbes.com/sites/johnnavin/2011/12/10/the-big-rally-that-may-be-coming/

      now he is saying: "I would guess that some kind of sell off develops and that it’s short-lived because – as you can see on another part of the chart — the 50-day moving average is now pointing relentlessly downward and about to cross below the 200-day. After a temporary adjustment, it looks as if confidence is about to win out over fear for awhile."

      btw, we now officially have a 50/200DMA bear cross on the VIX. 50DMA is a resistance and VIX just got stopped at that level..

      Delete
  101. SC. If SPX dip this Friday and prepare a bounce for next weeks. Do you also foresee a dip on silver and gold and bounce into next weeks as well? Thanks.

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  102. Very impressed with your trades on TVIX SC.

    I'm a terrible day trader so I have been holding since the high 14's waiting for the mid to high 24's before I bail probably AM Friday.

    Once again well done.

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  103. Hello there im a Gann analysis from sweden. Maby you like my blog to ? http://guldbubblan.blogg.se/

    Have i nice night sky

    // Robert Leci´c

    ReplyDelete
  104. Thank you very much, I will visit!

    ReplyDelete