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Wednesday, July 25, 2012

$SPX - Positive Short Term Cycle Underway

The low appears to be in place from the previous negative cycle, and now the positive short term cycle is underway.  The target is above SPX 1380 on this positive cycle.

It will likely be an "erratic" move up in a stair step fashion with dips along the way. 

30min Chart

140 comments:

  1. SC, it seems like we're breaking down. DO you think we should start accumulating UVXY or do think it will retrace for sure? Thx

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  2. Yes, I see it topping soon and retracing deeply afterwards. UVXY is testing the range shown on the chart shown over a week ago.

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  3. SC, just curious, whats your confidence (%) levels that UVXY will reach min target and max target?

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    1. I'm very confident in those targets. The targets are solid, and the only challenge left has been the timing. This is because of the whipsaw phase we are currently experiencing in the market.

      Yes, the process has been slow as we continue these whipsaws, but at the same time the market is quickly running out of room to maneuver.

      One final bounce for the markets, and then over the cliff.

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    2. Mid-Sept is my timing for the maximum target. It has required patience but this timing looks to be correct.

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  4. SC, Do you believe UVXY could go down $6.5 again and even lower? Based on your chart, it looks like SPY would be lower high then the last peak. If you think it could happen at the end of next week (8/3) or next next week (8/10)?

    Somebody expects VIX could go lower 12-13 then boom up.

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    Replies
    1. Yes, now that it has spiked, UVXY is likely to retest that level and probably a little lower.

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  5. If this is supposedly going to step stair to 1380, that would be good for volatility, hence for for HVU and UVXY.

    Or you are confident in your targets, why not buy HVI for 10-15% gain ?

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    Replies
    1. As SPX rises, volatility will decline, but it will be choppy.

      I may go long S&P or XIV (or both). However, I'm not an advocate for short term trading in this environment because the large play is what is important and the focus, not these daily gyrations.

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  6. plot your highs and lows folks....moon dates...8-1 full...8-17 new...8-31 full...9-15 new... 9-29 full...the last two should be a bottom of sorts...many stock yearly highs in march and Gann 180 degree time frame is Sept.

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  7. Hey SC,

    I was just wondering, how do you think QE3 will affect UVXY? Wouldn't QE3 prop up the S&P, causing UVXY to drop?

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    1. It depends on the circumstances and which time frame. Are you referring to next week?

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    2. Well, I was just referring to the general scheme of things. If QE3 is enacted, how do you think that would affect your predicted price targets?

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    3. There are economic reasons that make QE3 more likely now than it has been before.

      Say the Fed wants to go ahead with it, and do it soon (well before the elections), then I would think the market would pop short term. However it would not change my targets, or the fact that I think a bear market is looming.

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    4. Understandable, so if something like QE3 were to come along, the only thing that would be affect would be the time frame of your price targets?

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    5. I don't even think it would effect the timing of the targets. Right now we're in a positive short term cycle so I am expecting the market to pop anyways. If QE were to occur that would fit well with the positive cycle topping. Once this positive cycle ends, then it is a much larger negative cycle that begins in August.

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  8. Hi SC,

    What do you think about gold & silver?
    The last move can be fake or it is a beginning of real rally?

    You keep saying "they are still acting choppy side." but maybe your thoughts could change after this move up. if you think consolidation is over for pm s please let me know.

    Please share your ideas and interpret the last move in gold and silver.

    Thank you so much.
    RB

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    Replies
    1. This may finally be a real breakout for Gold/Silver. They have been consolidating, but watch closely here because the recent quiet period should be followed by a decent move up.

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    2. SC, this is not trading like you described at all. Metals are not running on fear but rather rumors of QEIII. The same for stock market. One word - Liquidity.

      Tomorrow is major Bradley turning point, if this is a turning point for risk/hot money then your "CRASH" is going to get postponed again, after elections perhaps.

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    3. If you go back and look at last July 2011, Gold rallied well in July and continued in Aug. Gold may start this rally on liquidity rumours and finish on fear. Same as what we saw last year.

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    4. Gold silver ratio is not confirming this rally so far. In july 2011 gold rallied on falling ratio like it normally should in the inflationary environment.

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  9. SC, what's your minimum and maximum target for $VIX in the coming Big Drop? Because not surprisingly, the $VIX and $UVXY charts look very different on a longer time frame.

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    1. I'll probably have some charts coming for the VIX itself. The area to look at is the 40 range up to 63.

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  10. So according to the cycles, a possible slow rise up in Aug and then acceleration in Sep?

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    1. VIX is near bottom. Once the bottoming process is complete in early Aug, then it should start to rise gradually first, accelerate up in the second half of Aug, and finish mid-Sept.

      The market looks weakest in the second half of Aug and up until mid-Sept in my cycles. After that is poisitive again.

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  11. SC, are you looking to sell all your position at first target or sell half at first and half at second. Thanks

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    1. My plan is to sell all at the first target because I think it will retrace from that level. Then I will review and look to reload and position for the second.

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  12. Wait a minute I thought you sold your UVXY last week ?

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    1. Yes, waiting to load up when the time is right.

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  13. SC, are you looking to buy UVXY when this pos cycle ends or looking for a price target like when it retest the low?

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    Replies
    1. I think this positive cycle has a ways to go first. So basically waiting for that, and still early.

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  14. So you see the bear cycle ends in Sep or just a temporary bottom before the next leg down?

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    1. Just a temporary bottom. My work suggests 3 legs down in total. The charts are coming soon with the lower targets.

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    2. So if it's a temporary bottom than wouldn't the max target be reached at the end of the 3rd leg?

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    3. Probably not, because the sideways moves in between each leg are going to equate to a lot of decay. For that reason I'll look at each leg seperately.

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  15. SC, some cycle analyst are saying whatever direction we head into Aug 9 will be reversed from that date...does this correspond with your cycle?

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    1. I do think that is an important time, and probably a turning point. There are other dates I am looking at during early August also. I'll do an update shortly.

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  16. cycles appear to be lining up for you SC...Nice work

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    1. Thank you. These whipsaws are interesting, but I'm also a firm believer that a much larger move is right around the corner...

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  17. VIX nasty falling wedge hugging the upper TL usually breaks down so my best estimate is we see 16 again fri/mon time.

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  18. Hi SC

    wondering if you have a forecast for next week in term of if it is a positive or negative cycle?


    Thanks!

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    1. This positive cycle can continue for a while into next week. I think there will likely be some dips along the way, but still positive overall.

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    2. Do you see the whole next week is positive or just early next week?

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    3. SC:

      To me it looks like UVXY is back-testing the breakout from the descending triangle, which is EXACTLY what it did in May after initially spiking, and then spiking big time.

      You were very patient on the way down in June/Early July, but you are even more patient waiting to load back up -- confusing. Aren't you slightly worried you might miss the boat?

      -Bicky

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    4. SPX seems top heavy here, so may dip soon. However, I still think it is heading higher next week. There are mixed spots next week, but overall still positive.

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    5. Not worried about missing the boat because my work shows that when UVXY is ready to go for real it will rise gradually to start. It still seems early.

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    6. Are you going to wait for confirmation of a bottom before entering, or are you trying to hit the bottom?

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    7. I'll try to hit the bottom, but that is always much easier said than done. Probably I'll start to scale in once it seems close. Even if I am a little late I can add as it starts the gradual rise phase.

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    8. I am truly a fan of the scale-in approach, as I've indicated many times.

      To me it seems like today is a good day to layer in (3/10) of an intended (10/10) position.

      Timing the bottom on these monsters is very very difficult.

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  19. SC, on the graph above, the purple line is around 1375, no?

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    1. 1377 today. There will be some resistance but likely to break out above that next week imo.

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  20. SC, do you think we break thru last weeks low on UVXY?

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    1. Yes, I do. UVXY may be about due for a small pop though.

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  21. SC, how low do u think UVXY can get, any targets?

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    1. It could pop soon, but ultimately $5's looking likely.

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    2. wow, $5 at the end of this positive cycle, so that means next week?

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    3. Next week should be interesting. We'll take it one step at a time. I think the market will dip a few times with false starts before finally topping.

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  22. Are you going to wait until after the Fed meeting to start buying UVXY? UVXY and $VIX tend to bottom before the market finally top and reverse?

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    1. Probably, but the market is looking quite toppy here for the next few days also.

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  23. what do you think the chances are that they will try to push this up to 1400?

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  24. SC, thanks for calling this move up, i cashed in half my position on my XIV and SSO. Keep up the great analysis.

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  25. Chances are high SPX heads up over 1400 though I expect dips along the way. However, UVXY actually is holding it's low from this morning quite well. Interesting...

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  26. SC, we told you all the way there will be no crash and we are heading to 1425. you never believed. here you are forced against the wall to call move above 1400.

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  27. DOW UPDATE

    http://img266.imageshack.us/img266/8867/dowr.jpg

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    1. Hi Joed, is it possible for you let us know what we suppose to look for with this chart of yours? confused

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    2. InvestBB..

      I had a few emails as to an update to my last chat and cycle which is below.....just an update to the original! Best, joed

      http://imageshack.us/photo/my-images/24/dows.jpg/

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  28. SC, do you think today may be a good day to start accumulating UVXY?

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    1. I am on high alert for the gradual rise phase in UVXY. The fact it didn't even manage a lower low today sure makes me take note.

      I do think there is more to rise for SPX, but UVXY is starting to look interesting.

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    2. Can you advise us when you place your first order please? thx

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  29. SC, does the cycle remain positive for Monday?

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    1. Yes overall we are still in the positive cycle. Though there can be dips on a given day.

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    2. It could be as soon as the early part of next week. Difficult to be exact because the timing can come in early or late. I am interested to see the next few days of action as there are other methods I use to determine when the turns is occuring also.

      Starting to get interesting....

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  30. SC, is there a way I could contact you directly? I'd like to ask you about something I'd rather not discuss on public forum posts. Thanks...

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    Replies
    1. Sure, email me if you like.

      cyclicalanalyst@gmail.com

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  31. Have a good weekend SC. Look forward to your analysis during this interesting time.

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  32. SC, do you see 1400-10 should be the max target for this final bounce? Thanks!

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    1. I am going to review the pricing in greater detail since it is getting close. This whipsaw period is nearly complete. The top is near in both time and price. There are specific patterns I am watching for early Aug, and I have an update coming with important events and timing for August.

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    2. Thanks, SC. Do you see this whole whipsaw up move is just a wave 2 up as the Big down move has already started the end of March this year?

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    3. The bear market has been underway since the top on April 2nd at 1422 SPX.

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  33. Hi, SC, will be waiting for your update. I see VIX broke out of the big falling wedge with that pop and now just backtesting.

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  34. SC, any negative cycle dates you see for next week?

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  35. SILVER

    http://img577.imageshack.us/img577/3707/silverdaily.jpg

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  36. I'm working on a detailed update for this week and the rest of August. It is a mixture of positive and negative this week in my cycle analysis. It's going to be choppy and tricky with some false breaks in both directions imo. I'll be looking for a top shortly, and start to decline this week.

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    1. SC:

      If the top is coming shortly, does that mean you will start a UVXY position shortly?

      Are you going to layer in this time, or go for another all-in at the appropriate price level?

      Thanks,

      Bicky

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    2. I may start accumulating UVXY as soon as today. We'll see. Probably I'll layer in with 2 or 3 blocks.

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  37. SC, I know you mentioned mixed cycles this week, but I am just curious what you see for Thurs and Fri, after the Fed? Thanks!

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    1. My preferred scenerio is that SPX can top early this week, and then start to decline. The middle and late week are mixed. So the market may already be in decline at that point though a lot of chop with the mixed cycles is to be expected.

      We'll see how it unfolds.

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    2. As of today the short term cycle still is positive.

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  38. I'm now short, but not with HVU, rather HSD.

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  39. SC, have you bought any blocks of UVXY yet?

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    1. When does the current positive cycle end?

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    2. It could be as soon as today, but these cycle can come in late also. I'm going to give it a little time here.

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    3. It is amazing how cautious you are here given your own up cycles are ending...compared to *bet the lot* approach at 12 because upside too great to be missed. I say buy your first block.

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    4. It's been a slow process so therefore that requires patience.

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    5. Well said..With VIX it's always a test of patience...!

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  40. This might be a head fake...

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  41. SC, is this the small pop on UVXY you said on Friday and we drop after this?

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    1. UVXY has been holding well since Fri morning. Not really expecting much downside. We'll see. There does not seem to be a sense of urgency from my point of view just yet.

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  42. SC, do u think this is the gradual incline stage or do you think we head back down toward the lows in the next few days?

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    1. I am watching closely for the gradual rise phase. Since Fri morning it looks similar to what I want to see from my pattern. However it is a little early. 1 day doesn't make a trend. It's a waiting game for now.

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  43. Why is VIX up 2.5% and HVU only up 2% ? (it should be x2)

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    1. actually HVU is a triple so should be x3

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    2. HVU is a double, not a triple. And it does not attempt to replicate the VIX - rather, it replicates the VIX short-term futures index. VIX futures can diverge substantially from spot VIX. You should always check the near-month futures before concluding that the ETF is not correctly replicating the performance of its underlying.

      In general, net asset values of these ETFs/ETNs do a pretty good job of replicating daily moves in their target indices. On occasion market values can diverge from net asset values, as happened with TVIX a few months ago.

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  44. Hmmm, thats strange as on Friday after the market close, it maintained the same level. odd, but when it goes down, it seems to always be in sync. I've decided that when i want to short the SPX, I use HSD or SPXU, they seem more accurate on a daily basis and it is a direct correlation with the SPX movements where as the VIX futures are not.

    When I think the market will rise though, I will be in HVI, particularly after a spike in VIX futures. That is my strategy and I am sticking to it!

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  45. DOW.............

    http://traderjoed.blogspot.com/

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  46. Hi SC:

    Great call on the retrace.

    I am still curious as to why you haven't dipped a toe yet. To me, it would seem that you really do believe we will see see prices in the low 6's to high 5's later this week.

    Are you seeing some sort of blow-off developing in the next couple of days?

    Or, are you not worried about capturing the bottom and are more interested in investing heavily once you've got the appropriate "long" signal based on your methodologies.

    Cheers,

    Bicky

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    Replies
    1. I've been waiting, but it is looking quite firm. The market may still manage to pop. Partly I have wanted to see the gradual rising trend develop, and that could be occuring now. So I be will likely step in soon.

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  47. SC, are you going to do an update soon? Thanks!

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  48. We're in a holding pattern for now. The market may manage a small pop, but resolve to the downside this week.

    I've been watching and waiting as it has been quiet.

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    1. SC, do you see UVXY now in the gradual rise phase or you see better entry price coming?

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    2. That phase may have already started.

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    3. Couldn't help myself...

      Picked up (2/10) at 7.40. Would love to see it go lower for the remaining (8/10), but couldn't live with myself if I didn't start a position into the latter half of this week.

      -Bicky

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    4. no worries...bottom picking is not the goal (it's just a bonus) but getting the majority of the trend is the goal. glta.

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    5. bicky

      why arent you waiting? you seeing something bad about to happen?


      Thanks!

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    6. InvestBB--

      The way I've charted UVXY it's already bounced off the falling wedge and may not test it again (or it may and I would be happy):

      http://www.freestockcharts.com?emailChartID=c741a08e-6888-4e4e-8a3f-b18ba2f23143/

      I also see a confluence of resistance on the SPY:

      http://www.freestockcharts.com?emailChartID=2880c2ce-3885-441b-97ed-4309717be871/

      The markets are definitely due for some gyrations heading into FED/ECB meetings, which could in fact lead to a blow-off top and a much better shorting opportunity. On the flipside, they could disappoint and we will definitely see some downward pressure.

      If you notice, I definitely add in small increments. (2/10) is enough for me to not care whether it goes up or down, but I would prefer lower prices so I can average in at a better price.

      Keep it small, and add slowly.

      -Bicky

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  49. SC, what are your thoughts on todays action, do you think we're missing the boat on UVXY? Thanks

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    1. this could still be a bullish backtest before we move higher into August 6-9...the drop is weak feels like...like really slow...waiting for some form of noise from the FOMC meeting...

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    2. Slow market. The VIX has crept up, but not urgency at this point.

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    3. This comment has been removed by the author.

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  50. SC, what does your cycle analysis predict for next week, positive or negative? thanks

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    1. I'm reviewing that now. Will do an update soon. Thanks.

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    2. SC..thanks for your input, much appreciated

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  51. SC, with the markets on a cliff's edge, you're suspiciously silent.

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  52. when ur huntin and a nice buck is standin behind a tree, r u gonna holler "MOVE SO"S I CAN SHOOT U??" or u gonna wait qiuetly to see which side he comes out on and then bag him and tag him???

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    1. Ah, stockman, so weez gotz us an elusive buck at 12, and the lead gunman screams, shoot..shoot; keep shooting cause weez bound to hit if weez shoots enuf. Damn, just a decoy. Weez gotz the real buck in our sights now, and lead gunman whispers; holdz yo fire! Lol

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  53. UNKNOWN...

    MY GOD>>>>>>>>>>>GIVE SC A BREAK..............YOUR ON MULTIPLE SITES ASKING OTHERS THE SAME THING! DO YOUR OWN WORK!

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    1. Lol, in case you haven't notice, there are many an unknown on this and other sites. Cracks me up, because I'm an unknown you're previously been in agreement with, and complimentary of...c'mon, get you unknowns correct for gawk sake, Lol.

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    2. IN CASE YOU HAVEN'T NOTICED! RIGHT! LOL............all anyone has to do is look at your profile! You are one in the same on the other sites.........like I said give SC a break!

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    3. Please name those *other sites*...me thinks yuz nuts.

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    4. Your constant stalking of SC for every 60 min move show your nuts .................just keep it up until he gets sick of your behavior and drops the site! I have nothing more to say to you..read your own relentless posts!

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