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Saturday, June 22, 2013

$SPX - July Plan - Large Moves Ahead!

The Cycle decline for SPX has only just begun.  It has been a relatively choppy decline to start.  The Cycle predicts choppy spots, and also during some time periods, rapid declines on the way down to Point P.

SPX is approaching near the red horizontal, and there is a decent bounce shown in the Cycle from that level. 

According to the Cycle, expect the market to move much more aggressively going forward.   

60min Chart
















According to the large Cycle, SPX is in the process of dropping to test the white trendline from the March 2009 SPX low.

3day Chart
















The Deja Vu Cycle expanding formation is shown with the red lines. Notice that there is an overshoot of the upper red line at point A.  Then the Cycle declines to test near the red horizontal with a bounce from the horizontal level.



 

98 comments:

  1. Excellent work
    Should be an interesting summer!
    Thanks

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    1. Thank you. According to the Cycle, it does suggest a fast paced market ahead.

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  4. SC,
    If I read your chart correctly, S&P is expected to touch 1560 first, and then shoots up by 100 points to 1660 by the middle of July, and then moves all the way down to Point P 1380 by early August. UVXY could sink to 50's again and then go up to 20's, just within about one month's time!

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  5. Sorry, it should be from "50's to 200's".

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    1. I'm still getting used to the new numbers!

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  6. We'll take it one step at a time. The Cycle projects an aggressively moving market ahead with relatively larger and violent moveements.

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  7. The key to this Cycle right now is the red horizontal for SPX. We've come down a little closer to it today as per the plan.

    I'm confident that the market forms a low, and bounces. That line is the key to the Cycle here, and the only event that would have me shorting is a break below it.

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    1. Red line is horizontal and around 1540 area?

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    2. Yes, that is right. I don't expect that to be quite reached here. I'm just saying when that line breaks later in the Cycle, I would be short.

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  8. Thanks SC. Looks like gold/silver are getting close to your projected targets, are you still looking to take positions? How big of a bounce do you think it's coming?

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  9. Yes, I plan to take positions in Gold and Silver soon. My Silver Cycle shows a large bounce. $8 or more for Silver. Gold may be even more attractive!

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    1. SC, do you anticipate a strong rebound for precious metals going into 17 July and then sell off with general market going into August? And new lows for Gold and Silver in that case? Or a strong rebound from now that would be continuing until September or so? Thanks!

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    2. According to my Silver Cycle, Metals can rise for a few months strongly. As well, near the current levels should be the lows for the year for both metals.

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    3. Thanks so much and your response is greatly appreciated. Keep up the good work, and good luck in your trading!

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  10. SC, when do you see we will test the white trendline target, end of July?

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  11. Yes, on pace for end of July/early Aug.

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  12. SC do u think low is in this morning. We did touch 1560

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    1. Yes, I think so. Strong reaction there.

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  13. The VIX (Volatility Index) is starting to show panic levels ...

    Take a look at the VIX chart posted today. From its October 2011 peak, we drew fan resistance lines.

    We just recently broke another fan resistance line to the upside, so fear levels are increasing and a little bit of panic is setting in.

    At what point would panic levels accelerate?

    If you see the VIX close above 23.23, then fear levels will start to get emotionally high.

    And ... increasing fear is not good for the market, so keep an eye on the 23.23 level.

    Please click on the link below for today's complete commentary and chart:

    http://www.stocktiming.com/Tuesday-DailyMarketUpdate.htm

    Marty Chenard

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  14. Thank you.

    VIX hit the white line yesterday on my VIX chart from prior analysis. That white trendline goes right back to the VIX 2008 high of 89.

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    1. SC, on my chart it shows that VIX high in 2008 was 96.40 (10/23/08)

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    2. Checked a few places and just see 89.

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    3. OK, I think you are right!

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  15. SPX should bounce for 2 weeks or so here. Quite likely we saw the low yesterday.

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    1. still see bounce back to 1650?

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    2. 1660 or so, and there should be two dips along the way.

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    3. great call, you said last week that we should see a low Fri or Monday

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    4. Thank you, it worked out nicely.

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  16. So basically I want to see 2 dips before I go short. Will plan to short on the third drive to the peak. A couple weeks to go - first half July.

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  17. SC, silver spot price hit 19.49 low today, do you think we still have more downsides to go?

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    1. Silver looking good. Gold might get a little closer to 1250 ideally, but getting close.

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    2. Good value for the metals down here.

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  18. Should see VIX cool off to around 14 just before the July crash.

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    1. For UVXY could see an entry $60 or under, and then a triple over the next month.

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  19. Hi SC

    You plan to enter XIV for a trade then?


    Thanks!

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  20. It can work, but I probably won't post any bullish trades here since July looks so bearish. Mainly better to focus on UVXY entry. Silver/Gold look worthwhile too.

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  21. Don't get me wrong. I think the market will bounce well for a few weeks next, but the bulls need to use precautions. Stop under 1540.

    XIV is the widowmaker.

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    1. XIV is a short term trader only, and according to my large Cycle the longer term target (1 or 2 year period) for XIV is near zero.

      If a person were to get caught holding XIV at the wrong time there is simply no way to recover the investment. VIX can easily go over 100 during that time frame.

      So it's strictly a short term trader only.

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    2. XIV would never hit zero. Even when VIX was over 45 for 3 months in 2011 the lowest XIV got was $4.85...so VIX would have to go over 80 for any XIV plunge to 0. Even then it would just undergo some nice reverse splits like UVXY...speaking of which...in this scenario UVXY would be multiples where it is now... Like over $1000 at least...so it would be really funny if they had to do a forward split on this one for a change..

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    3. When SPX reaches Cycle Point P, XIV will have lost most of it's value.

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  22. Hi SC

    Isnt UVXY a widowmaker too? looking at the past and current UVXY price. :)


    Thanks!

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    1. Yes definitely, UVXY in the past was the widowmaker. Looking to the future, XIV is the about the worst etf I can think of. Sure, there will be a few short term spots it can work though!

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  23. I mentioned earlier that there may be 2 dips during this rally.

    Roughly 1620 dip to 1590, then 1645 to 1605, then final pop to 1660. All approximate of course. I want to short and will load up on UVXY on that last pop.

    The whole process should take 2 weeks or so.

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    1. Hi SC

      Guessing you seeing us going to 1620 now then?

      Thanks!

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  24. Most likely 1560 was the low.

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    1. Loaded up XIV at 18.20, 18.45, 18.60.... Good for move to $21-22

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  25. SC ... I must say your call here looks prescient - I think at these levels we could easily fall 20%-30%, maybe more (much more?)

    I've been generally bearish for most of this year now but only started putting on some positions starting around 2 months ago. So far I've got a 2/3 position on UVXY at an average price of $64 and a 2/3 position on both TZA and FAZ at an average of $31-$33. Finally I have a sizeable position that is short the AUD put in place when the AUD was a bit over parity to the USD.

    If we get the pop you're expecting I'll be focusing all additional capital on UVXY to get additional exposure to Vol which is primed to go parabolic given the general state of leverage in the markets at the moment. Like you, I'm definitely looking for $200+ on UVXY... I think its more than possible assuming VIX approaches anything like the level in 2008 (~89) or in 2011 (~47).

    PayDay - I like your prediction for UVXY at over $1,000... that would definitely make my day!!

    RT

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  26. RT, just basing my prediction on former tvix action in 2011 which move from $15 to $110 in 2011 with Vix move from 17 to 45

    Now SC thinks vix will move even higher , therefore uvxy will move multiples higher thru the miracle of backwardation...not there yet mind you!

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  27. Theoretically, VIX would have hit around 150 in the 1987 stock market collapse, so one could imagine an immense move in UVXY in that scenario... but as you say, no counting our chickens before they hatch!

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  28. Volatility etfs did not exist the last time there was a bear market. So people do not realize how high they can go during a bear. Yes, in 1987, VXO reached 170.

    Based on my large Cycle work, UVXY can approximately triple over the next 6 weeks with VIX reaching 30's easily maybe 40's.

    This first drop shown on the SPX July plan is only the first Cycle decline down to Point P.

    There is a much larger Cycle decline down to Point Z later in the Cycle. During that move to Z, based on the Cycle, the UVXY measured target is $1,450. This is a long time away of course!

    It is best to take these Cycle moves one phase at a time.

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  29. Took positions in Gold at $1,240, and bought Silver at $18.80.

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    1. I'm buying them to hold during the crash next month for S&P. The metals should act as a safe haven for a month or two.

      Maybe I would look to sell them in late July or Aug.

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  30. Very confident this is a Cycle low for Gold and Silver. This low may hold for the rest of the year!

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  31. My targets are about 50% higher for both metals!

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    2. I do not have a hard stop, but I believe there is good support around $1,225 Gold, and I think it should hold above $1200. So I'm confident that these levels hold, and form a low.

      I really like the metals at these levels for the next month or two.

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    4. Miners will do well. I think this is an especially good setup for Gold. Silver typically sees a larger % rise but this time I expect Gold to do very well.

      Similiar to July/Aug of 2011. Gold can really rocket off this low.

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    7. It can take the metals a little time to form a low here, and they may just trade flat here for days forming a low. However, I don't see them sitting down here for a long time either.

      There probably is not urgency for today, but the price is right. I think there is great value at this level for the metals and according to my Silver Cycle they turn up very sharply and abruptly.

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    8. According to the Silver Cycle a very strong bounce for a month or two, and that is all. Long term still bearish as I've been saying since 2011.

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    11. The Cycle is based on Silver. Silver minimum target around $27. Compared to Silver the Gold bounce could be unusually strong this time.

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    13. Well the targets are derived from the Cycle. I've been waiting patiently for these entries. I don't expect much during the next week, but expect a lot for the metals a month from now.

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  32. NUGT looking good too. Summer target around $14 to $15. Triple.

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  33. Wont NUGT have another reverse split first?

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  34. So actually UVXY and NUGT upside looks about equal over the summer months. The difference is in the longer term picture. UVXY looks fantastic longer term wheras NUGT looks terrible again after the summer months.

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  35. If NUGT looks terrible, how i will DUST go? Already made spectacular move from $22 to $160....

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  36. The Silver Cycle has been excellent. The Cycle called the 2011 Silver crash and bear market to begin for Silver in 2011. I'm using the same Cycle today.

    I warned the Silver bulls in 2011 with $6.50 target. Still on pace for that. Of course I received a lot of hate mail for that call, but the Silver bulls should have thanked me for the warning!

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    1. Gold bugs are the most stubborn of all investors! They are right in the very long term, of course.

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    2. How long term? I wanted to retire by 2020. - lol!

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    3. SC, if Gold goes to 1530 by mid September or so, could GDX reach to 40? Would you please make a comparable for the two with your methods and post here? Thanks!

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    4. We're only a little past halfway in the Gold bear Cycle, and I expect Gold to trade flat after the bear end for years also. So it is going to be a longgg process...

      However, those who hold Gold 100 years from now would surely be thrilled.

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    5. GDX, I would think $35 minimum, maybe quite a bit more possible.

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    6. I was having 50% ret for Gold from late last year to this latest drop, with that comes 1530. Likewise for GDX, I am seeing 38.75. I don't know how to trade with NUGT after buying now. I know there wouldn't be a straight up to 38 for GDX and with moderate retracements along the way, NUGT could be lethargic. If you happen to have any ideas on that, please let me know. Thanks!

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    7. They might be flat here for a little while first as the low properly forms. Then, I think they will start slowly grinding up for weeks and finally rocket straight up. According to my Cycle it will surprise how fast they accelerate up.

      I'll have an update coming and can show how it looks.

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    8. Thanks SC, I appreciate your help. I will look forward what you got to show on that one. If larger gains are at the tail end, that's even better just like dust right now!

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  37. DUST is due for a setback with a drop over the summer months, but looks great longer term. Years of upside.

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  38. Great? Like how great? Are we talking DUST over $1000?

    Not sure which has more upside: UVXY or DUST? I would be inclined to say UVXY since DUST already made 700% move in 6 month!

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    1. I'd definitely go with UVXY. One reason is that the miners will probably bottom sooner than the metal.

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  39. Its worth pointing out in this discussion that yesterday the VIX 50 day SMA crossed the 200 day SMA for the first time since July 2011. At that time, VIX popped from ~18 to ~47 in very short order.

    Although I don't have the VIX index data at hand, I believe the majority of times the 50 has crossed above the 200 (and its only been a few - certainly less than 10 times) have resulted in large VIX spikes shortly afterward...

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    1. Yes, the golden cross. VIX entering bull market.

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  40. Hi SC,

    First, I would like to know what represents your position in gold and silver compared to your position in UVXY ?
    Second, I would like to know what instruments did you use to trade gold and silver ? Futures, Options, Etf ?

    Many thanks for sharing

    Boris

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    1. My position in UVXY is going to be much larger. I like Gold and Silver at this level but only for a 1 or 2 month pop.

      In this case I bought AGQ and UGL. I may buy some NUGT also.

      I have a Silver Cycle chart coming today.

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  41. SC, where do you see current support levels for $VIX?

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  42. Still about 2 weeks for VIX to fall and SPX to rise. SPX will run into some resistance soon, and VIX a little support in the 16's but VIX will see 14's easily, and probably lower.

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    1. Is that the 1st dip you mentioned, from 1620 to 1590?

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    2. Yes, that 1st SPX dip should occur soon.

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  43. New Silver chart has been posted!

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