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Thursday, April 28, 2011

SPY - Equal Time Cycle

There may be an equal time cycle currently in play.  Watch May 3-4 for a major change in trend. 

I think we should see some weakness and consolidation prior to May 3rd.  However, the equal time cycle suggests this is a candidate for a topping date, and subsequent downturn.      

Daily Chart
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26 comments:

  1. BlakeApril 29, 2011 at 5:04 AM

    We are due for some type of pullback. I don't know how deep to expect, but likely to 1330 or so at least. Otherwise it will have to trade sideways for a while to work off the overbought conditions. Perhaps the jobs number this morning wil create a large spike up that will fail.

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  2. BlakeApril 29, 2011 at 5:59 AM

    Apparently I was confused about the jobs number coming out today

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  3. SqwiiApril 29, 2011 at 7:19 AM

    I think we will see a pullback from this level 1360-1370 range or very soon.....

    Objective targeti is 1325-1330 SPX before going higher to 1380 or 1420

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  4. SCApril 29, 2011 at 7:34 AM

    Financials weak this morning. That was the missing ingredient for a selloff yesterday.

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  5. BlakeApril 29, 2011 at 8:02 AM

    quite unlikely to get a correction on a Friday. Over the last 2 years, you can probably count the negative Friday's on 1 hand

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  6. BlakeApril 29, 2011 at 8:39 AM

    looks like we are about to break higher again

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  7. SCApril 29, 2011 at 10:30 AM

    Slow grind today. We do still have the weaker financials. They haven't tested yesterdays highs.

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  8. SqwiiApril 29, 2011 at 12:33 PM

    SPX in a bearish rising wedge same with dow jones - about to breakdown.

    IMO marked topped today at $SPX 1365 - my objective target is now 1325-1330 next before another rally.

    Good luck to ya all

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  9. SCApril 29, 2011 at 12:50 PM

    Thanks Sqwii, have yourself a great weekend!

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  10. SqwiiApril 29, 2011 at 1:10 PM

    AAPL not a great close - big volume decline into close - I think we might begin the pullback I am looking for to 1325-1330 sometimes next week or late next week

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  11. SamiApril 30, 2011 at 5:33 PM

    wow look at the money flow on appl on friday.

    2.4 billion pulled.

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  12. EllipseTradingMay 1, 2011 at 11:25 AM

    SC,

    although I find fascinating your tecnique of "rewinding" cycles to read them, I do not undestand the principle.
    What I mean is that as we know uptrends and downtrends have different psycological approaches, because greedy act different from fear. That's why flash crash are so commons while we do not have so much of flash-ups. Upgaps tends to be filled a lot more often than downgaps.
    If one expects a top, would'nt be wiser to search for past drop, and try to whatch how they acted in the original time direction?

    Thank you in advance for the answer,

    G.

    http://www.ellipsetrading.com

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  13. SCMay 1, 2011 at 8:55 PM

    Good question G.

    I have a post coming that should clarify this with further explanation of the theory.

    If we search for a similar drop in the past, and that can be useful, then that is a different approach. That would be a similar fractal pattern.

    I like to find the actual cycle that the mkt is trading back through. The reason is that the movements share much in common as the mkt is tracing back through the original cycle itself. Particularly this is true of shape rather than time, and importantly we can be confident that it will continue.

    There is contant analysis required, but it is essentially a map of how the mkt should trade going forward. We can prepare and identify what the best trading strategy will be to use in that part of the cycle.

    Often the declines are steeper than advances, but the shape is the same (yes, it goes back to survival instincts and it seems that fear is stronger than greed).

    A fractal can work for a while, but at some point it just dissolves, and we never really know when this could occur, or if it is just a rough spot.

    Ideally it is best to have cycles in different time frames all showing the same result going forward. In that case, we can be very sure and confident in our strategies.

    One other point, I have found that mirror images are often more problematic than not. Obvious looking patterns are best approached cautiously. If it looks too good to be true it probably is.

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  14. SCMay 2, 2011 at 7:58 AM

    AAPL still struggling despite the mkt rally today.

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  15. SCMay 2, 2011 at 8:02 AM

    The equal timing cycle comes up tomorrow May 3.

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  16. SqwiiMay 2, 2011 at 12:06 PM

    Shorts working out well so far from Fridays buy -

    What is your target on SPX ?

    I have a target of 1330 area

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  17. SCMay 2, 2011 at 12:55 PM

    Yes interesting reversal today.

    My target is way down. I want to do some more checking on that as the date and downside target in mind is almost unbelievable.

    Then again had I said 10 days ago that SPX would be 75 points higher that would have been unbelievable too.

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  18. SqwiiMay 2, 2011 at 2:25 PM

    Well please make an update as soon as you can.

    But my analysis my objective target is 1325-1330 area which we could see by mid May....

    So lets see - May 16th again debt ceiling I guess

    Best

    Chris

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  19. SpudthorpeMay 2, 2011 at 6:47 PM

    Here's some technical support for your view. The red line overhead which has thus far stopped the advance is the trendline connecting the April 2010 and Feb 2011 highs. If we dip to retest the support trendline (red arrow) that would be in the range of a 50-62% retrace of the recent rally leg. http://screencast.com/t/RXSokV9Uih

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  20. SqwiiMay 3, 2011 at 8:10 AM

    SC what was your downside target and date ?

    Russels down big today AGAIN ... looks great , shorts working nice via TZA now

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  21. SCMay 3, 2011 at 8:44 AM

    I'd like to show that target along with some charts and the reasoning. Completing that analysis currently.

    Today seems like a sideways shuffle. Some of the bigger names are holding a little better today. AAPL and GS for example. GS sticking out like a sore thumb though. GS had a terrible April, and barely rallied off the April lows.

    GS has been declining since fall 2009!

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  22. SCMay 3, 2011 at 8:51 AM

    The time cycle as shown in the chart above is today/tomorrow. Some mkts likely topped yesterday, but some may be yet to top. So I suspect we may be waiting for some to finish, and then we can see a larger selloff.

    Financials are holding in there today. I agree with you that RUT looks like it has topped already and heading down.

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  23. SqwiiMay 3, 2011 at 9:34 AM

    The differnce between us is that we both agree a down more is comming and already begun imo - but you think we head a lot lower where I think this is just a minor pullback - but time will tell imo , if I see a heavy and strong sell off with big volume you may be right , but if slowly down I think a big rally is to come after pullback

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  24. john smithMay 4, 2011 at 6:15 AM

    I'm curious why you guys dont wait for CONFIRMATION before calling a top?? TY

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  25. AnonymousMay 4, 2011 at 6:52 PM

    such a crazy day and its so quiet here!
    SC what's on your schedule after all this free falling and ramp ups this week

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  26. SCMay 4, 2011 at 9:17 PM

    I was quite pleased with the way this timing cycle worked out. There is another timing cycle coming with an important date.

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