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Monday, August 8, 2011

SPY - Support Lines

The following chart indicates some lines to watch closely over the next few days.  For SPX they rest in the 1,040 to 1,065 range.

2day Chart

125 comments:

  1. Hi SC

    current future price is at 1083.2001. not much further from your range 1040 to 1065. Would you consider any bounce from those range or further decline?


    Thanks!

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  2. sc,
    do u think s/p could go to to <1000. if that be the case, do u think it is armageddon!!. or perhaps smart money may let it run a few points <1000 for some time and then scoop up big time. we all know that 1000 would be huge psychological barrier.your targets are very close to 1000. the way markets are acting in the last week or so 10 points of s/p are trading like 1 point on "normal " days. thanks

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  3. Is the top Aug 9/10 SPY bottom also the GLD/SLV top? Gold is looking scary stretched above its 200 DMA as it continues tp climbs to 1800 tonight.

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  4. Lol! Now you're too bearish.

    I think we make a bottom on tuesday in the 1080-1105 range then have a rally.

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  5. Still in shorts TZA from 37.5 since early August.

    I have a fib target date bottom late this week for a major bottom- but I will probably cover shorts tdoay and start to go long

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  6. SC was right - this is a massive bear trap! Time to go long now for a monster rally of epic proportions.

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  7. bear trap ?! have you looked at Europe ? !

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  8. http://chartramblings.blogspot.com/2011/08/dax_09.html

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  9. Sure we are going to rally but the bear trap talk is hilarious.

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  10. We may not make it down to the supports shown on the chart above. I am simply showing that the support is there. It may just be the case that we overshot the blue fib fan.

    It does seem that we bounce strongly today, but as I have been saying the biggest concentration of selling comes late today, most likely tonight or tomorrow.

    The rally coming is going to be insane. I would expect almost no one to believe me.

    Watch and see.

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  11. SC, any thought on silver, if the market bounce, will silver drop? When do you see silver top? Thanks

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  12. Silver could make one final surge up then collapse. Gold crash coming soon also.

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  13. And how high do you expect this insane rally to go up on the S&P ? 1250 ? 1300 ? Higher ? - And roughly by when ?

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  14. The point is this talk started at 1260 or so

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  15. Over 1575, and soon. I'll have more to say on the timing. The largest short squeeze in history is coming. Most traders are waiting to short the bounce for P3. Do what everyone else does, and the mkt will take everything.

    People will laugh. Fine by me. I know what I see in the cycles.

    How many foresaw the 2008 crash, the unbelievable rally that came after it, the May 2010 flash crash, or this most recent decline?

    Respect this unprecedented bubble, and the dynamics that go along with it. Even the best traders have made this mistake. Soros tried to short the internet bubble, and was caught badly.

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  16. 1575 ? I ain't laughing,but I don't see that happening this year anymore. If they can get the S&P back to 1200 and turn that into a strong base..I "might" buy into us getting back to 1350. Anyway...we shall see. The market just gave back all it's gains already this morning.

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  17. SC,as you said the market will have bottom around 10th then will raise very hard, so around 10th will be last surge for silver?

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  18. Hook - you gave 2 examples of extreme nymo readings yesterday, and both led to new highs. Now you are saying that the bear trap is hilarious.

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  19. You need to step up SC and say you missed the crash over the last week. Then you will be fine. Thanks

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  20. Hi SC

    wondering your target for the rise of SPX today? before the fall into aug 10?


    Thanks!

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  21. I have to agree with SC on this one. According to my work, yesterday's close corresponded with an identical price structure with the following dates: May 25, 1970; Sep 13, 1974; Oct 19, 1987; Sep 20, 2001; Jul 23, 2002; and NOV 20, 2008;

    Lows were seen the very next day (today) in all cases but that of 1974 where the low was made a couple of weeks later.

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  22. I bought the morning decline FWIW. Should get a bounce and then a retest and then a massive rally.


    The bounces from similar oversolds in early Oct 08 and after the flash crash were 8 to 10%.

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  23. XLF hit SPX 880 levels yesterday as well. With all the bullish talk about financials that needs to be addressed.

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  24. In 1974 markets bounced 15% then made new lows in December.

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  25. Interesting PK, thanks.

    Of course I missed it. I have said many times already that I underestimated the strength of the selling even though my timing of selling into Aug 10th was correct.

    As far as how far it bounces today, this bounce could be powerful. Near 1200 would be my estimate. Let's see how it goes.

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  26. Hi SC

    right after 1200 you think it will bounce back down to earth like worst than yesterday for the rest of today and tomorrow?


    Thanks!

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  27. SC, silver thrives on liquidity. In such, pretty much inflationary environment, with S&P shooting to 1500, shouldnt it race to old high of 50 and possibly above that?

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  28. Hook,

    The December lows of 1974 were basically a re-test of the low made around Oct 1st. In the above cited instances, the ones that produced a re-test within a month or two were laying the groundwork for a major cyclical advance. Only 2001 did not produce a re-test and that led to the collapse of 2002. The 2008 example did produce new lows in early 2009 but in hindsight that was basically a re-test of the Oct/Nov 2008 lows (yet at the time it did not feel like it).

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  29. I think we bounce hard for now, and it comes down again either late today or tomorrow. Not sure which.

    I think Silver and Gold have been treated as safe havens therefore both collapse with the mkt rallying huge.

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  30. Comment stands, new lows were made.

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  31. There is no example of a bull market continuing after two 10% corrections, the call for 1575 is simply without precedent. The first was April 2010, the second one now. Good luck with your white swan prediction.

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  32. Looks like the market just simmers here in the up 150/200 points range until Bernanke speaks. Got no idea how that will play out. I really don't think he can deliver on some promise of a QE3 plan on steroids to kick the U.S. market in high gear again here. That might even get him into trouble.We shall see.

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  33. Hook - you don't seem to acknowledge that this bubble is without precedent.

    I don't need luck as I have done the analysis a long time ago. Feel free to disagree, and prepare to be surprised.

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  34. I hope you are right and so does everyone else in the world.

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  35. Well actually I have not said what happens after that yet.... Wish it wasn't true.

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  36. SC - What's your time line for this surge? Days, weeks, ???

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  37. SC,

    Well ok then! This selling that happens today or tomorrow............do we make new lows or double bottom?

    Thanks

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  38. After the 10th the cycles are wildly bullish from my point of view. I want to do some more work on the timing - just have been busy.

    I wonder the same ckorey. Partly it may depend on how far up we rally today. I am expecting powerful selling, so it may be best to consider a low lower in the worst case.

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  39. Sorry, meant to say, how long to do you think it lasts to reach your target? As fast up as it's come down?

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  40. hi SC

    curious to know what is driving this powerful selling you indicated on the 9 and 10? news? fed annoucement? sentiment?


    Thanks!

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  41. I actually think it could go up just as fast initially, but the eventual top would be months away, and things would likely slow down/stabilize.

    The date comes from the cycles which ultimately reflect sentiments. For example, several weeks ago sentiments were focused on positive earnings. No one cared about debt.

    Going forward a rising short squeeze mkt would be taken as a sign of economic recovery regardless of the data. People may say that low oil prices have created an environment for recovery. I think soon the talk will be that this was all just a misunderstanding with the government confusion and downgrade.

    All of this is irrational, but that is why bubbles form.

    Many are saying who would buy this mkt now going forward to push it up? Answer: the same people who bought the mkt after the last 2 crashes since 2008. 3 crashes in 3 years. Buyers each time.

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  42. SC, what happens after 1500 or whatever? Huge HnS pattern completed and down we roll for a last time? They close the markets? Ban trading?

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  43. SC.. whats your downside target for today tommorow?
    being its the 9th and 10th ...

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  44. After that we live a simpler life, and hope that people can accept that.

    Not sure Sami. I'll have to watch as it progresses.

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  45. Whats the time frame for that 1 year? 2 years?

    I agree, west seems to have had its peak in the late 90s, now it seems to be shrinking, not sure about asia. Although its probably global this time since everybody is trying to live by western example, making the same mistakes.

    Are you buying any physical metal on this correction, when it comes?

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  46. Also, doesn't time for a silver move up expire tomorrow, the 10th?

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  47. The whole process will take time. Plenty of time for metals imo.

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  48. Man, that went down fast. Rouge bots.

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  49. SC was that the sell of you were looking for?

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  50. Yes, think so. Now let's see the bottom is.

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  51. SC,

    Think that it's 60/40 that we just saw a bottom. If we can close up here or a bit higher I would say yes. Still a chance of a lower move tomorrow 1080ish that ends strong by days end but this looks good so far.

    If we saw the bottom today then look for a rally into thursday a weak friday and then another rally into next wed.

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  52. Hi SC are you still looking for more downside today or tomorrow before starting this rally to 1350+ or have we seen the bottom. Have gone long today?

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  53. For some reason just not convinced yet. One of my indications calls for the peak negative tonight. I really can't say if this is going to be an issue for tonight or not.

    Realistically it is difficult to be exact.

    I like how the mkt is bouncing around though. Good sign.

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  54. SC, so silver and gold will drop from here?

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  55. Bought some leap calls when it crashed down to 110. I was waiting for that. Now, just going to sit back and see what happens. Have a lot of time to sit lol.

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  56. Let's see what happens with the metals tomorrow.

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  57. SC, Gold silver ratio is going up, past recent highs, could be targeting ~57-60.

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  58. I like deep correction in metals here because everybody and their mother are bullish on gold (and silver) now. GS/JPM and others come out with revised 1860-2000 targets in the near future. Unfortunately, i think they are right, un-backed paper currencies and unpaid debts are not going to go away, i only hope their timing is wrong...

    We need a good shake out in gold! Scare everyone $ht..less then reverse and shoot north again. Silver had one, gold did not so far.

    Sorry, just out loud thinking here.

    Also, back in april - silver went parabolic, but gold did not! im thinking gold is now doing just that, silver is waiting for it to come back down and then both lower. I hope that i'm right.

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  59. SC still not shorting gold or silver?

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  60. SC,

    Is your cycle still the same as your last chart (previous post)? If Aug 9/10 is the low, either today is the low (which mean the one bounce then drop to new low in the cycle won't materialize), or we dive hard tomorrow (without going to test 1250 first).

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  61. Hi SC are we still looking at a drop in the next session or two before we head up to the 1300+ area. I would like to take more of a long position but not sure if this rally is the start of it or we move down first before heading up.

    Thanks

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  62. Hey SC

    Able to post from my tab, at last

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  63. SC,

    If the market bottomed today/tomorrow, it will be an amazing call you made of downward pressure into August 10 - a call you made over a month ago!

    At the same time in July, you made a call that August 10 would also be a major turning point for silver and that silver would plummet after. You said, "if Silver is going to make a last push the window is open until the 10th" and after the 10th, "Once Silver has topped, I see it declining rapidly to $15-18."

    Now that we've reached that point, you say there is still time and maybe one more push up. Are you seeing something different in your cycles? Seems like your work from weeks ago is playing out, and that silver is ripe to follow your original roadmap - down hard right here. It would certainly fit in with an S&P rally scenario. Any thoughts? Thanks!

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  64. I wasn't all that satisfied with the bottom today. That is because I preferred to see a larger bounce before the bottom than what we saw.

    Normally I use the cash figures, but if one uses the futures from last night then the bounce was better.

    The other point is that my timing cycles can come in late. A day or two is acceptable.

    I see some indications of weak to mixed action the rest of this week. Next week looks very bullish to me.

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  65. Similar with the metals, it just doesn't seem quite mature to me yet.

    How are you Stockboom? Hope you are doing well in this mkt mayhem...

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  66. Rally into tomorrow's close then weak into Friday close.

    Rally again into next Wed. It will just be a large ABC type move and I say it tops somewhere in the 1225-1250 range.

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  67. Hi SC

    Has this rally to 1300+ target of your begin yet? Or is the current market a small drop or a bigger drop before this rally?


    Thanks!

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  68. Most likely this is just back and fill with a bounce pushing higher than yesterday.

    However, I am expecting a retest of the lows later this week, maybe even much lower.

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  69. Hi SC, meant to say thanks last week, your conviction of Silver dropping kept me in my shorts and managed to get out with some profit.

    Do you think your predicted SP rally take the dow with it?

    I hope it bounces as high as yesterday, I'm long! Leaving silver alone for now..

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  70. SC,
    I am a little confused. The words "much lower" are not compatible with earlier statements about after Aug 10th, cycles are super bullish.

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  71. Starting somewhat on Monday and particularly Tuesday looks super bullish. The rest of this week is mixed.

    We can bounce more, but I do favor a retest of the lows, and worst case much lower is still possible. I'm not saying it is going to happen, but it can't be ruled out yet either.

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  72. SC,

    Agree, think we rally back here by end of day maybe into tomorrow morning. Friday will be weak. Monday and Tuesday we rally.

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  73. 1020 - 1050 boys! thats where this baby is headed to

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  74. Gold almost at $1800; any comments SC? It certainly has gone far beyond the call for a summer collapse in metals.

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  75. Gold went parabolic with all of the current hysteria. I am waiting for it to finish up. The miners tell the story.

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  76. 1020 YES, but i believe 1300 comes first.

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  77. Today has been a back and fill day. Tomorrow may be a better upday. I am seeing some indications if the close is weak today, then may consider some longs there for tomorrow.

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  78. This comment has been removed by the author.

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  79. I suspect a weak close, but am seeing good signs of an upmove coming next. 1197-1216 may be next.

    So if I like what I see late today, may hold overnight.

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  80. Inverse H&S possibly forming. If so, may get some upside.

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  81. Hi SC

    Do you suspect silver will continue to rise for the rest of this week to catch to the gold's rise this week?


    Thanks!

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  82. France maybe downgraded....beware....We might drop hard just like the US downgrade.

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  83. not happening just yet:::
    Speculation that France's triple-A rating may be at risk rattled markets, though the three major agencies reaffirmed the top-tier rating.

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  84. SC...no offense, but so far this week your day to day forecast has beeen completely the opposite to what the market did. I am glad I did my own DD.

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  85. We may close red but up into tomorrow I think 1192ish.

    Sell off into friday and up Mon-Tues. 1225-1250 should stop it.

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  86. "France maybe downgraded....beware....We might drop hard just like the US downgrade."

    What are you talking about? You just said this an hour ago...

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  87. This comment has been removed by the author.

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  88. Looking at the crappy market, I think 1010 for S&P may happen. what you think SC? in the next few days. before your bounce that jump like crazy. Then the fall of men kind.

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  89. how about we investigate and downgrade rating agencies?

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  90. there should be a rating for the rating agencies LOL

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  91. InvestBB,

    I'm going to look at it closer today, with some chart updates.

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  92. lol SC....Don't get me started. You said couple days ago we are going up 100 points on MONDAY and 100 points on TUESDAY...lol...whe should be around 1375 accourding to your calculations for S&P....LOL...I subscribe to EWI. We will never see 1375 again. We are lucky if S&P touchs 1250 before a crash like 2008 if not worst.

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  93. SC...according to your calculations Silver should be plumetting right now....LOL...its rising. its passed your Aug 9th date you kept preching for the last 2 weeks. Now you don't even commet on Silver cause your completely wrong.

    SC...What are you talking about?

    You call yourself a market specialist. I would guess the market without doing any kind of research and be more successful then reading your research...lol

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  94. Good grief. EWI timing has been terrible. They have called P3 for 20 years... Not saying they are wrong, but from a trading point of view - not useful.

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  95. SC, your original view that Aug 10 should be a turning point in the markets and PMs may be the right one, best not to over analyze

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  96. EWI is the biggest brainwashing vehicle out there that has fantastic marketing; that garbage has no idea how to make money. It;s not just the market, how about gold? they have been fighting the uptrend since inception.

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  97. Hi SC

    would you go long today overnight according to the current price? or would you sell it all and wait till tomorrow?

    Thanks!

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  98. I'm going wait until nearer to the close and see. So far as expected weakness into the close.

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  99. Looks like a very weak weak close. holding overnight, SC? Do you expect a jump tomorrow or continue dropping?


    Thanks!

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  100. I probably will go long before the close as I think the indications are positive for tomorrow.

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  101. went long 50%. see how it goes tomorrow. thanks SC

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  102. SC, you said that you went long last week and earlier this week. Now you said you might go long before the close. When did you sell your previous longs? You never mentioned that at all.

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  103. SC I think the SPX may drop down to test 1010 low from July 2010 or maybe only down to 1040 - 1080 area. Before a more substantial bounce does occur but there has been huge technical damage done in the markets and this may change this a little in terms of how far the rally can take us. How do you see this playing out, would you look at adding to long positions here or wait to see more action over the next few days? Look forward to your new charts & analysis

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  104. wow tumble to -50points. dang.

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  105. For the most part I only mention my major trades. I believe my most recent statement was that I was long with cash to add.

    We did see a ton of weakness into the close as mentioned earlier in the day. Feeling good about how things went today, and looking forward to tomorrow.

    Of course it boils down to probabilities, and I'm no magician.

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  106. It's possible any weakness is limited to the overnight market and gap higher in the AM

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  107. That is my opinion as well PK.

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  108. The Dow made a new closing low; not confirmed by the S&P, Russell or any of the other broad market indices, many times this happens at inflection points.

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  109. new for all:

    http://data.cnbc.com/quotes/AA,AXP,BA,BAC,CAT,CSCO,CVX,DD,DIS,GE,HD,HPQ,IBM,INTC,JNJ,JPM,KO,KFT,MCD,MMM,MRK,MSFT,PFE,PG,T,TRV,UTX,VZ,WMT,XOM


    interesting extended hour trading on the DOW from link above, almost all of the freaking equity is positive. interesting...

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  110. 18$ silver? 1300$ gold?

    we are screwed. lol.

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  111. Bear trap? Rally? Pictures speak louder than words.

    http://www.screencast.com/users/katzo7/folders/Jing/media/92358901-6901-4266-923b-8e0c8a32cd72

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  112. SC, wipe off your Cristal ball! Are you sure you holding it right? We are getting nervous here ..

    In april gold silver ratio reached 1:30, historical low ratio is ~1:17. With gold at 1800+$, 60$ silver is just a matter of time, if it goes for 1:17 - thats 100$+/oz silver. Everybody should pick up some calls on SLV as an insurance in case silver decides to repeat its april's parabolic performance act and blow the roof off. seriously.

    If confidence in fiat and market tanks futher gold could be trading at 2500 and silver at 100. very soon. I do not see Washington or any other government fixing things any time soon.

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  113. Hi Katzo7, can you please explain a bit on that picture? what it all means to us newbie.

    Thanks!

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  114. BB, I think it says what used to be support is resistance and markets are about to tank further down.

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  115. BB & Bluemoon, I read it differently - he is saying that wave 3 terminated at the recent lows and we are in a wave 4 up. Usually wave 4 retraces 38-62% of wave 3, so that implies 1190-1250 or so as a target. It is possible, but it would be unusual, for wave 4 to have terminated already at the most recent 1170s high in ES. On the other hand, his chart also implies there is more downside to come after 4 completes.

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  116. First InvestBB I do not follow anyone, EWI, or any other EW analyst, I do my own EW analysis. I am a day trader and post real time ES levels, direction, and calls on http://chatroll.com/es-trading. As for my chart, I was watching this EW5 develop, the EW5 top being put in with divergence and the subsequent double ABCs. Single ABCs are continuation; doubles are reversal of direction. Many were calling for 1430 to 50 at this time. Some called for 1600.
    One cannot deny the steepness of this fall, this should mean something to analysts. IMO this is nothing to fool around with on the bullish side, today's action spotlighted this thought. Fed. intervention is starting to unravel. And on the purely TA side, take a look at the 20/50 MAs on the DAY & WEEK. And compare the length of the MONTHLY impulsive candle --it is a big one -- with what happened in 2008 and look at what happened after that 2008 candle. I think someone said on this site that down moves do not end with this type of massive candle. I think the selling is is far from over. Based on the MONTH, tgt 943 by April 2012. Also there is a two up day and short rule in bear markets, this up lasted a sole one day. That is notable. And bear market short covering rallies are vicious, as shown yesterday. But it all evaporated today. More down to come.

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  117. Hi SC, Your August 9-10 cycle date is what I have been seeing too. http://tinyurl.com/3rt3qf6

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  118. Hi SC I went a small long position on the close as well as I feel that 3rd wave maybe complete or close to it. With this next bounce up do you see the target around 1200 to 1250 before the next wave 5 down to new lows say 1040 to 1080 range to complete this correction. Then the start of the next rally to new highs. Is this how you see it or have you a different take on it? Look forward to your next charts and analysis.
    Thanks SC

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  119. Thank you ZigZag, excellent chart!

    We should bounce big right here Muzz.

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  120. Doesn't look like SP is bouncing to me....

    What do you think of this mornings action SC?

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