It is still possible to see a little upside, and test the yellow mid-fork line. I am suspecting that the early part of the week might be relatively quiet and choppy as a top is carved out.
All of my chart and cycle work is clearly pointing to the end of the week between Thursday, October 13th and Monday the 17th as the most important timing.
A severe decline into that time frame is anticipated.
60min Chart
Some may be thinking what fundamental reason is there for the mkt to see a severe decline over the next week.
ReplyDeleteFundamentally, the timing is interesting because of European meetings at that time. It appears to be the European climax I have been talking about.....
"EU leaders will meet in Brussels on October 17-18 to discuss revising a July 21 deal to provide Greece with a second rescue package. They may ask investors to accept losses on their holdings of Greek debt even larger than the 21 percent write-down set out in the July deal."
Quoted from:
http://www.cnbc.com/id/44827913
Found some old posts from Gabe that he had made on other blogs; according to some comments from the past few years, he's apparently one of the greatest trading minds out there; not surprised if he's decided to withdraw from blogs - trading is a life's worth of work and I totally respect his decision. Just sad to see him go.
ReplyDeletehi pablobob,
ReplyDeleteread your comments, although i dont comment on this blog as i wont provide any useful info, i am a regular reader. could u be kind enough to tell which blogs does gabe write on or he wrote on.
gabe , if you are reading this, thanks for your earlier posts and may god bless you
sc, thanks for your posts and your blog site
Hi Phantom:
ReplyDeleteI also don't comment on this blog as I am a novice and have nothing remotely interesting to contribute but I do read SC's blog everyday to learn as much as I can. Thanks tons to SC for this effort.
As far I could tell, Gabe used to run a blog at traderjoed.blogspot.com. I did some Google searches; I think he used to post on a couple of market cycles blogs and was extremely highly regarded. The best I could find as far as his profile was this: http://www.blogger.com/profile/11431570805275310899. Not sure if this is Gabe; I know Gabe used to sign his posts as "joed" on this blog.
Hi SC thanks for the updates, I agree with your bearish view, it looks like we may backtest the yellow line in the cash session as futures are up strongly in ES. What is your limit on SPX before you would change your bearish view.
ReplyDeleteYes in regards to Gabe it would be good to have him back as his posts were very interesting and informative.
As mentioned on Friday, Monday's open looked bullish. I think we'll spend some time up here with chop and carve out the top.
ReplyDeleteMy limit would be the yellow mid-fork line which is slightly sloping up, but within the 1180's all week. Late in the week is where all the action is going to be.
Yes SC that looks like it could be the scenario. Thanks
ReplyDeletepablobob,
ReplyDeletethanks a lot
Hit the yellow fork line 1181. Likely to slump from here imo.
ReplyDeleteSC,
ReplyDeleteAt what level is your analysis wrong
Must say we were spoiled when Gabe was posting here. He was the most accurate by far. His posts were extremely useful to myself. Just want to say thanks for all your useful insight Gabe. Hope to see you post here again, if not, I appreciate all your previous posts.
ReplyDeleteNo one came/comes close to Gabe
ReplyDeleteGreat trader and super nice guy as well!
ReplyDeleteFor limits SPX should not go significantly above the yellow midfork line which is in the 1180's all week. As well the Sept 27 high at 1195 is important.
It certainly doesn't appear like it wants to sell off
ReplyDeleteI suspect it might hover up here for a while today, but a test of 1150 of a little lower might occur next few days.
ReplyDeleteLate in the week is the interesting part.
Keep in mind much of today's gain is an optical illusion because of Friday's slump into the close. It is weaker than it looks on the surface.
SC,
ReplyDeleteDo you do any work on the FTSE? I ask because i have the late August highs of 5449.67 as being extremely important for the global bull market argument. The FTSE is a great index to look at for divergences and bullish divergences are extremely rare.
Yes, I follow the FTSE. The FTSE took out the Sept 28th high, and so is relatively stronger than SPX. Remember, I am just bearish for another week. After that I am bullish.
ReplyDeleteThe FTSE is already reflecting an improving situation in Europe.
Fundamentally, the timing around Oct 17th is interesting because of European meetings at that time. This is when all my cycles point to a European climax.
ReplyDelete"EU leaders will meet in Brussels on October 17-18 to discuss revising a July 21 deal to provide Greece with a second rescue package. They may ask investors to accept losses on their holdings of Greek debt even larger than the 21 percent write-down set out in the July deal."
Quoted from:
http://www.cnbc.com/id/44827913
Sc, when you say cycles, can you elaborate is it astrological cycles or is it just some other cycles that you are using? What is the cycle that is exerting the bearishness for this week? Do you see a new high at year end or into 2012 1st half ?
ReplyDeleteI'll show some of the timing cycles. In this case there are multiple cycles (both timing and others) lining up into the Oct 13th to 17th timeframe therefore I consider this to be very strong signal. It should be very powerful.
ReplyDeleteIt looks like the cycle may be lining up as a high ............
ReplyDeleteDon't be skeptical, there must/will be a drop and it must be this week. Everyone is getting too enthusiastic, I am surprised for example how far AUD/USD went, but I hope that there will be a severe decline and am waiting for it. They will announce the bad news soon... Some people were saying that even Gabe was predicting some low number of less than 1000, so if you don't trust SC then may be you trust Gabe.
ReplyDeleteAll I can say is that I'm using the same methods this time as I used to identify the selloff into the Aug 9th low. That time I should have been more patient shorting into the time cycle date. This time I will be doing just that...
ReplyDeleteI see this being a similar severe bearish setup.
I just saw in the news that the EU meeting is postponed for the Oct. 23 if that makes any difference. So we could bottom on other kind of news and then the rise may be based on news from the EU. Just speculating, of course.
ReplyDeleteBBL,
ReplyDeleteMy comments (I cannot speak for everyone else) regarding Gabe were not meant to be negative towards SC. I for one is thankful to SC for not only providing this forum but also for his excellent analysis and opinions. Just because one may be critical from time to time or in disagreement does not imply a lack of respect or trust.
Oh PK I know we all respect SC and appreciate what he is doing I didn't mean that you or anyone else is negative towards him. I agree that his numbers were a little off but can't blame him for that. At this point I won't even be surprised if spx reaches 1200 or higher, but I am a newbie and prefer to listen to someone's predictions and at least stay vigilant. However, we are on our own on the market and one should look at how it is moving, check how the currencies or other indicators behave, read what other people think.
ReplyDeleteSo no offense to anyone here. Let's hope that the market turns negative soon.
Thanks BBL. Just an idea regarding the meeting.
ReplyDeleteSC
ReplyDeleteKeep up the good work !
Your call on 1180's - right on target, so far.
Overall, very appreciative of your hard work, and to the point Analysis.
Both small caps RUT and Financials Rifin have barely tested above Friday's high today. Much weaker than SPX.
ReplyDeleteSigns of weakness coming imo.
SC,
ReplyDeletethis one is really great from a risk/reward basis. If you're right, the reward is huge and if you're wrong, the stop levels are really close by.
Exactly.
ReplyDeleteAs well, I think the key here is patience. First, the mkt holds up relatively well with sideways chop. Then all of a sudden it can drop further and faster than seems possible.
I took a nibble of TZA here in the low 42's here. Glad I stuck to my guns and sold my TZA at the close on Friday. I hate holding anything over weekends. I could be a little early, but it is $5 less than what I sold it for on Friday. Looking to add the next couple of days.
ReplyDeleteOne can assume if this is the last drop for the markets for some time, this will also be the last time to use the VIX for a while.
SC I added some shorts at 1183 and I also feel this market is way overdone on the upside at this point. I also favor a big move on the down side. If it did come to it what would be your absolute limit on the upside to change your thinking on SPX. I would not like to see anything above 1195, what are your thoughts?
ReplyDeleteway too strong if you ask me
ReplyDeleteYes I agree Muzz right around 1195 is important. We're there now, that may be the top right there.
ReplyDeleteBefore any big drop the mkt always does it's best to squeeze out the shorts.
SPX came down hit the midfork 30 min ago, and bounced into the close. I like that because the mkt is "feeling" that level.
ReplyDeleteToday's close at high of day almost 1195. The last 15 minutes have been algo driven or more short covering at the end. It has benn like that for quite a few days already. It is certainly very hard to be patient shorts. Sometime i feel like i am sitting on a mat filled with pins. Will there be further upside tomorrow and yet still keep the severe deline scenarion intact?
ReplyDeleteany further upside here and the yellow fork line will be the bear's, you know what!
ReplyDeletesorry. meant to say "up the bear's, you know what"
ReplyDelete