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Saturday, September 12, 2015

$SPX - Comparison with 1987 Crash - Levels to Watch

The current price action of SPX is remarkably similar to the 1987 crash (on a smaller scale).  Price action has settled down in September.  SPX is currently near resistance though.

Most likely there will be another scare with China.  The Shanghai probably will have some wobbles as it completes a bottoming process, and there is some correlation.   

Around the end of September looks positive.  The first half of October may see some weakness.  However, later in October may see surprising strength.

30min Chart
















1987 Crash:



















XIV is forming a base, and likely to continue trading mostly in the lower half of the fork.  Levels to watch:

30min Chart

28 comments:

  1. Hmm.. I can understand the comparison with 87, but still... the bigger picture is increasingly bearish with each month... having been stuck since February.

    Q. Do you see the Fed raising rates next week?
    --
    ps. much better page/colours layout.

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    Replies
    1. Yes, and I also agree the big picture is bearish, but I see the market recovering into 2016. My VIX Cycle does show VIX retesting 50 eventually, that's a few years away though.

      Yes, in my view rates will rise next week. Because the maket has already dropped, and it has been widely telegraphed, I doubt it will result in more than whipsaws.

      Thank you!

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    2. I suspect we will get a surprise move down Monday tuesday. Every one is waiting for the Feds to act on the 17th. Huge whips saws coming this week. Sp 1880 min.

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  2. XIV has reached the green oval.

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  3. Shanghai dipped a little last night, but seems that it may pop to 3,400.

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  4. Just waiting, SPX has reached the green oval, but has not quite reached the white trendline.

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  5. SC- that means spx 1980 area, Thank You. Good trading.

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  6. Thats close enough. I am out. Thank You

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  7. SPX reached the white line today in the cash market. However, the futures need another 10 points to hit the line.

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  8. I will be taking profit and entering short soon!

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  9. XIV melted up through the midfork and reaching near the upper fork.

    SCSeptember 9, 2015 at 12:08 PM

    "XIV has formed a trading range $21 to $26. Next week we should see a pop above that $28 to $29."

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    Replies
    1. Because it melted up through the midfork, the next green oval needs to rise to $24.

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    2. SC, did you sell or waiting for a better price. Not sure if we will see XIV back to $24 range next week.

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  10. Shanghai spiked as expected. A little more to go towards 3400.

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  11. UVXY looks good around $38. Should see $80 but that's a month or more away.

    $60 later this month.

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    Replies
    1. That's a big drop from 46, are you looking at a higher target now on SPX, not 2000 on the chart?

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    2. Still around 2,000 SPX. I'm getting very bearish short term.

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  12. SC, just to understand are these your next approx targets:
    This week: UXVY: around $38 and XIV: around $31?
    Next week: UXVY: around $60 and XIV: around $24

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    Replies
    1. Yes, UVXY could be even higher within a week than $60. As much as $75.

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  13. SC are u looking to get out of XIV around $29 or wait for UVXY to $38 and then get out.

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  14. I thought today's price action was quite bearish short term. I'm in XIV but getting out tomorrow and probably going short. XIV $22 to $24 coming within a week...

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  15. Fear just evaporated today and that is extremely bearish short term. Plunge coming to the market within days. 1900 SPX within a few days.

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  16. SC. you are really looking for Spx 1900 sometime next week?????

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