Monday, June 29, 2015

SPX, INDU, NYA: Market Slips on Greece

Long-time readers know that I believe news is noise -- but I just couldn't resist the "grease" pun in the title.

Amazingly, since last update, the market has moved only 4 points on a closing basis.  Before going further, I would like to preface this update with the note that my personal life has not quite returned to "normal" (whatever that is) yet, so I'm going to let the charts do most of the talking.  I would also like to most sincerely thank those of you who have sent support and well-wishes, it's all very much appreciated!

We'll start by taking a look at INDU, which seems to have the clearest chart.  Sustained trade north of the B/2 high would, of course, call the preferred count into question:

Next is SPX:

And finally, NYA hints that a sustained breakdown would ultimately have a decent shot at testing the 2015 lows:

In conclusion, the pattern in INDU appears to suggest further downside over the near-term, but the bigger picture pattern on SPX may be hinting that any downside follow-through from here may ultimately prove to simply be a correction (though it could well be a scary one) with new all-time highs to follow after it completes.  I'll track this as it unfolds, to try and identify the next pivot point.  Trade safe.

Tuesday, June 23, 2015

Update Schedule

Updates should return to normal on or about June 29.  In the meantime, I hope everyone is well.

Thursday, June 11, 2015

SPX and INDU: C'mon, Feel the Noise

Last update expected that 2099 would prove to be only a short-term low, and would be revisited and broken.  That happened soon thereafter, and the pattern is now back in flux inside the seemingly-endless Noise Zone.

(By the way, today's update will be short and sweet, since I still have numerous personal issues demanding my time, energy, and attention.)

The first thing that jumps out on the charts was something I originally discussed more than a month ago, shown below via INDU:

SPX may be in a slightly different position, but if it has a complete ABC decline, the outcome will be the same as the blue count shown on the INDU chart above:

In conclusion, this isn't a pattern I would trade with anything but the tightest stops and nimblest approach, since we're back into a noise zone that has encompassed literally the entire year.  As they say:  There are old traders and there are bold traders, but there are no old, bold traders.  Although, there are old, bald traders.  Whichever is greater.

Or maybe they don't say that.  But they should, given all the other nonsensical stuff the ubiquitous "they" have been known to blather on about. 

Anyway, this is a good place to keep both sides of the trade in consideration.  Bears need to break the 2072 low for things to have a shot at getting ugly, but as of right now, there's nothing in the pattern that screams that they will do so in the immediate future.  Trade safe.

Wednesday, June 3, 2015

SPX Update: The Best Intermediate Trade

Since last update, SPX has continued grinding sideways within the zone represented by the red circle, as originally discussed on May 19.  The near-term pattern has the appearance of an expanded flat, and hints that the current consolidation/rally might end up being sold to new lows below 2099 -- we'll take a closer look at that on the near-term chart.

First, the daily chart:

The near-term chart shows the potential expanded flat.  This is, of course, not the only potential, it's simply the one that jumps out as a slight odds-on favorite:

Finally, the diagonal we've been discussing remains on the table for now.  Note that the expanded flat shown above could form the ABC to complete wave (iv), but because the the pattern of the past few months (actually, virtually the entire year so far) is a bit unclear, we can't bank on much of anything right now, and things could be more bullish or more bearish than shown.

In conclusion, the near-term pattern hints that 2099 is only a short-term low.  The intermediate pattern still hints at a terminal phase, but is so incredibly noisy that claiming high-confidence about having it "all figured out" would run a bit too arrogant for my tastes.  All we can do for now is try to position for the near-term and adjust on the fly as needed -- and that's pretty much the only approach that's worked all throughout 2015 anyway; every other approach has been whipsawed to death multiple times.  So for the moment, I think the best intermediate trade continues to be:  Long humility, short arrogance.  Trade safe.

Wednesday, May 27, 2015

SPX Update: "Momma Always said: 'Resistance is as Resistance Does...'"

Before I get into the charts, I want to apologize for the sporadic updates of late, and alert readers that my energy and time are going to remain tied up in a significant personal issue for roughly another month.  I'm going to try my best to publish at least two updates each week throughout this time, but I do want to warn everyone in advance that those updates may not fall on the usual days, since they will be done on a "time-and-energy-allowing" basis throughout this period.

With that announcement out of the way, let's get right to the charts.  For the past couple weeks, I've been mentioning that SPX 2136-40 appeared to be the next key resistance level.  Last week, SPX stalled at resistance about a point shy of that zone, which ultimately lead to yesterday's steep drop.  Presently, there are still a ton of options on the table.  The diagonal shown in last Thursday's update (and in the update of May 8 before that) remains credible:

The chart below contains some additional details in the annotations: 

Finally, the SPX daily chart:

In conclusion, the market has not tipped its hand in a meaningful way for a long time, which suggests it's gearing up for a sustained move in the reasonably near future.  Because of the nature of the price action for the past few months, I'm still slightly more inclined to think we're in the final stages of a terminal pattern, but, technically, we can't yet eliminate the possibility that this is a bullish coiling pattern, so we should continue to remain alert to both sides of the trade until the market gives us something a bit more conclusive.  Trade safe.

Thursday, May 21, 2015

SPX Update: The Matrix Has You

I am sincerely hoping this is the last super-short update for a while, and that we can return to our regularly-scheduled programming next week.

Since last update, the market has continued to stall at resistance, but there's (still!) been little in the way of definitive pattern clarification yet.  Below, I've noted the obvious potentials.  Frankly, the massive bull nest looks a bit far-fetched, so I'm more inclined to think this is a terminal pattern.

Even viewed from a simple classic TA perspective, things are still pretty gray ("grey" if you're British):

In conclusion, this is still the most inconclusive pattern I can recall seeing in years, and I'm seriously considering taking the red pill.  This still has the feel of a terminal pattern, but it's one that could certainly continue to grind sideways for a while.  As noted previously:  If bulls can sustain a breakout, then bears might consider taking a "watch and wait" approach for a time.  Trade safe.

Tuesday, May 19, 2015

SPX and INDU: Short and Sweet Update

I've had some very exhausting personal issues to contend with lately, so I apologize in advance for the brevity of this update.

Bulls are now testing the first upside resistance levels on SPX and INDU.  Basically, bears will want to maintain a cautious stance if there's a sustained upside breakout, particularly if price momentum begins increasing.  If there are back-tests of the breakout zones, pay close attention to whether those succeed or fail:  If there are lots of anxious buyers waiting on the back-tests, then that will be a positive sign for bulls, but if the market starts dropping through the zones that should be providing near-term support, then that may be a warning of greater pending weakness.

Trying to keep it simple again today, so just two charts.  INDU first:

SPX is in the process of testing upside resistance:

In conclusion, the next few sessions may hold the key to the market's intermediate-term future, so bulls and bears will likely be watching closely to see how price reacts to nearby levels.  For the next update, life permitting, I'll attempt to present some of the options for wave counts.  Trade safe.