Friday, November 27, 2020

SPX Update: Short Session

Today is an abbreviated session that is, historically, "usually a bullish day" -- the reason for this is because it's typically a light volume session, and big players avoid selling heavily into light volume sessions because their own selling can move the market too much against them.  That said, I've seen plenty of sessions that perform counter to their historic tendencies, so I never automatically assume the market will perform as it "usually" does on a given day.

Chart-wise, not much happened on Wednesday, with SPX holding below the 3646 zone, then falling back toward the pink breakout line, but not quite tagging that line before staging a small bounce.

In conclusion, both intermediate options remain on the table, with nothing having happened in the past few weeks (it's still inside the trading range that began on November 9) to rule either option out.  Trade safe.

Wednesday, November 25, 2020

SPX Update: ..........

Still in the trading range, so still no real change.  SPX bulls have thus far continued holding the support areas they needed to hold and have now rallied up to the next noted resistance zone.  Bears may try to push back at resistance here.


In conclusion, it's still a range-bound market, so no change from the past few updates.  But I can now add:  Happy Thanksgiving to everyone!  Trade safe.

Monday, November 23, 2020

SPX Update: Rinse, Repeat

What do you say about this market right now?

Maybe:  "How 'bout them Steelers?"

Besides that, we can pretty much just refer back to the last update verbatim, because nothing has changed.

So I guess on the bright side, that makes my work here a little easier than normal.  Trade safe.

Friday, November 20, 2020

SPX Update: Rangebound

Really glad I came back in time for a trading range!  Nothing has changed since the update of 11/16.  Worth a mention that it appears to be three down from 3628 (though it could actually support one more low to be a complete three down).

In conclusion, I've noted the next apparently-meaningful levels on the chart above.  Beyond that, we've been in a trading range since the Coronavirus vaccine was announced, so there's nothing much to add until that trading range breaks definitively one way or the other.  Trade safe.

p.s.-- On a completely different note, I spotted this sign at our local Safeway last night, and thought it interesting, given the double entendre it might have these days:

Wednesday, November 18, 2020

SPX Update: No Change

Pretty much nothing has happened since last update, so no change to the market's position:

Longer term, worth noting the recent tag of the old black trend line, which again proved to offer resistance:

In conclusion, the market has remained range-bound the past few sessions, so no change since last update.  Trade safe.

Monday, November 16, 2020

SPX Update: Two Intermediate Options and a Glance at the Long-term

Last update, I noted the option of a triangle (largely because I wouldn't be around in real-time to point it out if it came to pass), and the market elected to ignore that option and run to a new all-time-high.  This does finally confirm the read that the last two declines counted as complete ABCs, at least -- and it opens up two fairly defined options from here.

If the market wants to go the straightforward route, it could keep running higher in an apparent third wave.  If it wants to complicate things, then it could instead turn the current high into a b-wave.  I've outlined both options below:

On another note, INDU has finally made a new all-time high, thereby officially confirming the count that everyone thought was crazy just a few short months ago:

(Below is how that prediction looked when it was first published in February):

Now, this brings up an interesting point:  By all appearances, the market seems to currently be within a fifth wave at multiple degrees.  Given the size of the preceding waves, it could certainly run higher for a while before topping (potentially much higher if we get a fifth wave extension) -- and referring back to the first chart, it appears it does indeed still need to run higher, so the anticipation of a fifth wave is not in itself a reason to start shorting.


But it is something to be aware of.  The end of America's long run of prosperity may finally be peering back at us from the edge of the horizon.  Still off in the distance, but finally visible.  And I think, unfortunately, that many of us can see exactly what will get us there.  But that's further discussion for another time, perhaps.

In the meantime, the party is still going -- even if we can see that its time is gradually drawing to a close.  Trade safe.

Wednesday, November 4, 2020

SPX Update: No Change, But One Additional Option to Consider

For the last few updates, I've suggested we would likely have a close and contested election, and that's exactly what we got.  That, of course, despite multiple polls having Biden up by double-digits (will anyone alive today ever fully trust political polls again?). 

I had hoped the market (at least) might resolve one way or the other, but it now appears the market is not surprised by this (the market is a better predictor than the polls; shocking!).  Since there's been no market resolution, there's likewise no change from last update, but I do have an additional option (which I've been considering for a few days, but which now seems possible enough to at least mention) to share.

First, the unchanged chart:

Below is an option I've been watching but waiting on... tonight's "non-reaction" makes it worth publishing now.

I'm not at all certain of the above, but we did appear to have three waves down from 3588 to 3209, then (potentially?) three up from 3209 to 3549, then a fairly clear three back down from 3549 to 3233 -- which is the correct structure for a larger triangle (each triangle wave breaks down into a corrective wave).

And with that, I'm going to take a week and a day off, and will return on November 16.  Unless I just can't stay away, which is entirely possible... but that's my plan at the moment.  If this ends up being the triangle, then it might work out well enough for all of us, we shall see.  Trade safe.

Monday, November 2, 2020

SPX Update: Nothing to See Here, Just a Sea Change...

So... one day left until the (probably contested) Election begins.

Here's something big and Federal Reserve-related to be aware of if Biden wins:

"the elimination of disparities of...employment, income, wealth..."

For anyone who hasn't done the math here, this is what has come to be termed "equity" -- which is political-speak not for equality of opportunity (which everyone should favor) but for equality of outcome.  That same anti-liberal concept is discussed in more detail in today's piece On the Eve of Election, Liberals and Conservatives Must Unite, as America's Supercycle Peak Approaches.  Also quoted in the above linked piece, here's F.A. Hayek (again) to explain why equality of outcome can only lead to massive inequality:

It always sounds so... GOOD and well-meaning, doesn't it?  Yet we know how that story ends because we already ran that experiment in the 20th Century in the old Soviet Union.  Equality of outcome is an idea that's so far left it isn't even a slight exaggeration to call it full-blown Marxist.

As with many things:  It starts as something that sounds good, but ends in destruction.

Anyway, that was brought to my attention last night, and given that it would institutionalize a Marxist ideal in the most powerful institution in the world (the Federal Reserve) and the Federal Reserve likewise has a great deal of sway on the markets, it seemed rather important to be aware of.

Moving on to the count, there's no change from last update.  Bulls held the previously-discussed price point and inflection zone, and futures are indicating a gap up open:

In conclusion, there's no change at all since last update, except to note that the market is now set up for a potential big move (shocking).  Keep in mind that if the bear count comes to pass, the conservative target is 3180-3200, then ~3150ish... but the most aggressive potential targets stretch as low as ~3000ish (and potentially beyond if we then form a still-larger impulse wave).  So, not surprisingly, we may see some fireworks in the wake of the election.  I'm just barely leaning toward it being in the downward direction, but it really could go either way still, so please take that with a grain of salt.  Trade safe.