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Thursday, February 16, 2012

SPX Update: Apple's Intraday Reversal May Be a Signal for the Broad Market

The charts are a mess tonight.  While the big picture view has shifted somewhat over the past month, my daily short-term preferred counts have been on an exceptional win streak since the end of January -- catching the lion's share of the rally since 1307, and a good number of the turns.  But tonight I've looked at the wave structures across markets, and really feel like the market's quite undecided, and could go either way right here.

I'm leaning toward the idea that there will be more downside in store for this market over the short term, but my confidence is only marginal.  However, I've found a pattern in the New York Composite Index (NYA) which has nice clearly-defined breakdown or breakout levels -- so we can simply wait for the market to tell us what it wants to do next.

The first chart I'm going to share is the bigger view of the NYA, annotated with the interpretation I'm leaning toward.  The second chart is short-term, and annotated with the clear breakout/breakdown levels.


This next chart shows the clear levels to watch.  But before the chart, this next little bit of discussion is geared toward novice traders: a breakout or breakdown through a key level by no means guarantees that the market will follow through.  The key levels do, however, generally give you better odds of follow-through in the direction of the break -- and, more importantly, they give you levels to work from to determine stops and entries. 

Usually when the market breaks a key level, it will return to that zone to back-test it.  That back-test is usually considered the "safer" entry point.  If the market is unable to penetrate back through the key level, the trade is usually good.  However, it's always important to be on guard for whipsaws; so if the market breaks-out/breaks-down but then returns to that point and penetrates significantly back through the break point, it's likely you're in the process of getting whipsawed -- and it's usually advisable to close out and wait for another trade, or stop and reverse to the opposite trade.  Otherwise you risk turning a minor loss into something more substantial, because whipsaws are often followed by strong moves in the new direction.

Anyway, the chart below isn't as detailed as the first chart, but indicates the levels to watch.  Aggressive traders could play off the trendlines, and then use the key levels noted as further confirmation of direction.

The next chart is the S&P 500.  The fifth wave up may have completed yesterday, though I'm not crazy about the structure.  Also, the labeling on this chart doesn't match the NYA preferred count.  After studying the NYA, I'm more inclined to think that no matter what happens today, there's still another leg up coming after any correction.  I will solidify, or adjust, this chart after the market gives a bit more info.  In a more normal market, I would be convinced a decline was due right now -- but this market has certainly fooled us all a number of times already.

If 1335 doesn't hold as support, there's a bit of an air pocket down to 1321.




Yesterday, Apple had its first bad day in a while.  It gapped up and then reversed strongly on heavy volume, thus at least temporarily thwarting investors' plans to drive Apple's valuation so high that it becomes worth more than everything else on the planet combined.

There've been 3 other times in the past 15 years that Apple has rallied at least 2% to a new 52-week high, then reversed intraday to close down at least 2%.  Each time, the SPX declined at least -6.8% at some point during the following month.  Two of the dates were 7/9/98 and 8/19/98 -- the third was 10/11/07, and is shown on the chart below.  (Statistical data courtesy of SentimenTrader.com)



So that's about all the news that's fit to print.  In conclusion, the short-term charts appear a bit hazy, so  it's best to let the market dictate what it wants to do next, by paying attention to the key levels outlined.  The uptrend is still technically intact, though the market is now showing some signs that it may be getting ready for a more significant correction, and the historical data shows that Apple's behavior yesterday is yet another warning sign that this rally may finally be getting tired.  Trade safe.

The original article, and many more, can be found at http://PretzelCharts.blogspot.com

344 comments:

  1. Ugh.  I have a splitting headache from staring at charts all night, and I'm reasonably certain I'm coming down with the flu, courtesy of one of the kids.  :(

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  2. Don't you just hate kids? Trouble, trouble, trouble. That's all they are!

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  3. My 7-year old is a walking petri dish.

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  4. GLD breakin' down this morning, tgt 164.33, below that breaks an important up pointed EW (240) and GLD will go lower.

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  5. Pretzel, I started using these Gunnar computer glasses and my eyes have felt better since. The black background and white text is harsh on the eyes.

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  6. I've heard good things about those -- but it wasn't that which caused my headache.  I haven't been staring at my site, I've been staring at charts in my Stochcharts book, etc. 

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  7.  So is SLV to 31.82 pre-market

    It is the B wave down and I expect it to bounce off its 50 DMA at 30.32 for the C wave up.

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  8. ES/3 min.

    http://www.screencast.com/users/katzo7/folders/Jing/media/b84033ed-19af-4fbb-806e-d82ea21de5de

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  9. ive got 1000shs ZSL at 10.17................hit its 20pd mov avg premkt at 10.82.......if gets above 20pd and holds im lookin at 50day mov avg at 12.00

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  10. ZSL
    T1 11
    T2 13.40
    T3 14.39
    I am better in gold than silver

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  11. AAPL turning higher IMO

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  12. Good morning, most people are saying that Friday is OpEx and should be positive for stocks. What do you think ? Do you see es touch and resetting at 1342 before the next downleg??

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  13. higher than 42 ES imo. we have to see what today will bring in order to better understand what OPEX will bring.

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  14.  Katzo,

    Just curious, how do you determine these levels? Do you use price volume as guide? TIA.

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  15. Pretz,
    Ask the pharm about eye drops that alleviate eye strain. My daughter gets them retail and they work for her.

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  16. No, EWs with GANN analysis to back check. Also TLs. And some MA levels thrown in too. I run them all on my charts, as said they look like a spaghetti dinner.This call is ONLY based on GLD breaking through that level I mentioned, no break and this call for ZSL gets dumped.

    http://www.screencast.com/users/katzo7/folders/Jing/media/08c59bf1-f93a-4a5d-8c03-1bb139925353

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  17. lower end of T2 hit (42 ES)

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  18. morning guys! what an opening..

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  19.  I read an article somewhere that yellow tinted shooting glasses (around 20 dollars) work as well as those gunnar computer glasses ( around 80 dollars)

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  20. TVIX lovers - I'd be buying the open here.  It's in an uptrend and VIX is about to crack upper BB and head to 30

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  21. Market is holding while AAPL drops.  Once it turns back up, we could have a fast rally.

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  22. AAPL faked me out a real dump (487 now)

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  23. That could be it for the AAPL down move, short term.

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  24. Since there was some discussion of this on the other thread, I just want to remind those who haven't already done so that if they feel they're not in a position to donate to help support my work, they can actually show support without taking any money out of their pockets, by signing up for accounts with TradeKing and Zecco, which is 100% FREE. 

    Accounts only need to be opened, they do *not* need to be funded.  It's quick and painless and *free*, and it's the equivalent of sending in a small donation. 

    Thanks again to those who have already shown their appreciation and continue to do so.  :)  

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  25. AAPL 50% retrace would be at 506.46 if the morning bottom holds.

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  26.  The AAPL loots .....

    Are now moving to the likes of MSFT, CSCO, HPQ, etc. That's why SPX is holding up by tech - without AAPL. :)

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  27.  My 4-year must have spoken with your 7-year old recently. :O%\%

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  28. This is the opening 30 minutes, guys. IMO, this is retail buying on dip versus pros exiting at gap resistance. The pros are holding the line. Once the retail is done, then a drop back to what would be the 5th test of support at 1335 ES.

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  29.  That sucks. I've been taking care of the little guy all week day and night.

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  30. SPX break down, mini flash crash??

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  31. Many thanks to SpikerJ for his 2nd donation!  Very much appreciated, thank you.  :)

    (Spiker, I'm having trouble w/ Paypal's tracking system, so I scanned through previous dontions by eye -- my apologies if it was your 3rd or anything.  I'll have to check again when their system's working.)

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  32. Speaking of TVIX, anyone have any ideas on a range for the next two days?

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  33. "...my daily short-term preferred counts have been on an exceptional win streak since the end of January...."   and what about your prediction that the market would top out at about 1333. I follow you and respect you as a good elliot wave technician, but your short term predictions, like most EWT short term predictions from everybody else, are no better than a coin flip.

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  34. another stop grabber to flush the weak longs? 

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  35. Philly Fed 10.2 better than expected.

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  36. Philly FED survey at 10.2 versus 9.5 expectations.

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  37. TVIX is very unpredictable, its intraday movement can be $2, but recently it is making higher lows and higher highs. look at today the market is up and it is up too. The volume on this thing has been incredible. If the market drops today or tomorrow, you shoul be looking at at least 24, the low will be around 18. Just my 2 cents, other fellow TVIX fans please chime in...

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  38. lol --

    MarketCrotch: Jobless claims give U.S. stocks opening lift, but fear over Greece remains counterweight

    Greece, is it?  What suddenly changed in Greece in, oh, say, the last two years?

    I love the news.  :D

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  39. Take care of yourself and get some sleep.  Katzo et al do a good job of holding down the fort.

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  40. 1344 hit. Going higher still? AAPL reversed and going back up after the initial drop...

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  41. If anyone is worried about time, it takes 20 minutes max to open both.  If your like me and have more time than money, 20 minutes is easy to help PL out.

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  42. Thanks to frannybrd for the *2nd* donation!  :)  Much appreciated!

    And thanks to Scott Z for his donation -- glad to hear you were able to dump a certain paid subscription service (who will go unnamed) as a result of my work.  :)

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  43. They have to have something to talk about between commercials :)  If they can just keep us occupied on Greece then we all feel good about ourselves. Kinda like a bunch of crack heads badmouthing the meth heads. :#

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  44. no, they are working on the weak shorts

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  45. It's quite liberating to finally be free from the Hoch!

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  46. Hi PL! Quick question: On your first chart of the NYA you drew a small line to the upside before the turning down for the next couple of days... I'm sure you didn't do that by chance. Since you already nailed it, since we do have an upside movement early today, do you have a reason to expect a turn in direction intraday and a lower EOD?

    Thanks a lot!

    PD

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  47. Agree 100%, and I think they will be working on them for most of the day.

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  48. guys & gals (where is Furrrr?),
    this is gonna take until abut 1 to 2 pm to sort itself out. there is nothing to be gained by trading today imo. the drops will suck in the bears, then it will turn around and sucker the bulls.

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  49. AAII sentiment is out - bulls 42.7% and bears 25.6%. Not really overly bullish anymore which I think is a prerequisite for the push toward the wave 5 target zone

     

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  50. I think it may be the opposite here.  Retail is selling while the pros are buying to bring the market back up by EOD.  Just my opinion.

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  51. I was wondering the same thing! Do you guys remember which day of February Furrrrr predicted a complete change in direction?? PL may remember...

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  52. Throwing a question out there. But if one were to not trade in their trading account for around 5 months, do you think TVIX is a safe bet to hit 30?

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  53. He was that bad? Never read him. I only read the guy upstairs, PL, not god. One can get info overload by reading too many position thoughts. Best to just look at the charts.

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  54. Since I'm assuming it's a triangle, it needed one more wave to the upside to be complete the EWT pattern, even if it' to head down later.  Of course, if it turns out it's the 4th wave triangle as discussed, it will hold the 7964 level and rally from here. 

    The b-wave triangle would reverse lower.  I'm simply unable to determine which it is at this point -- hence the key levels outlined.  :)

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  55. http://online.wsj.com/mdc/public/page/2_3022-mfsctrscan-moneyflow.html Money flow is a bit negative at the moment. While "pros are buying" works well with the idea of shaking weak short.

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  56. Chart not updated.

    http://www.screencast.com/users/katzo7/folders/Jing/media/b84033ed-19af-4fbb-806e-d82ea21de5de

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  57.  No problem.  2nd is correct.  Glad to help.

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  58. a gap open this morning on TVIX w a little head n shoulders today.  Little Inverse Head n shoulders on XIV , also w a gap open. i'm playing both today for something new. im waiting for 19.10 buy TVIX.  Anyone else play gaps?

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  59. hey PL - did you catch that typo on the first chart? "This gap makes is" should be "it" I think.

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  60. She had a number of dates, not just one. A few of them have passed already, with more to come. Sorta like PL's growing list of why top should be near. The "ultimate" date is 3/7 (?) but dunno.

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  61. Yes, i believe TVIX will hit 30 and beyond in your time frame.  The issue you will have for 5 months is you may have to update your sell orders after 30 days or 3 months or whatever your accounts allow to keep a standing sell order open.  This is not for the thin skinned as you can see the real drastic moves in both directions.  tight stop losses get taken out.

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  62. Do you have an upside target? What do you think of the fact that TVIX is still up 4% today?

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  63. Whoops, ty.  Too late to fix it now, the chart will have the day's price info on it now. 

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  64. I'm a buyer on dips at this point as its in a bull trend

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  65. T1 = 46-7 (are there now) is first tgt, prolly down to 42 from there, then one last move up just above TI.

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  66. lol-- Imma change my name to "the guy upstairs."  :D

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  67. hey pretz, with the next round of LTRO just around the corner, do you think it'll have the same effects it did on the market in december?

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  68. that makes sense. thanks for responding

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  69. If EWT works on TVIX (and I have my doubts, because it's a leveraged fund), a touch of at least 23 should be in the cards in the not-too-distant future.

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  70. i was thinking an email alert when it hits a certain price point

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  71. I don't think it will be as pronounced the second time, but it will not go unnoticed by the market, that much seems certain.  Barring some monster outside catastrophe, in which case it will go into bonds.

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  72. In December, it was a surprise.  The February 29th date is known by everyone.  I would expect a run up ahead of the announcement.  Once the announcement is made, we may get an additional pop up that last 0 to 3 days before the market heads down into a profit taking correction.  If the amount of the 2nd LTRO disappoints, it could be down into correction immediately.

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  73. Alright, I need to try and get some rest.  Everyone wish my luck on fighting off this flu.  :/

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  74. here are the levels, based off of the 120 ES chart. put a fib retrace on it and you will see how I got them.
    NEW ~ T ~ LEVELS
    T1 = 1345.75 fib 50% [HIT IT]
    down to T2 at ~ 42 [I will get out when I feel it is done and may not be available to blog it]
    up to 61.8% T3 at 1348.50 [thsi last one is to TBD relative to how the T2 is played out]

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  75. Good luck...rest, lots of fluids, ibuprofen

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  76. PL, I didnt open an account from below  but sent donation.  thanks for the time you spend on the charts

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  77. Today, MSFT is the new AAPL? :)

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  78. The market appears to have priced in the same amount for LTRO#2.  A smaller amount will most likely disappoint;  Too high an amount may signify something is wrong with the banking system.  So it needs to be just right to boost the market higher.

    But then, there is a Fed meeting on 3/13...

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  79.  What's 120 ES? Is that 120 min.?

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  80. RUT is strong today...

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  81.  Snuggle up with your 7 yr old :)

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  82. Thank you, Sandy. :)
    ________________________________

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  83. Yes, I believe so.  But it will whipsaw in between now and then.  If you don't trade frequently, the best time to buy TVIX is when PL calls the next market top (currenly estimated at SPX 1400+).

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  84. Say, did anyone else see that bit on The Slog today (http://hat4uk.wordpress.com/) that talks about the Greek default docs (courtesy of D.C. and Berlin) detailing the timeline for the Greek default, say on Mar. 23rd? And here we thought the Greek situation could go either way...

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  85. One the the market is going to struggle with is:   Is the improving economic data bullish or bearish for stocks.  It's Bearish.  Continued improvement will mean:  Anti-Business President stays in office, inflation will creep in and interest rates will start heading up sooner than Fedspeak, there will be no QE anything which kept the market afloat since 2009.  Despite these improvements, toss out Apple and earnings have been mediocre.  All of the above, along with spiking oil (gas) is going to mean the markets are going to have to get used to standing on their own two feet

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  86. Scary on so many levels if it's true.

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  87. Did all the VIX related stocks just flash crash ???  WTF

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  88. Good afternoon PL,
    looks like a 4th wave triangle in the INDU and a diagonal in SPX have got legs.
    Good calls.
    Again!
    Kind regards,
    UKDNY

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  89. oh, forgot, do get some quality rest to fight off the 'flu, can be very exhausting. :)

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  90. Quite a short squeeze there once Europe is closed. Weak shorts flushed out.

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  91. sold XIV 7.94 and bought TVIX 19.10...

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  92. What happened ??  Something triggered at 1350 and they all dropped like a stone UVXY from 7.50 - 7.30 in 1 second.  A flash crash

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  93. wild  action.. hang on folks

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  94. thats true. its so tricky though because isn't tvix dependent on the number of options (towards the downside) in the next 30 days? 

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  95. Big flush for shorts.....no stopping the market maker
    Katzo, upside target??

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  96.  The last paragraph is the most telling. My theory about the LTRO funds being deposited with the ECB as a ready-cash doomsday backstop may be supported by this...a pre-positioned bailout for the big European banks...only time will tell.

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  97. ECB Greek bond swap rumor causing fire works.

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  98. That's the difficulty with VIX and VIX related etfs.  If a key level on the S&P or DOW, etc... gets taken out in a bullish sign, then these instruments begin to crash with no warning.

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  99. It's huge institutional blocks its going from 7.05 and the next trade is 7.13 - crazy - stopped me out but I bought back in lower

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  100. Nice - XIV is a handy little stock

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  101. Here comes the bridge loan - Greece will not get all bailout funds prior to April elections:  In that scenario, the euro area would arrange a bridge loan to get Greece past the March payment, the official said.

    http://www.bloomberg.com/news/2012-02-15/europe-struggles-to-bridge-divide-in-forging-bailout-for-debt-laden-greece.html 

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  102. Good God - that was a 5% drop in 1 second - stunning and the size of trades are huge - it was 1350 that triggered that.  Yaooooozzzza

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  103. had fib level 52.50 and didnt short it.....should have been long all the way up!.....maybe this is high for day and we move lower for the rest of day......if we dont break yesterday high this would be a test of high and fail?

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  104. thanks for the tip.  ps. now you doubled my stress.. lol :)  i need 2 more screens and 4 more eye balls

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  105. "I need 2 more screens and 4 more eye balls..."  - So true!  I second that.  Very difficult to keep track of everything in real time.

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  106. Now AAPL is being used to pump up the market... or to hold it here.

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  107. Astro $.02 - since there was a question - we're in a reversal zone, at least ST (Venus sq Pluto yesterday) - however, that may only fit with the IV count illustrated by PL. From an astro perspective, it is completely feasible that we continue up into March due to all that  expansive Jupiter energy still to resolve. 

    What I'm watching is the Sun conj Neptune on 2/19 - which just happens to correspond to more supposed Greek deadlines, etc and the scheduled finance ministers meeting on 2/20.  By itself, this astro signature is not predictable of market direction - you will see it marked as a black line on both charts.

    That said, as far as financial astrology goes - Neptune represents the irrational, the rumor - the illusion.  In contact with certain other planets it is often around for the irrational "panic" buying or selling. 

    The first chart is a repeat from yesterday, the second illustrates some points from the market in 2000. The 2000 run-up prior to the top was a Jupiter (expansive) sq Neptune (irrational) push.

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  108. short 1 es at 1353

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  109. dollar dropped like a stone pulling fear vixes with it, ES above my 61.8% this will take some time. out of my short at 44. 

    next level is 1355 ES, that is a backtest of my bottom ED line.

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  110. dollar is the key today, it needs to turn to set up next down move

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  111. I've put in limit order to short at 54.50 and see what happens at that back-test...

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  112. If we can break out above 1358 and then reverse hard, a la aapl yesterday, that would make today outside reversal day in ES.

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  113. Not predicting that will happen, just hoping...

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  114. Could it be that this leveling off and slight pullback from the HOD a short while ago is drawing out the right shoulder of an H&S pattern on the SPX???

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  115. what will prolly happen is that it will hit that level, come down, and go up again. over that level is baddd thinking 2:30 ish

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  116.  As a Pisces, I must object.  I am only irrational when I feel like it, or.. when the invisible people start tickling.  :o

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  117. PL,

    Great site. This is my first post but been lurking for a while. Donation sent.

    I was looking at your SSI (super secret indicator) and noticed that it nailed the top in RUT in 2007. The Dow made a new high, but RUT did not. I wonder if we'll have the same situation here. Do you have the data to go back further with your indicator?

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  118. Astro question - "How many Pisces does it take to change a lightbulb?"
    Pisces answer - "What lightbulb?"

    :)

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  119. katzo7,

    Can you give any more insight on ghost spikes? When do they act as leading indicators and when should you ignore them?

    Thank you.

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  120. covered at 53.50  lost 1/2

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  121. New high, apparently not. 

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  122. Capricorn's answer : Never mind, I'll do it myself!

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  123. Capricorn's answer : Never mind, I'll do it myself!

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  124. pragmatic as usual   ;)

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  125.  Awe...We Pisces have our strengths too. Wifey calls me a SNAG (sensitive new age guy)....Did you say something about a lightbulb? :)

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  126. Not picking on you - Pisces are great concept people - ideas from nowhere - a unique ability to see linkages and big pictures - that's why they're not paying attention to the lightbulb, they don't need it to "see."

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  127. Wifey sounds glad she SNAGGED you.  :)

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  128.  I know you're just kidding :) We are indeed great concept people...but we always move on to the next great concept without finishing the prior one. I says to myself, "Self, I already know I could finish up this project, so why actually finish it...Neeeext."...ugh.

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  129. She's awesome, and totally puts up with me.

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  130. From an EW perspective - take a look that we may be coiling here for a iii type push up.

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  131. aaarrggghhh, can we please break out of this 1340-1355 range??? I don't care if it's up or down,  but this drives me  N U T S. I've been 100% cash since last wednesday when I closed my longs at 1350...  Lost count of if we just finished wave 4 or if this is iii of 5, iv of 5? PL, need your help. Can't trade 1-day up, next-day down like we've seen for a week. I guess that cash is thus the safest position for me for now.

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  132. Looks like SPX is on its way to 1365-1370, and VXX down to 26 or so.

    This market is crazy!!!

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  133. I'm guessing we just finished iii of v at 1358.25 SPX?

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  134. TVIX fans. Got in at 17.77. Hope this will be a good play

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  135. I think that today, the S&P will (or has already) put in the high for this rally from the December low. 

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  136.  Good stuff both of you, I totally relate.

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  137. When AAPL hits 506.46 (if it gets there), it will be very important for the overall market.

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  138. I was thinking it looks like there's a small gap to fill from the 14th. Might go down to around 16.20 but feel free to correct me if I'm wrong.

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  139. You are correct. That might have been the best entry point but with accumulated gaps on so many indicies who gets filled first. TVIX or you pick the index? I do think vol will pick up though imo. Just getting my feet wet on a small position. Thanks for the correct obsevation. I appreciate it.

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  140. good point. so far your entry has been about perfect.

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  141. It will be a cold day in Hawaii when I pick a perfect entry, lol. But thanks.

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  142. VIX Option trade update.. 

    http://www.youtube.com/watch?v=qDIX_WP32GY&feature=plcp&context=C381f038UDOEgsToPDskJ5N41U4D0i_zo85AWy0h1a

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  143. What is the significance of that price?  Do you mean 509.46 (2/14 EOD price)?  I'm not challenging what your seeing.  Just want to see what you are seeing.  Thanks in advance.

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  144. 506.46 is the 50% retrace of the down move from yesterday's high to this morning's low.  The 50% retrace is usually an important battle ground point for bulls and bears.  Above means up and failure means down.  Of course it could fail the first time (which it usually does), but then turn back up later or tomorrow and head back above the 50% level.

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  145. Excellent.  Thank you, sandyone44.

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  146.  Interesting find, glad you shared.  Have you followed this site enough to judge his work?

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  147. Wow. Somewhere between 18.90 and 35.xx?? That's mighty big spread, isn't it? What are they expecting on that upside - the demise of Greece?

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  148. Just closed out short at 1355.5, longer it stays up here, the more bullish it gets.

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  149. Hi Arnie, I recommend you take a longer time horizon and not worry too much about the intraday squiggle.

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  150. Not sure that it gets more bullish.  This is a test of the conviction of bears, and a bull trap.  Just my opinion.  Not trading advice.

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  151.  Katzo,

    What's the significance of 2:30 pm?

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  152.  This was his comment earlier today:

    "what will prolly happen is that it will hit that level, come down, and go up again. over that level is baddd thinking 2:30 ish"

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  153. dont know, that is what I predicted, we will see. have to go to a meeting so will not see conclusion

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  154. I agree it's overbought, but as it just stays here, it's working off overbought condition as a fct of time instead of price.  But I could definitely be wrong, often am.  But I don't want to stick around until last 1/2 hour and have to close out then if it's still sitting here.  Probably overly cautious on my part.

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  155. predict SPX HOD 1361; what do you guys think?

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  156.  Been reading some articles on the Slog, that was referenced earlier today.  Found bits of this article interesting:

    "But it’s the Chinese enigma that too many people are ignoring. Asian
    shipping shares aren’t doing well at the moment, and most of the indices
    measuring economic futures are at or near the red-flashing-light point.
    The equation here is remarkably simple: China exports to the West,
    West’s ability to consume spirals down the loo, China hits the ground
    hurting. China stops ordering raw materials, Australia goes into a rapid
    and deep recession, and the Sydney property bubble bursts. China cuts
    imports and tries to focus on the home market to take up the slack.
    Western exports fall further, and depression becomes slump"

    This line was pretty funny, in describing his home economy:

    "This is indeed what makes Britain a special case – as in a special
    Basket Case – among the EU’s larger players: the French have their
    farming to fall back on, and the Germans their engineering. We have a
    bunch of lunatics buying and selling worthless shreds of paper."

    http://hat4uk.wordpress.com/2012/02/14/crash-2-moodys-downgrades-chinas-lending-binge-herald-the-next-phase/

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  157. We also likely have different time frames in mind.  I was only looking out next hour or so...That's what makes a market :)

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  158. I don't think it will break 1358 ES or SPY = 136.21  That is only my opinion. The market makers can do whatever they choose.

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  159. Any idea why everything is up today?

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  160. the 'press' ing times baby..
    http://www.bloomberg.com/news/2012-02-16/obama-s-election-prospects-rise-with-economic-data.html

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  161. fwiw - the moon is currently in the more optimistic sign of Sagittarius today - the "sagittarius factor" allows for a certain amount of hope, optimism and blind faith - those trading futures may want to see what happens when the moon moves into the Capricorn "reality" tonight/tomorrow at 12:04 am EDT.

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  162. To shake off bears and to trap bulls.  My 2 cents.

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  163.  I got that.

    But even junk stocks? Even bonds are being dumped?

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  164. I see now. Agreed and good point!

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  165. TLT has sold off ONLY approx. 50% of its gains from Feb. 9th.  So market (stocks) are up here, but bonds are not back down there...

    Junk stocks are the perfect things to ramp up when the market is super bullish... right before it is super bearish, etc...

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  166. Looks like we're completing the final v of this current wave.

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  167. What's PL's target for that?

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  168. No number on today's SPX chart - but he was looking for another push up and we're above his blue 1355.87 spx line

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  169. Now what I hate to say is this could just be 1 of  5....

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  170. yesterday v target was 1358-1365 for ending diagonal

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  171.  I though SPX could go to 1375. But I was nervous about PL's signals. So I decided to stay out of it all together and pick on wounded stocks instead. Today is really, really screwy.

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  172. katzo, you seem a liitle quiet today. es did not make new high today. Do you think it will? According to Furrr, tonight reality should set in with capricon....

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  173.  He's in a meeting, he said.

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  174. All major indexes rose on lower volume today than during yesterday's drop.  AAPL could not retake the 50% retrace of its down move from yesterday's high to today's low (it didn't even get close).  The market is primed for a gap down on any bad news, but I would not make any specific bets on when or why it will.

    Not trading advice.  Just my opinion.

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  175. Hi folks.  I just wanted to tell you about an incredible article I found last week.  I honestly can't remember if I posted the link here or not.  If I've already done so, then please accept my apologies.  But I just re-read it and it's just so amazingly good.  It's written by Charles Hugh Smith and the topic is "fractals within the social network". 
    http://econintersect.com/b2evolution/blog2.php/2012/02/12/social-fractals-and-the-corruption-of-america

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  176.  Excellent article AR...too much to remark about to even start.

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  177.  Fwiw, not only AAPL couldn't climb through the 50% retrace, but the Euro hasn't yet either (except for 1 fakeout through and back)

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  178. This is what I see for today from an EW perspective - discussion welcome, 'cause I'm not PL - just trying to help.
    It looks like the v is not complete at this time and may move into PL's target zone 1358-1365 if an ending diagonal.
    If this is only 1 of  5, there will be a greater move higher after a 2 correction tomorrow.

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  179. Dow Theory:  Tranports showing party might be over soon, triple top in place

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  180. This is one of the few times I have held a short position overnight.  A minor position, but this seems an easy call.  I shorted the close at 1,358 and will hold this over the weekend if it becomes necessary. 

    This move started at 1,341 and has had only TWO retrace waves of two points the ENTIRE way. Which was from 1,349 to 1,347.  And then at the top from 1,358 down to 1,356 tracing out a two point range for the last three hours of trading.

    And that the SPX traced out the last THREE hours holding a two and a half point range is extremely telling as well.

    It's quite apparent that it was ALL about destroying short positions and probably destroying tomorrow's 136 strike put as retail bears simply do not have the resources to hold through a move like this or average this one down on the way up.  And they were given no retrace waves from which to jettison their positions.

    Last time something like this happened was last Tuesday and into Wednesday:  There was a twelve point uninterrupted move up from 1,337 to 1,349, which destroyed anyone who was on the wrong side of it.  There was then another three points of bouncing around for the rest of the day on Tuesday and into Wednesday morning that finally ended at 1,353 the next day and printed another incremental new high. 

    So it was a sixteen point move in toto.  And never a retrace of more than two and a half points the entire way.  A total shorts destroying affair that gave them no quarter.

    That was ALSO followed an eight point waterfall by mid-morning of Wednesday back to 1,342 as the market's symmetry and math finally came back into play.  Which it ALWAYS does. 

    Moves like this have their retrace waves.  Eventually.  And usually only AFTER the move has exceeded what retail participants can withstand. And after they have given up hope.

    At seventeen points into this move that has kept the fifteen minute Williams and Stochastics chart pegged to their upper ranges the entire day and which reached another newly printed high, I'd be very surprised if are three to five more points to the upside can be gotten out of this one before a meaningful correction happens.

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  181. Good observation. Makes total sense, since it is opex tomorrow, now that the puts are woryhless, what about the calls? Wouldnt the market makers want to make them worthless too if they havent sold yet yesterday?

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  182. GREAT analysis! I will go short tomorrow ASAP. Thank you much. From a channel perspective, I thought this was unplayable, as of today's close. Yesterday at the close (I can only do RTH) it was at the bottom of the channel. Today at the close it's in the middle.

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  183. Buy your put options at the open. :-)

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  184. Had a meeting from 2:45 to 5:45. Here is what I said early on "dollar dropped like a stone pulling fear vixes with it, ES above my 61.8%, this will take some time." I just get the feeling this was the last gasp, that this finalized the up move. I guess we will see tomorrow, BUT it will all based on the dollar; it goes up and mrkt will move down. Vixes did not go back down to their borttoms.ing fear vixes with it, ES above my
    61.8% this will take some time. "
    Hre is a 

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