02/04/2012 Weekend Watering

[trendfollower]

Some levels to consider.

The Long Term Bull Market E Wave Count:

http://goo.gl/gt5Xx

[ocassional observer]

SPY broke downtrend resistance just to bump his head on another resistance from nov 2008 to form a large rising wedge.

the major averages are extremely stretched on the short term with rsi(2)>95 (QQQ=99.6) for all of them. also present are the negative divergences cobra mentioned.
on a longer term, the dow made a new high this week but transportation is lagging, a failure for transportation to reach a new high will form a dow theory sell signal, so this is something to watch. csfb levels are still indicative of a long-intermediate term top building:
http://www.bloomberg.com/apps/quote?ticker=CSFB:IND

fundamentally valuations and eps estimates are too rosy compared to actual earnings growth. profit margins are the highest ever and can only go down, and with russell 2000 fwd p/e of 19, the market is definitely expecting an explosive growth. furthermore, a rise in gasoline and good NFP numbers will prevent helicopter ben from starting another QE program.
to sum it up: internals are strong but overbought, the market is against longterm resistance and valuations are lofty. my advice is caution with tight stops going forward.

[rhight]

Good morning weekend warriors,
Shown is the latest update to the Time and Price Projection chart based on the prior 6 Daily swings (requiring the past 7 highs and lows). Each box represents the Average +/- 1 Standard Deviation in both the time and price axes. Since there are only 6 samples in the set, there is a degree of uncertainty that is not calculated. But, this is in keeping with Robert C. Miner's philosophy that the only the most recent market action is considered. The first chart shows the data points entered:

The second chart shows the past 3 results, plus a projection based on the supposition that the 2/3/11 High is it for this intermediate move. These boxes are not so much predictions as they are a way to compare the latest price action to recent price swings. As you can see, the current Daily price swing high has exceeded the Average +1 Std. Dev. in Time, but is still in the Price range. Therefore, it could be said that we are starting to "push the envelope" with this current move. Another way to measure this is to note that the current move (measured High to High) is 1.618 x the prior swings. Based on these statistics, any correction from here has a good chance of making a "higher low", enough to keep the up trend from the October 2011 low intact.

[Al_Dente]

It’s not that the Eurozone is “fixed,” it’s that the perception of the EU crisis now seems to accommodate some kind of “reasonable” resolution,
whatever that might be. And the mkts have always been the price-discovery mechanism for investor perception.

Here’s an update of the EUzone vs U.S. bank charts, showing $BKX sprinting ahead once again.
http://stockcharts.com/h-sc/ui?s=$BKX&p ... =252469497

And a different measure showing a similar leap/lag between the U.S. dow/banks and the EUzone dow/banks.
http://stockcharts.com/h-sc/ui?s=$E1DOW ... =249095647

TED SPREAD is full risk-on (credit is easing)
http://stockcharts.com/h-sc/ui?s=$TED&p ... =248214703

And the old mongoose link to EU yields, updated daily
http://graphics.thomsonreuters.com/F/09 ... PORT2.html#


“I give 98 percent of my mental energy to Chess. Others give only 2 percent.” [Bobby Fischer, Chess Grandmaster]

[Al_Dente]

PAGING AMZN and BIDU (China internet sector)

AMZN is now selling “collectibles” …(announced Thursday) http://www.auctionbytes.com/cab/abn/y12/m02/i03/s03

“Amazon: 11 patent cases, $771M in acquisitions, and zero specifics on Kindle sales”
http://www.geekwire.com/2012/amazon-11- ... ndle-sales

BIDU is almost breaking above its 200dma and may soon test its Dec highs
Here’s some interesting CS neg kool-aid on user polls etc: http://screencast.com/t/hENEQIovft
And a Ned Davis Research chart on BIDU seasonal cycles (any cycle experts who have a good “read” on this, please post/share)
http://screencast.com/t/L8ERNQB0F
btw BIDU reports eps on 2/16. consensus est is $0.89.

[xglider]

SPY broke downtrend resistance just to bump his head on another resistance from nov 2008 to form a large rising wedge.

The attachment spy feb 4 12 weekly.jpg is no longer available

the major averages are extremely stretched on the short term with rsi(2)>95 (QQQ=99.6) for all of them. also present are the negative divergences cobra mentioned.
on a longer term, the dow made a new high this week but transportation is lagging, a failure for transportation to reach a new high will form a dow theory sell signal, so this is something to watch. csfb levels are still indicative of a long-intermediate term top building:
http://www.bloomberg.com/apps/quote?ticker=CSFB:IND

fundamentally valuations and eps estimates are too rosy compared to actual earnings growth. profit margins are the highest ever and can only go down, and with russell 2000 fwd p/e of 19, the market is definitely expecting an explosive growth. furthermore, a rise in gasoline and good NFP numbers will prevent helicopter ben from starting another QE program.
to sum it up: internals are strong but overbought, the market is against longterm resistance and valuations are lofty. my advice is caution with tight stops going forward.

I noticed the ascending wedge this weekend as well, its almost like we have a wedge within another wedge. We have the 5 touch requirement for a breakdown at this point if this is a valid pattern for where we are.

[BullBear52x]

Thank you all for keeping the snake weekenders' culture moving.
Do I hear overbought? the question should be how long can you stay solvent?
My focus:
1. If the bull run is for real new high will be made. This is still "IF"
2. Even if the new high is made a pull back, back test, or overbought relief will be to follow. >90% chance there will be a pull back
3. short term RSI is way over due for a short term correction ( see Occasional observer post ) and other TA also suggesting the same.>80% chance there will be a pull back
lets look at the chart of what to come if history is any guide

zoomed up

no new high resistance is still live and well.

[usctrojan99]

We all know based on our TA and EW lines/waves that a pullback will come. However, the market doesn't want to sell, and we can drift up and take a breather and rinse, and then repeat. This week, we dropped to 1300, and went up 45 points on the S&P for the rest of the week. The market is frothy and high P/E stocks are en vogue. When you see rotation to the high beta stocks, this shows the risk trade is on and people are willing to support this market with Bernanke.

That 45 point move (1300-1345) was telling. When people thought we needed to correct, we didn't. The market is not going to do what waves and TA expects it to. We're just 55 points away from 1400. From December, we've rattled of ~ 150 points on he S&P. Another 50 points doesn't see far fetched any more. I am long and plan on adding to my positions.

[BullBear52x]

Friday proved to the bears once again bull mean business, a renew strength. for that swing sell is null, a buy continuation pattern as shown here is my best guess. why I drawn down arrow before up arrow? over 5 mil shares trade at the close and we closed high, fade the volume mentality we should get a weaker open in the morning.

[Cobra]

[SWalsh]

Some levels to consider.

The Long Term Bull Market E Wave Count:

http://goo.gl/gt5Xx

I'm looking at that wave 4 he has labeled and I couldn't draw a better 5 wave move down. But thinking the rally up has been wave 2 of that degree sure has had a lot of people selling the mkt as it pauses each time and indicators turn.

[Seawaves]

[waverider]

Thanks for all the charts and insights this week Cobra and everyone. At the moment, there are extreme levels of optimism, so at minimum a minor pullback should be expected.

"The life of a turkey before thanksgiving is illustrative: the turkey is fed for 1000 days and every day it seems to confirm that the farmer cares for it-until the last day, when confidence is maximal. The "turkey" problem occurs when a naive analysis of stability is derived from the absence of past variations."

-Nassim Taleb

[xglider]

Guys, check this out:

http://www.mcoscillator.com/index.php?/ ... t_top_now/

Interesting indicator

[Al_Dente]

The new lows (61) at Friday’s fresh spy high are a chink in the bulls armour
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =253140071

Breadth is bullish, and the top/bottom signals on $NYADV (Cobra’s) are silent
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =204362179

The ratio $NYHGH:$NYTOT and the net new highs $NYHL are signaling a top/top zone. (You can see signal failures marked in blue dashed lines)
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =251929526

All volatility hit fresh lows, and all pierced the lower bolinger bands except $RVX (small caps) and $OVX (oil).
http://stockcharts.com/h-sc/ui?s=$VIX&p ... =256313540

$BPINDU is extreme at 96.67. The last time it hit 96 was April 2010, at what looks like (see pink) one week before the high.
($BPSPX and $BPCOMPQ are not at extremes; they’ve been higher just last year).
http://stockcharts.com/h-sc/ui?s=$INDU& ... =250487270

http://www.youtube.com/watch?v=j_FLLz4U ... re=related

[Cobra]

The new lows (61) at Friday’s fresh spy high are a chink in the bulls armour
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =253140071

Breadth is bullish, and the top/bottom signals on $NYADV (Cobra’s) are silent
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =204362179

The ratio $NYHGH:$NYTOT and the net new highs $NYHL are signaling a top/top zone. (You can see signal failures marked in blue dashed lines)
http://stockcharts.com/h-sc/ui?s=SPY&p= ... =251929526

All volatility hit fresh lows, and all pierced the lower bolinger bands except $RVX (small caps) and $OVX (oil).
http://stockcharts.com/h-sc/ui?s=$VIX&p ... =256313540

$BPINDU is extreme at 96.67. The last time it hit 96 was April 2010, at what looks like (see pink) one week before the high.
($BPSPX and $BPCOMPQ are not at extremes; they’ve been higher just last year).
http://stockcharts.com/h-sc/ui?s=$INDU& ... =250487270

http://www.youtube.com/watch?v=j_FLLz4U ... re=related

Thanks, Al, I believe I never told you that I think your charts are awesome.

[xfradnex]

I will guess which way the general market is going, but based upon resent OH and OL patterns on the S&P, I will make a guess as to monday's Highs and lows (see graph). Since we had 4 Open to High days in a row well above zero (bullish), I don't think we would likely have another one(rare occurance). Normally, I would guess we would gap down after a day like friday, but since everyone is still bullish, patterns indicate a good OH around 7.5 (supported strongly with my revisit data). On the OL side, there have been 3 near zero days in a row; probabilities indicate jump between the -7 to -15 range (+patterns). Again,since we are bullish, and there some good intersections in the -7 to -9 area, along with good revisits at that level -7 to -9, this would make a good low. See the revisit chart. The Vertical highlighted sections are absolute value High and Low revisits over 100 days. To the right of that are a group of OH/OL revisits summed in different time frames. To the left of that are revisits Open to Close values summed in different time frames.

[dcurban1]

Say goodbye to Greece.

Euro zone loses patience with Greece

http://news.yahoo.com/eurozone-loses-pa ... 51357.html

The debt camps are fragmenting.

Creditor chairman: others should chip in on Greece

http://news.yahoo.com/creditor-chairman ... 36160.html

Can we keep pushing it up until the Bradley turn in mid-March which coincides with the Greek debt payment?

[speck]

Hi everybody!
It's my first post here, so don't be too cruel on me, TA sharks!)))
The chart says it all.

[su_root]

I hope you all have a good weekend and manage to think about something else than next weeks stock market.

Here is some averages for them who likes numbers (stats taken from http://traders.fi/Indeksit/SP500 )

Days average rise low to high 44, last high to new high 67. At the moment, SPX low to 1344 = rise of 75 days and last high to 1344 is +133 points which is over 2 x the average. Average bottom to new top is 134 points and average new high is 29 points. At the moment, bottom to 1344 is 186 points and last high to 1344 is 51 points. As you can see, we are beyond all averages at the time of writing. Biggest movement before pullback was 233 points (or +34,4%). The average movement in % is 13,4% and at the moment the movement from last bottom to 1344 is +16,06%. 4 times since 2009 bull, we have moved over +16% (+34,4% , +17,1% , +17% & +20,3%). Based on these averages, we are getting very close to the upper limit since the +34% move was an overshot pullback.