05/12/2012 Weekend Discussion

[cougar]

Interestingly, Friday's P-bar hits right at the top of a possible bear flag.

Interesting observation Clark! I am not a fan of P-bars but this one goes to an interesting level.
On My SPY fast Renko, which is by definition more permissive with numbers, we might have a “Gann rule of 4 in the making”. Sine higher lows would precede this putative #4 hit (as you correctly marked on your chart) a successful break of the a level right under 137 should happen, with a high P. So…above 137 FROM THE FIRST TRY, SPY can be followed UP with a lower than 0.5 risk…IMHO.

However I would follow it closely , with a progressively tightening trailing stop…’cause I don’t trust THEM!

[cougar]

A few words on GLD Cycles.

[1] We deal with only 2 harmonic cycles, which obey the rules (proposed by J. M. Hurst) of ”synchronicity” and “proportionality”. However, they were established and analyzed with additional tools unavailable to Hurst in the early 1970s. The small cycle (blue) increased in strength, starting with Oct 2011, as GLD lost “alpha” and gained “beta”. Thus, it acquired a higher “price-expressed significance”. Since variance in the blue troughs is relatively small, I take the chance of proposing a “nest of lows” at the end of June 2012 (*), as marked on the chart.

[2] To better analyze the present and to propose the next blue trough, I moved to a 60 min chart. It appears that GLD is now close to the 152.5 support. After breaking it, GLD should go to a next trough (supported by 149 = 161.8% ext.) around May 22.
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(*) According to some views this date might roughly coincide with the time target of the bernank for letting loose the QE3 upon us! LOL!
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All this…IMHO. I am sure that everyone here understands that this is a game of numbers and not an advise to act according to my views.

[SWalsh]

Seems like many E-wavers are calling this down move off 1400 level as a wave 4 and accordingly, a wave 5 should commence soon, last through the summer and take us to the election. This also fits the three peaks and domed house pattern, with point 23 (approx. 1576) coming up around last half of July 2012.

The central bankers continue to accommodate wall st., this will not change until after the election. The only real question is how low they allow the markets to drop before this wave 5 begins. My guess is this wave 4 ends once we dip to 1316-1333 range.
Then a blast off of 250 points to 1576 !!

Most E-wavers have a strong propensity to not follow rules and are generally wrong. But with intervention, and what has to be a War Room to keep the bull going, highly reliable patterns have been repeatedly broken.

I'm not in the "this is wave 4 camp" until the mkt proves it to be. My primary count believes that this is looking more like a complex correction wave 2, and a strong down wave 3 will follow and as most E-wavers missed the moves up they will miss the wave down. I'm not much positioned for it just yet, but I am looking for it. That's what traders do. Yes, BTFD has been workable because of the following article. But nature sometimes gets it's way! This market should never have seen SPX 1000 and our problems are now worse and there will be no recovery. Debt must be deleveraged....PERIOD!

Wondering why no one goes to jail and Wall Street is manipulated with approval by this criminal administration? Read on:


"Obama delivered heated rhetoric, but his actions signaled different
priorities. Had Obama wanted to strike real fear in the hearts of
bankers, he might have appointed former special prosecutor Patrick
Fitzgerald or some other fire-breather as his attorney general.
Instead, he chose Eric Holder, a former Clinton Justice official who,
after a career in government, joined the Washington office of
Covington & Burling, a top-tier law firm with an elite white-collar
defense unit. The move to Covington, and back to Justice, is an
example of Washington’s revolving-door ritual, which, for Holder, has
been lucrative–he pulled in $2.1 million as a Covington partner in
2008, and $2.5 million (including deferred compensation) when he left
the firm in 2009.

"Putting a Covington partner–he spent nearly a decade at the firm–in
charge of Justice may have sent a signal to the financial community,
whose marquee names are Covington clients. Goldman Sachs, JPMorgan
Chase, Citigroup, Bank of America, Wells Fargo, and Deutsche Bank are
among the institutions that pay for Covington’s legal advice, some of
it relating to matters before the Department of Justice. But Holder’s
was not the only face at Justice familiar to Covington clients. Lanny
Breuer, who had co-chaired the white-collar defense unit at Covington
with Holder, was chosen to head the criminal division at Obama’s
Justice. Two other Covington lawyers followed Holder into top
positions, and Holder’s principal deputy, James Cole, was recruited
from Bryan Cave LLP, another white-shoe firm with A-list finance
clients."

- Peter J. Boyer in his excellent recent article “Why Can’t Obama
Bring Wall Street to Justice?”

[Al_Dente]

ADVANCE/DECLINE
You can see on the top panel, the “cumulative” A/D breadth measures are hitting lower lows (except large cap),
while on the bottom panel, the $NYADV (not cumulative) is zig-zag bouncing with higher lows.
On the bottom panel: I like to wait for Cobra’s signal line (green bottom line) because it has fewer failures.
The Al Dente pink kool-aid line (which has more fails = blue circles) signaled a bounce (bright green circle) over a week ago,
but it bounced before it could deteriorate down to a Cobra solid-bottom signal.

Isolating just two A/D measures from the chart above, this one show how the cumulative $NYAD breadth by itself (courtesy Michelle)
is taking a breather after a quad (cinco?) top, and still shows higher lows at this point.
Bottom panel cumulative $NYUD (black line) by comparison, hit lower lows and is a bit bearish.

PAGING Baron von BearBear51x: I’m trying my best to see the bull AND bear view this weekend.
Did u notice how many times I used the word “bounce” above, plus I used lots of green…

[Al_Dente]

Cobra
Please pop in again and remind us to VOTE with link

[cougar]

BTFD…of $VIX: 1...2...3...4!
However…be careful! Only 2 trading days left to $VIX OpEx!
Manipulations here are DEADLY!

[cougar]

Volpinacci got his BUY orders for CHK…and he is a serious BOT, with no sense of humor!

[cougar]

AAPL to form a double bottom at ~554.5 = a too crowded trade!

[BullBear52x]

Good morning!
Here is IWM for BullBear:

On my daily chart, IWM is in a box. Until it gets out of it, I would not take any directional unhedged positions. If it breaks down, it becomes more interesting… because after breaking the old-fashioned 50% extension (75.1) it should stop only at the top of the lower stack of harmonic extensions ~73.7. Such extensions are right now validated since the BOX (yellow) "established itself" between 2 such levels. [1].
Altogether, the daily mode is still SELL.

So…how am I trading it? Let’s go to the next 5 min chart [2].
I do one of my tricks, explained many times in the past: on SELL signals I go long “back-month puts” and on BUY(if I am substantially in the green) I sell to open front-week puts - preferably on Thu morning, when that combo is in backwardation. Right now I am long IWM Jun 78P and short May 79P. This time spread has a bias: ratio = 4 longs / 3 shorts. I am well in the green.

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Exercise Q for “nubies“: Why do I often keep such a bias overnight?

Thanks Cougar.

[BullBear52x]

PAGING Baron von BearBear51x: I’m trying my best to see the bull AND bear view this weekend.
Did u notice how many times I used the word “bounce” above, plus I used lots of green…

Sure, having fun with my bullishness avatar I use all of the color, this time it just happened to be red, see my blog, I am remote, well, it is what it is boss. next week will be slow week for me, family come to visit, wishing all making a killing in the week to come, I only 20% invested


***another one of a great weekend discussion, Thank you all***.

[TraderGirl]

Monday is supposed to have another big move...the direction is most likely down...and then there is a turn on Tuesday/Wednesday.

[xfradnex]

Volpinacci got his BUY orders for CHK…and he is a serious BOT, with no sense of humor!

Cougar you always seem to find jewels. I found more info. http://online.wsj.com/article/SB1000142 ... d=yahoo_hs . I think this fall is probably pure manipulation. Also http://messages.finance.yahoo.com/Stock ... f=16&off=1. Notice the current exhaustion bars surpassing 2008 crash below (last chart). There was one more move down in 2008 after the highest Bar. Maybe the move on friday is it(not visable on first graph); see first chart. In after hours trading, the price is up on this newshttp://finance.yahoo.com/news/chesapeak ... 37592.html CHK going to the loan sharks.

[taggard]

very amusing read on the dodd frank law and what's going on with it. the short version is that any even halfway serious approach to this stuff is going to have to wait till the next crisis. and the obvious call is that the failure of the regulation to get passed in any meaningful form should ensure the next crisis.

the good news for traders is the whole situation should result in "increased volatility" which is what trading is all about. the bad news for at least 80% of the population it's very likely food and other really basic gotta have items are going to increase in price--or decrease in quality (such as the shift from half way decent farming in the 1900-1940 to corporate farming to genetically modified food--where net net there was (for example) a measurable decrease in anti oxidant compounds in vegetables and fruit over the 100 year period which if you are doing the reading is not a good thing for your health)

the whole situation is unfortunate but hey--this is what we have to play with. so rock on--and watch the stress levels as stress uses up anti ox compounds. Stay frosty.


http://www.rollingstone.com/politics/ne ... print=true

[TraderGirl]

China cut its reserve requirement ratio:
http://www.zerohedge.com/news/much-anti ... ation-race

[Al_Dente]

Facebook IPO watch:
There is now a hashtag devoted to tweet updates on “hoodiegate”:
#zuckerbergshoodie

[Cobra]

Cobra
Please pop in again and remind us to VOTE with link

Thanks, Dr. Al. Today's is the day to remember, can I from now on hold above 300 followers (http://stockcharts.com/public/1684859)? Thanks for all the vote and follow!

[Cobra]

Facebook IPO watch:
There is now a hashtag devoted to tweet updates on “hoodiegate”:
#zuckerbergshoodie

I heard Sentimentrader said that the IPO demand is not good.

[Al_Dente]

HAPPY MOTHER’S DAY TO ALL MAMAs
http://www.youtube.com/watch?v=ziFI_0Fx5ts

[BullBear52x]

Mother day special chart.

Fibbo combo and bottom analog

[Seawaves]

NYMO double positive divergence!