Cobra's Market View

DWCF Weekly Update
http://99ercharts.blogspot.com/2011/10/dwcf_28.html

Have a good one!

well, what can i say. it seems all bets are off here, but the fundamentals remain: europe is already in recession at large (france and germany will join shortly), the us will enter a recession most likely by dec-jan. china's property bubble is in the early stages of collapse. the cracks in its financial sector should be apparent by the 2nd half of 2012. this will drag most comoddities down hard.
the move in the market suggests continuation after a pullback, as what i consider to be part of a larger topping process. however, i do not expect higher highs here. earnings estimates have turned decisively down, and i just don't see the catalyst for further gains once investors actually understand what europe "gained". however, the reaction of the markets indicates greece is not lehman. i believe that role belongs to italy. the point of no return lies at ~7% yield on the 10y bond.
as for trading: SLV seems primed to short reaching 50d,200d,50week convergence. IWM is weaker than the rest, reaching 200d, 50 week resistance in overbought conditions.

I just dont understand this china property bubble. They have a surplus, they dont have any mortgage backed security issues and they are a "savers" economy. This is just scare tactics by the media.

Good morning!

VIX is back in jail. One can notice the narrowing of the envelopes = sign that its intrinsic volatility is decreasing.

Let us look again at the BUY signals that the 2 nested envelopes can generate:
1. a consolidation under the Acceleration Channel (blue ellipses)
2. a crossing of the lower limits of the 2 channels (labeled on chart by green X-s)

They usually happen at in a narrow time interval, in the 1-2 sequence, for the obvious reason that the large envelope needs some time to catch up…
Such envelopes generated signals should be corroborated with other signals, generated by independent indicators, also present on this chart.

RIGHT NOW: my interpretation of what I see is that one should not buy or sell VIX, but watch it carefully, because it could become a BUY soon...during next week.

=====
Note: The strategy presented above is valid for large VIX waves, typical for strong down corrections or bear markets…If VIX will keep on lingering here or drop slowly on a mild slope… this might be a sign that this “system” could stop working altogether…This should be a very bullish sign for the market in general.

My biased view, however, is that this will not happen!

Fundamentals and technicals synergized for Carbo Ceramics (CRR)…who was lucky enough to present an outstanding Earnings Report, as it was climbing above a continuation bullish triangle, on the day of the European Bang! The large “short interest” completed the job.

Since it met a strong resistance at the intersection of 2 fan lines, it is no more a buy. It will be a buy again if it retraces and then bounces again from the zone 128-135 zone.

pady wrote:I just dont understand this china property bubble. They have a surplus, they dont have any mortgage backed security issues and they are a "savers" economy. This is just scare tactics by the media.

you can find plenty of information about this on the web, so i'll be short: the problem there isn't in the level of households, it's in the debt by businesses and local governments, not much different than the Japanese bubble of the 80's, and it will end rather similarly.

Good Morning.

Reviewing some charts, I think we may have already passed the local top in equities; the DWCF chart posted earlier, with three points creating an upper channel line, hints at this possibility. Check out some of the updates which follow: I really don't see anything bullish about stocks now.

SPX http://99ercharts.blogspot.com/2011/10/spx_29.html
RUT http://99ercharts.blogspot.com/2011/10/rut_29.html

ES http://99ercharts.blogspot.com/2011/10/es_29.html
NQ http://99ercharts.blogspot.com/2011/10/nq_29.html

Have a great weekend!

In spite of a GAP UP on Thursday, NDX is still cycling.
The oomph is simply not there to push it impulsively above the now mildly ascending channel.
=====
Sold my QQQ calls and again waiting for clarity…

99er wrote:Good Morning.

Reviewing some charts, I think we may have already passed the local top in equities; the DWCF chart posted earlier, with three points creating an upper channel line, hints at this possibility. Check out some of the updates which follow: I really don't see anything bullish about stocks now.

SPX http://99ercharts.blogspot.com/2011/10/spx_29.html
RUT http://99ercharts.blogspot.com/2011/10/rut_29.html

ES http://99ercharts.blogspot.com/2011/10/es_29.html
NQ http://99ercharts.blogspot.com/2011/10/nq_29.html

Have a great weekend!

99er: just saw your post...I guess we agree...

Updates

Copper http://99ercharts.blogspot.com/2011/10/copper_29.html
Crude http://99ercharts.blogspot.com/2011/10/crude_29.html

Gold http://99ercharts.blogspot.com/2011/10/gold_29.html
Silver http://99ercharts.blogspot.com/2011/10/silver_29.html
30-Year http://99ercharts.blogspot.com/2011/10/30y_29.html

Is everything going to tank soon or do I need to take a break?

cougar

Let's see what BB52x and other have to say this weekend. If we're all on the same side of the boat, there should be some rocking ahead. I'll be back tomorrow with some FX charts and will look for Volpinacci's latest and greatest. See ya.

Thank you everyone, hard core TA as usual. all I need to say is don't let the fundamental bias overcome your charts, I said that because right now is high season of counter trend trading, Top of some kind, major resistance and all, but as we all know and understand TA only give us probability, know when to fold or hedge to gain the best of it. I really appreciate your posts here.

Why does your chart begin at 2? In another blog I frequent, a member is arguing/presenting a case now that the 38.2% retracement on the SPX that ended on October 4th was wave 4 of P2 and we are currently in wave 5 to new highs. I was under the impression that there were a clear 5 waves up on most indexes. However, perhaps what many are labelling as the wave 2 decline was merely a 1-2. When looking at many of the indexes on a monthly chart, it appears that the top on May 2 may have only been a wave 3 and this fellow is correct.

Do you have any thoughts on this?

99er wrote:DWCF Weekly Update
http://99ercharts.blogspot.com/2011/10/dwcf_28.html

Have a good one!

Bobo and 99er: I appreciate that bullish point of view. There are actually some additional other alternatives. EWT cannot predict right now which count is correct. Until the present scenario is negated, I will keep using it …for “punctuation” purposes only.

Also, notice that on Nov 25 we have a powerful “Time Vibration”.

bobo

The numbers are not Elliott Wave counts but points in a Wolfe Wave. The "1" has already scrolled by. While some EWT folks believe that there may be another small wave up (which is reflected in some of my charts as the blue line up and which has not quite been fully reached), other indicators tell me that the local top is already in. Will EWT folks get the rug pulled out from under them? Won't know until later and in any case I don't mind being early to an important pivot. It's all about one's appetite for risk/reward after all.

GLTA.

Lets take a look at Fear and carry trade:

Positive D on VIX
Negative D on DBV
Overbought on EUR/USD
Oversold on $USD looking at this 3 major indexes fear indexes they're all showing the same path.

I see. However, do you have an opinion on what I was asking?

99er wrote:bobo

The numbers are not Elliott Wave counts but points in a Wolfe Wave. The "1" has already scrolled by.

Well blow me away! All the money managers were hedged for a down turn (just making this up, don't really know, but I read that short interest was still high as of last week) and what happened? It turned back of course, at the same time as there were equity fund outflows. The whole show is heavily influenced by FX now, and that is both a political football and traders playground. Good luck with that! My system generated a sell signal during the mid-October consolidation, but that was never executed as the consolidation pattern led to a continuation rather than reversal. And so, that sell signal is canceled, and now I wait for a new sell signal with the uptrend still in place. If you remember (and I doubt that ), I was 1 day and 10 points off from calling the bottom with an 10/5 buy signal. If only I could figure out how to make money off of this! Anyways, I doubt I'll be as successful this time, but what the hell. How about 11/7 and 1300 for an intermediate term top? Not selling it? I don't blame you.

Few equities display clear and unambiguous technical setups. Among them, I like PALL with its Gann Fan.
PALL 130 min update:

Very interesting discussion going on here…
Too bad that I have to leave. See you guys later!