Analyze This

In case you missed it earlier on Zero Hedge; BOE's Haldane summing up "An arms race". A little theater goes a long way, as they know in GB.

Natural Gas has finally achieved its C=A long term target off the 15.78 high of Dec. 2005. The initial A wave down bottomed at 4.05 in the autumn of 2006, a move of 11.73. The B wave carried up to 13.70 in 2008 before beginning the current move down.It hit an interim low of 2.40 in 2009 for the a of C Even though 1.95 was my early long term target , the  the 2.40 low was so significant, providing a springboard for a 250% move up to 6.11, and held so long, 2.5 yr.s, that it argued strongly against fresh lows before a serious new high, BUT... Here we are, finally achieving the C=A around 1.95. Weekly click to enlarge This last leg, the c of C, can be counted as having a 5 wave complete, or VERY nearly. Note the minor divergence on the RSI, and shrinking volumes. Daily Again some positive divergence on the RSI coupled with shrinking sell side volumes.  Can it grind a little lower? Sure...previous lows from 2001 at 1.88, and the C wave structure has  c= .382 0f a at 1.79. BUT   

While the macro environment has been seriously frightening for the last 6 mo.s, equities have of course defied all logical expectations and continued their record climb through the 1st qtr. The SP500 retraced  82% of it.s move down getting to 10% off the all time highs . Most bears have attributed this to the liquidity pump provided by central banks, with bad fundamentals stoking expectations of more stimulus. Coupled with the lousy internals of the rally (see RSI, volume, breadth and complacency), it,s been difficult for this thinking human being to get bullish, and equally difficult to be willing to get bearish. So I have refrained from making any calls since Dec. 8 2011, Until now. SP 500 Daily  click to enlarge Chart really says it all;   Weekly click to enlarge The 50% retrace of the last move up from 1078 is around 1248. The .618 retrace of 666 to 1422 is at 955.