Showing posts from July, 2015

Crude Bounce

Is this bounce a dead cat, or is it sustainable? Do equities crater in China, does the USD continue it's move up? These are the factors. CLU15 Contract  click to enlarge CL Nearby  click to enlarge It does look like a potential 5 waves down. It IS oversold. But there is no real positive divergence on the RSI, something good to have in place for a pivot.  So far no evidence of impulse wave up structure, it looks more like an abc corrective structure.  However the short term can evolve and there is a .78 retrace on the above nearby chart. Jack be nimble.

Monday Morning Indu Blues

Leading the way in the US, the INDU is about to make new lows for the last 6 mo.s, since Feb 3 to be precise, as it takes out 17,354.  Is it any surprise really? The worlds 3rd biggest equities market, China, has been essentially non functioning for the last 3 weeks. click to enlarge SP click to enlarge Trailing the Dow , doesn't 1968 look like it's just begging to be tested?

INDU / SP Fibonacci Update

Does this stuff work? Yes but .... Lots of buts in the world of waves and Fibonacci relationships, not to mention massive world wide Central Bank interventions completely distorting price discovery usefulness of markets, etc still take a gander; INDU click to enlarge SP mini click to enlarge The Dow found support yesterday at the .618 retrace and the E mini at the .382 retrace. Presumably the Dow is leading, or at least weaker, and both are responding to Fibonacci "magic". Looking a little further both charts record a sideways range market over the last 9 mo.s- not easy to interpret. Is it a consolidation prior to new highs and how strong will that move be? Or are these charts reflecting an exhausted market failing to respond to CB intervention and rolling over? INDU click to enlarge The Dow is weaker so perhaps leading the way.  In the W structure c= .48 of a. X = .48 of W. In the Y structure c= .55 of a Y= .49 of W Obviously ne

SP Poised After .618 Retrace

Elliott Wavers alert! After a 1st wave down the SP has retraced .618 of that, as of this morning, to complete a 2nd wave. And we all know what happens next; 3rd waves are typically a significant multiple of the 1st and that was 87 points. click to enlarge A 3rd wave of Fibonacci multiple 1.618 from this mornings high of 2084 targets 1981, and  if 3 = 2x 87.5 than its 1909 etc. My hot tip for buy of the year;

China Shanghai Comp 50% Retrace

Yes thats right, at the lows of today, the comp has retraced 50% of the last years move up. That is a common rule of thumb measured target for a correction, and certainly a Fibonacci number. Beware shorts. Under that 3200 as the .618 retrace and 3050 4th wave of lesser degree offer support. click to enlarge Unfortunately for the Chinese (and the rest of us), that is merely a short/medium term picture. Longer Term the risk of continued downside is high.  15 Year Chart / Qtr. Bar click to enlarge The "B" wave on this 15 year chart is a classic abc zig zag structure in Elliott Wave theory, retracing a Fibonacci  .78 of the A leg down.  The "C" wave down measured targets are; C=A at 718  C=.78 of A at 1700 C=.618 of A at 2422 Entire History of Comp click to enlarge Note the lows on this very long term chart are overlapping the preceding highs, suggesting an abc structure history. from the May 5 post China Shanghai Comp Why

Crude Chops Lower- for now.

I've been negative on WTI since early May, see May 12 post WTI Hits Target etc . I believe it still has a couple of bucks of downside in it, but so far, the move looks corrective and choppy, rather than a new primary wave down. (How that fits with a VERY negative outlook for world equities I don't know .) click to enlarge Meantime looking for continued weakness to the .618 retrace level, nearly c=a, and then I go neutral.