SPX Took Out Wednesday's Cycle Low But Reliable SPX/Market Lead Indicator WMT's Held
SPX (http://stockcharts.com/charts/gallery.html?%24spx) took out Wednesday's cycle low, but, reliable SPX/market lead indicator WMT's held barely (http://stockcharts.com/charts/gallery.html?wmt), with a double bottom cycle low occurring at 45.50 today (shortly before the close) versus at 45.4779 on Wednesday, see http://finance.yahoo.com/q/ta?s=wmt&t=3m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
WMT is at 45.78 after hours right now, so, maybe WMT bottomed on Wednesday and is leading SPX/the market to the upside. Also, as discussed later, the WMT Lead Indicator turned very bullish late in the session, in that it's change from being bearish early in the session was dramatic. In absolute terms/measured from the open it was only a slightly bullish +0.08% versus SPX today, but, viewed from it's most bearish point early in the session, it became very bullish late in the session, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.
The WMT Lead Indicator must be viewed as a continuum to be used most effectively. The fact that it changed by about +0.70% versus SPX from it's most bearish point of the session today means that the important WMT Lead Indicator figure today is really that very bullish +0.70% intraday change versus SPX NOT the slightly bullish +0.08% change versus SPX that occurred from today's open to today's close.
WMT and SPX are trying to establish important cycle lows, with WMT trying to establish a monthly cycle low (http://stockcharts.com/charts/gallery.html?wmt), and, with SPX (http://stockcharts.com/charts/gallery.html?%24spx) trying to put in a Wave A cycle low of an intermediate term downcycle, see chart 1 at http://www.joefrocks.com/GoldStockCharts.html.
Reliable SPX/market lead indicator WMT may have put in a monthly cycle low at 45.4779 on Wednesday, see http://finance.yahoo.com/q/ta?s=wmt&t=3m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. WMT will have to do a strong short term Wave 1 upcycle in order to hit a monthly cycle buy signal, which would indicate that WMT has probably/very likely bottomed.
If you have long positions when SPX's Wave B peaks in a week or two (use the Elliott Wave count to time Wave B, and, a large bearish spike may occur on the candle the day it peaks), it makes sense to seriously consider taking some profits.
The WMT Lead Indicator was a slightly bullish +0.08% versus SPX today, but, it turned bullish toward session's end, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. Viewed from it's most bearish point of the session early in the session the WMT Lead Indicator turned very bullish today, which is a good sign.
The NEM Lead Indicator was a slightly bearish -0.09% versus the XAU today, and, it turned bullish late in the session, in that the gap narrowed dramatically, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Fed credit for the 5 day period ending 8-1-07 rose a substantial +$7.417 Billion, which is a good sign for SPX/WMT once they clearly bottom, see http://www.federalreserve.gov/releases/h41/Current/. Also, Fed credit was a massive $17 Billion yesterday, on punch spiking Thursday, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. Computer program index fund buying (and selling) is a huge factor, with SPX being the key lead index.
One of the few stocks that one might look to go long on Monday is JRCC, see http://stockcharts.com/charts/gallery.html?jrcc, which put in a likely intermediate term cycle low at 7.04 recently (note the bullish large inverse spike), and, hit an intermediate term cycle buy signal, because, it did a strong short term Wave 1 upcycle. It's now in the bottoming phase of a short term Wave 2 downcycle, and, may have bottomed at 7.50 late today, see http://finance.yahoo.com/q/ta?s=JRCC&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. Volume was an unimpressive 329,480 shares however.
TMTA (http://stockcharts.com/charts/gallery.html?tmta) may have bottomed today, but, looking to buy late in a short term Wave 2 downcycle or early in a Wave 3 up probably makes sense if you plan to trade this stock, especially since WMT/SPX need to establish bottoms now.
Some new potential trading stocks, including a few value type Warren Buffett stocks, are WFMI (http://stockcharts.com/charts/gallery.html?wfmi, potential breakaway gap at 37.04), HSOA (http://stockcharts.com/charts/gallery.html?hsoa, potential breakaway gap at 4.73), and OATS (http://stockcharts.com/charts/gallery.html?oats).
In this market especially, even if you're a daredevil, it makes a lot of sense to wait for a strong short term Wave 1 upcycle to trigger a monthly cycle buy signal, then look to buy late in a short term Wave 2 downcycle or early in Wave 3 up. Using cycle trendlines also makes a lot of sense. Usually at least one important trendline (important short term at least) will be broken before one should look to buy.
Often a bullish large inverse spike will occur when a cycle low occurs, which is a sign to look to go long. Conversely, often a bearish large spike will occur when a cycle high occurs, which is a sign to look to exit a long position.
Cycle trendlines/channels used in concert with Elliott Wave patterns and gaps are the basis/crux of "Trade the Cycles." "Gaps action" is very important.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
WMT is at 45.78 after hours right now, so, maybe WMT bottomed on Wednesday and is leading SPX/the market to the upside. Also, as discussed later, the WMT Lead Indicator turned very bullish late in the session, in that it's change from being bearish early in the session was dramatic. In absolute terms/measured from the open it was only a slightly bullish +0.08% versus SPX today, but, viewed from it's most bearish point early in the session, it became very bullish late in the session, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.
The WMT Lead Indicator must be viewed as a continuum to be used most effectively. The fact that it changed by about +0.70% versus SPX from it's most bearish point of the session today means that the important WMT Lead Indicator figure today is really that very bullish +0.70% intraday change versus SPX NOT the slightly bullish +0.08% change versus SPX that occurred from today's open to today's close.
WMT and SPX are trying to establish important cycle lows, with WMT trying to establish a monthly cycle low (http://stockcharts.com/charts/gallery.html?wmt), and, with SPX (http://stockcharts.com/charts/gallery.html?%24spx) trying to put in a Wave A cycle low of an intermediate term downcycle, see chart 1 at http://www.joefrocks.com/GoldStockCharts.html.
Reliable SPX/market lead indicator WMT may have put in a monthly cycle low at 45.4779 on Wednesday, see http://finance.yahoo.com/q/ta?s=wmt&t=3m&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=. WMT will have to do a strong short term Wave 1 upcycle in order to hit a monthly cycle buy signal, which would indicate that WMT has probably/very likely bottomed.
If you have long positions when SPX's Wave B peaks in a week or two (use the Elliott Wave count to time Wave B, and, a large bearish spike may occur on the candle the day it peaks), it makes sense to seriously consider taking some profits.
The WMT Lead Indicator was a slightly bullish +0.08% versus SPX today, but, it turned bullish toward session's end, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=1d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC. Viewed from it's most bearish point of the session early in the session the WMT Lead Indicator turned very bullish today, which is a good sign.
The NEM Lead Indicator was a slightly bearish -0.09% versus the XAU today, and, it turned bullish late in the session, in that the gap narrowed dramatically, see http://finance.yahoo.com/q/ta?s=^XAU&t=1d&l=on&z=m&q=l&p=&a=&c=^hui,nem.
Fed credit for the 5 day period ending 8-1-07 rose a substantial +$7.417 Billion, which is a good sign for SPX/WMT once they clearly bottom, see http://www.federalreserve.gov/releases/h41/Current/. Also, Fed credit was a massive $17 Billion yesterday, on punch spiking Thursday, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE. Computer program index fund buying (and selling) is a huge factor, with SPX being the key lead index.
One of the few stocks that one might look to go long on Monday is JRCC, see http://stockcharts.com/charts/gallery.html?jrcc, which put in a likely intermediate term cycle low at 7.04 recently (note the bullish large inverse spike), and, hit an intermediate term cycle buy signal, because, it did a strong short term Wave 1 upcycle. It's now in the bottoming phase of a short term Wave 2 downcycle, and, may have bottomed at 7.50 late today, see http://finance.yahoo.com/q/ta?s=JRCC&t=5d&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c==. Volume was an unimpressive 329,480 shares however.
TMTA (http://stockcharts.com/charts/gallery.html?tmta) may have bottomed today, but, looking to buy late in a short term Wave 2 downcycle or early in a Wave 3 up probably makes sense if you plan to trade this stock, especially since WMT/SPX need to establish bottoms now.
Some new potential trading stocks, including a few value type Warren Buffett stocks, are WFMI (http://stockcharts.com/charts/gallery.html?wfmi, potential breakaway gap at 37.04), HSOA (http://stockcharts.com/charts/gallery.html?hsoa, potential breakaway gap at 4.73), and OATS (http://stockcharts.com/charts/gallery.html?oats).
In this market especially, even if you're a daredevil, it makes a lot of sense to wait for a strong short term Wave 1 upcycle to trigger a monthly cycle buy signal, then look to buy late in a short term Wave 2 downcycle or early in Wave 3 up. Using cycle trendlines also makes a lot of sense. Usually at least one important trendline (important short term at least) will be broken before one should look to buy.
Often a bullish large inverse spike will occur when a cycle low occurs, which is a sign to look to go long. Conversely, often a bearish large spike will occur when a cycle high occurs, which is a sign to look to exit a long position.
Cycle trendlines/channels used in concert with Elliott Wave patterns and gaps are the basis/crux of "Trade the Cycles." "Gaps action" is very important.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. The primary Secular Bull Market trendlines since late 2000 are at 200-220 for HUI and at 85-90 for the XAU. Those are the targets for where the Cyclical Bear Market will bottom. NEM's Wave 2 Cyclical Bear Market began on 1-31-06. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:11 PM
