The Major Averages Will Probably Be Weak Early Tomorrow
It looks like SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24hui) entered a very short term Wave C downcycle late today of the very short term downcycle that began yesterday, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, which jives with the WMT Lead Indicator becoming more bearish toward session's end (-0.53% versus SPX (S & P 500) today 2-28), 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.
There might be an opportunity to day trade the major averages short early tomorrow, but, I'm more interested in looking to trade the major averages ultra long via QLD, SSO, or UWM once a very short term cycle low occurs (probably early to mid session tomorrow), because, SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) are probably in a short term Wave 3 upcycle now.
SPX (S & P 500) and NDX (NASDAQ 100) probably put in a short term Wave 2 cycle low on 2-7-08, and, probably put in a Wave 2 down cycle low on Friday 2-22 (note the large bullish inverse spike on Friday's candle) of a short term Wave 3 upcycle, see http://stockcharts.com/charts/gallery.html?%24spx for SPX, and, see http://stockcharts.com/charts/gallery.html?%24ndx for NDX.
RUT (Russell 2000) however probably just put in a short term Wave 2 cycle low on Friday 2-22, see http://stockcharts.com/charts/gallery.html?%24rut, note the large bullish inverse spike on Friday's candle.
I'll look to day trade the major averages ultra short early on Friday (using the intraday/very short term Elliott Wave count) via QID, TWM, or SDS.
Wave A intermediate term (Cyclical Bear Market began 10-11-07 for SPX, late October 2007 for NDX, late July 2007 for RUT) cycle lows occurred on 1-23 for SPX/NDX and on 1-22 for RUT (Russell 2000), so, SPX/NDX/RUT are in a countertrend Wave B minor intermediate term upcycle.
The Rollover/Upside Surprise Barometer is at neutral, since Fed credit declined by a modest -$253 Million in the five day period ending 2-27-08, see http://www.federalreserve.gov/releases/h41/Current/ . However, Fed credit was a humongous $41 Billion today 2-28, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE, so, there might be a good entry point to trade the major averages long tomorrow, as discussed earlier.
HUI (http://stockcharts.com/charts/gallery.html?%24hui) has only risen +1.97% the past six weeks, from 1-14-08's cycle high at 489.49 to today 2-28's cycle high at 499.12, which is obviously not a healthy linear upcycle, but is bearish dramatic rollover action.
A Wave 1 Cyclical Bull Market (began late 2000) cycle high is probably imminent for HUI/XAU. Wave 1 obviously implies that there should a Wave 3 and a Wave 5 Cyclical Bull Market in the future, but, a 12-18 month Wave 2 Cyclical Bear Market should soon begin.
See the extremely bearish five day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem, and, see the extremely bearish three month NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The NEM Lead Indicator is extremely bearish in February, at +0.29% versus the XAU on 2-28, at -0.58%, at +0.09% on 2-26, -0.96% on 2-25, -0.84% on 2-22, -1.53% on 2-21, -0.53% on 2-20, +0.46% on 2-19, -1.65% on 2-15, -0.03% on 2-14, +0.08% on 2-13, -1.79% on 2-12, -1.18% on 2-11, -1.51% on 2-8, +0.75% on 2-7, -0.21% on 2-6, +1.08% on 2-5, -1.99% on 2-4, -0.97% on 2-1.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
There might be an opportunity to day trade the major averages short early tomorrow, but, I'm more interested in looking to trade the major averages ultra long via QLD, SSO, or UWM once a very short term cycle low occurs (probably early to mid session tomorrow), because, SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) are probably in a short term Wave 3 upcycle now.
SPX (S & P 500) and NDX (NASDAQ 100) probably put in a short term Wave 2 cycle low on 2-7-08, and, probably put in a Wave 2 down cycle low on Friday 2-22 (note the large bullish inverse spike on Friday's candle) of a short term Wave 3 upcycle, see http://stockcharts.com/charts/gallery.html?%24spx for SPX, and, see http://stockcharts.com/charts/gallery.html?%24ndx for NDX.
RUT (Russell 2000) however probably just put in a short term Wave 2 cycle low on Friday 2-22, see http://stockcharts.com/charts/gallery.html?%24rut, note the large bullish inverse spike on Friday's candle.
I'll look to day trade the major averages ultra short early on Friday (using the intraday/very short term Elliott Wave count) via QID, TWM, or SDS.
Wave A intermediate term (Cyclical Bear Market began 10-11-07 for SPX, late October 2007 for NDX, late July 2007 for RUT) cycle lows occurred on 1-23 for SPX/NDX and on 1-22 for RUT (Russell 2000), so, SPX/NDX/RUT are in a countertrend Wave B minor intermediate term upcycle.
The Rollover/Upside Surprise Barometer is at neutral, since Fed credit declined by a modest -$253 Million in the five day period ending 2-27-08, see http://www.federalreserve.gov/releases/h41/Current/ . However, Fed credit was a humongous $41 Billion today 2-28, see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE, so, there might be a good entry point to trade the major averages long tomorrow, as discussed earlier.
HUI (http://stockcharts.com/charts/gallery.html?%24hui) has only risen +1.97% the past six weeks, from 1-14-08's cycle high at 489.49 to today 2-28's cycle high at 499.12, which is obviously not a healthy linear upcycle, but is bearish dramatic rollover action.
A Wave 1 Cyclical Bull Market (began late 2000) cycle high is probably imminent for HUI/XAU. Wave 1 obviously implies that there should a Wave 3 and a Wave 5 Cyclical Bull Market in the future, but, a 12-18 month Wave 2 Cyclical Bear Market should soon begin.
See the extremely bearish five day NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem, and, see the extremely bearish three month NEM Lead Indicator at http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The NEM Lead Indicator is extremely bearish in February, at +0.29% versus the XAU on 2-28, at -0.58%, at +0.09% on 2-26, -0.96% on 2-25, -0.84% on 2-22, -1.53% on 2-21, -0.53% on 2-20, +0.46% on 2-19, -1.65% on 2-15, -0.03% on 2-14, +0.08% on 2-13, -1.79% on 2-12, -1.18% on 2-11, -1.51% on 2-8, +0.75% on 2-7, -0.21% on 2-6, +1.08% on 2-5, -1.99% on 2-4, -0.97% on 2-1.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:26 PM
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