SPX (S & P 500) Appears To Have Entered Wave 5 Of A Big Short Term Wave 1 Upcycle
SPX (S & P 500) appears to have entered Wave 5 of a big short term Wave 1 upcycle early today, because, SPX has done an up down up down pattern on the daily chart since the likely Wave A intermediate term cycle low occurred on 3-17-08, see http://stockcharts.com/charts/gallery.html?%24spx. The Elliott Wave count jives with today 3-26's bullish WMT Lead Indicator, at +0.60% versus SPX, 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.
On SPX's 5 day intraday candlestick chart one can see that SPX did an Elliott Wave ABC down up down pattern from mid session on Monday 3-24 until early today 3-26, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, that probably was Wave 4 down of a big short term Wave 1 upcycle since 3-17.
SPX (S & P 500) has an upside gap at 1367.68 that might get filled in the current very short term Wave 5 upcycle, and, has a downside gap at 1329.51. SPX (S & P 500) has a bullish breakaway gap at 1276.60 from 3-18's open and WMT has one at 49.95 from 3-18's open.
SPX (S & P 500) and NDX (NASDAQ 100) probably put in Wave A intermediate term cycle (since 10-11-07 for SPX and late October 2007 for NDX) lows on 3-17, while RUT (Russell 2000) probably did so on 3-10, see http://stockcharts.com/charts/gallery.html?%24spx for SPX.
VIX rose a significant +1.40% today/on 3-26 versus the S & P 500 falling a significant -0.88% on 3-26, which is a significant +0.52% rise in fear (the SPX wall of worry grew by +0.52% = +1.40% + -0.88% = +0.52% rise in fear) that points to some significant strength on Thursday 3-27.
I'll be looking to day trade SPX ultra long early on Thursday via SSO, and, I'll be looking to short GDX, the Gold Miners ETF. I'll also be looking at trading some major averages options (probably SPX calls) on Thursday. Today I bought some SPX April 1450 calls (SXZDJ) at 1.10.
The Upside Surprise/Rollover Barometer is at "Likely" due to the aggressive Fed credit extended since 2-28-08, that fuels index related program buying ("only" 70% of the dollar volume on the NYSE), see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE.
A Cyclical Bear Market probably began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), began in late July 2007 for RUT (Russell 2000).
HUI/XAU/gold are doing a short term countertrend Wave B upcycle, following last week's huge short term Wave A downcycle (HUI fell -18.29% in a little under three sessions, and, bottomed on 3-20) that triggered a very important 5% follow through major sell signal, see http://stockcharts.com/charts/gallery.html?%24xau. HUI/XAU/gold are in Wave 3 of the short term countertrend Wave B upcycle, since there's an up down up pattern on the daily chart since 3-20, when Wave B started.
The five day NEM Lead Indicator has turned extremely bearish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.
The NEM Lead Indicator was a very bearish -1.44% versus the XAU today/on 3-26, was an extremely bearish -1.85% versus the XAU on 3-25, was an extremely bearish -2.19% versus the XAU on 3-20, and, was a bearish -0.63% on 3-24, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
From HUI's 5 day intraday candlestick chart it looks like Wave 4 down of the short term countertrend Wave B upcycle (began 3-20) might start tomorrow, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c, so, there might be a good shorting opportunity tomorrow. I'll be looking to short GDX, the Gold Miners ETF.
Concerning HUI/XAU/gold, the important thing now is that HUI/XAU/gold hit a 5% follow through major sell signal, see http://stockcharts.com/charts/gallery.html?%24xau. The multi month uptrend lines broke down and 5%+ follow through occurred to the downside. HUI/XAU/gold (gold might lag and peak in rollover mode) are in the midst of a major intermediate term downcycle, that's probably the start of an 18 monthish Wave 2 Cyclical Bear Market. HUI/XAU/gold will probably fall -50%+ in this bear market. Got cycles?
Gold and silver had two Cyclical Bear Markets in the previous Secular Bull Market that peaked in 1980, corresponding to Elliott Wave 2 and 4 downcycles, see http://tradethecycles.blogspot.com/2008/03/gold-and-silvers-two-cyclical-bear.html.
HUI/XAU very likely put in an intermediate term and a Wave 1 Cyclical Bull Market cycle high on 3-17 for HUI and on 3-14 for the XAU, see http://stockcharts.com/charts/gallery.html?%5Ehui. The XAU has a large bearish spike on 3-14's candle.
The -18.29% HUI short term Wave A downcycle in a little under three sessions time last week, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, is very likely an (probably extremely) important turning point/very strong sell signal. The more severe the weakness the stronger the sell signal tends to be, and, the weakness was about as severe as it gets.
The severe weakness/action recently tells us something, just as the severe weakness/5% sell signal that occurred in May 2006 was a good one, since HUI/XAU/gold (http://stockcharts.com/charts/gallery.html?%24xau) were underwater versus the May 2006 cycle high for about 17 months.
A rollover long term upcycle was in effect from June 2006 (from October 2006 for the XAU, http://stockcharts.com/charts/gallery.html?%24xau) until the recent cycle highs, that was probably the Wave 1 Cyclical Bull Market (began in late 2000 for HUI/XAU and in April 2001 for gold, which was a slightly higher bullish double bottom with the 1999 cycle low) peaking in dramatic rollover mode versus the May 2006 cycle high. One can only discuss likely scenarios, not certainties.
Gold and gold mining scams are commonplace, see http://tradethecycles.blogspot.com/2008/03/gold-and-gold-mining-scams-are.html.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
On SPX's 5 day intraday candlestick chart one can see that SPX did an Elliott Wave ABC down up down pattern from mid session on Monday 3-24 until early today 3-26, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, that probably was Wave 4 down of a big short term Wave 1 upcycle since 3-17.
SPX (S & P 500) has an upside gap at 1367.68 that might get filled in the current very short term Wave 5 upcycle, and, has a downside gap at 1329.51. SPX (S & P 500) has a bullish breakaway gap at 1276.60 from 3-18's open and WMT has one at 49.95 from 3-18's open.
SPX (S & P 500) and NDX (NASDAQ 100) probably put in Wave A intermediate term cycle (since 10-11-07 for SPX and late October 2007 for NDX) lows on 3-17, while RUT (Russell 2000) probably did so on 3-10, see http://stockcharts.com/charts/gallery.html?%24spx for SPX.
VIX rose a significant +1.40% today/on 3-26 versus the S & P 500 falling a significant -0.88% on 3-26, which is a significant +0.52% rise in fear (the SPX wall of worry grew by +0.52% = +1.40% + -0.88% = +0.52% rise in fear) that points to some significant strength on Thursday 3-27.
I'll be looking to day trade SPX ultra long early on Thursday via SSO, and, I'll be looking to short GDX, the Gold Miners ETF. I'll also be looking at trading some major averages options (probably SPX calls) on Thursday. Today I bought some SPX April 1450 calls (SXZDJ) at 1.10.
The Upside Surprise/Rollover Barometer is at "Likely" due to the aggressive Fed credit extended since 2-28-08, that fuels index related program buying ("only" 70% of the dollar volume on the NYSE), see http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE.
A Cyclical Bear Market probably began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), began in late July 2007 for RUT (Russell 2000).
HUI/XAU/gold are doing a short term countertrend Wave B upcycle, following last week's huge short term Wave A downcycle (HUI fell -18.29% in a little under three sessions, and, bottomed on 3-20) that triggered a very important 5% follow through major sell signal, see http://stockcharts.com/charts/gallery.html?%24xau. HUI/XAU/gold are in Wave 3 of the short term countertrend Wave B upcycle, since there's an up down up pattern on the daily chart since 3-20, when Wave B started.
The five day NEM Lead Indicator has turned extremely bearish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=l&q=l&p=&a=&c=%5Ehui,nem.
The NEM Lead Indicator was a very bearish -1.44% versus the XAU today/on 3-26, was an extremely bearish -1.85% versus the XAU on 3-25, was an extremely bearish -2.19% versus the XAU on 3-20, and, was a bearish -0.63% on 3-24, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
From HUI's 5 day intraday candlestick chart it looks like Wave 4 down of the short term countertrend Wave B upcycle (began 3-20) might start tomorrow, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c, so, there might be a good shorting opportunity tomorrow. I'll be looking to short GDX, the Gold Miners ETF.
Concerning HUI/XAU/gold, the important thing now is that HUI/XAU/gold hit a 5% follow through major sell signal, see http://stockcharts.com/charts/gallery.html?%24xau. The multi month uptrend lines broke down and 5%+ follow through occurred to the downside. HUI/XAU/gold (gold might lag and peak in rollover mode) are in the midst of a major intermediate term downcycle, that's probably the start of an 18 monthish Wave 2 Cyclical Bear Market. HUI/XAU/gold will probably fall -50%+ in this bear market. Got cycles?
Gold and silver had two Cyclical Bear Markets in the previous Secular Bull Market that peaked in 1980, corresponding to Elliott Wave 2 and 4 downcycles, see http://tradethecycles.blogspot.com/2008/03/gold-and-silvers-two-cyclical-bear.html.
HUI/XAU very likely put in an intermediate term and a Wave 1 Cyclical Bull Market cycle high on 3-17 for HUI and on 3-14 for the XAU, see http://stockcharts.com/charts/gallery.html?%5Ehui. The XAU has a large bearish spike on 3-14's candle.
The -18.29% HUI short term Wave A downcycle in a little under three sessions time last week, see http://finance.yahoo.com/q/ta?s=%5Ehui&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c, is very likely an (probably extremely) important turning point/very strong sell signal. The more severe the weakness the stronger the sell signal tends to be, and, the weakness was about as severe as it gets.
The severe weakness/action recently tells us something, just as the severe weakness/5% sell signal that occurred in May 2006 was a good one, since HUI/XAU/gold (http://stockcharts.com/charts/gallery.html?%24xau) were underwater versus the May 2006 cycle high for about 17 months.
A rollover long term upcycle was in effect from June 2006 (from October 2006 for the XAU, http://stockcharts.com/charts/gallery.html?%24xau) until the recent cycle highs, that was probably the Wave 1 Cyclical Bull Market (began in late 2000 for HUI/XAU and in April 2001 for gold, which was a slightly higher bullish double bottom with the 1999 cycle low) peaking in dramatic rollover mode versus the May 2006 cycle high. One can only discuss likely scenarios, not certainties.
Gold and gold mining scams are commonplace, see http://tradethecycles.blogspot.com/2008/03/gold-and-gold-mining-scams-are.html.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
2:01 PM
1 Comments:
SPX's Wave 4 of the big short term Wave 1 upcycle since 3-17 probably bottomed today as opposed to yesterday.
Yesterday's rising bottoms uptrend was very flat/anemic, so, today's early downside isn't too surprising.
Also, Cisco (CSCO) appears to be a good lead indicator for NDX. I've been asked about an NDX lead indicator a few times.
The reason why WMT, NEM, CSCO probably lead their indexes (SPX, XAU, NDX) is program trading, the large caps are probably the first to move when index related program trading occurs.
By
Joe Ferrazzano, at 10:39 AM
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