Today Was Obviously Huge For The Major Averages
Today was obviously huge for the major averages, 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=. Additional liquidity actions announced by the Fed and other central banks combined with an extremely oversold condition, program buying, short covering, and, a very sharp rise in fear revealed by VIX yesterday, led to a very sharp +3.71% rise in the S & P 500 (SPX) today.
SPX put in a likely slightly higher bullish double bottom Wave A intermediate term cycle low yesterday 3-10 with the 1-23-08 cycle low, see http://stockcharts.com/charts/gallery.html?%24spx. SPX has a likely bullish breakaway gap from today's open at 1273.37 and WMT has one at 48.85 from today's open. SPX might try to fill it's upside gap at 1333.70 in the next day or two.
Based on SPX's (S & P 500) close right at the high of the day (1320.65), the unusually large rise in complacency revealed by VIX today (see two paragraphs below), and, reliable lead indicator Walmart's (WMT) intraday chart (put in a large bullish inverse spike before session's end, and, completed an Elliott Wave ABC down up down pattern near session's end, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=), significant strength is likely early tomorrow for the major averages.
Based on today 3-11's bearish WMT Lead Indicator, at -0.84% versus the S & P 500, 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, and, the fact that a huge spike move is occurring, a significant/sharp pullback is likely tomorrow after likely early strength. I'll probably be looking to day trade the major averages ultra short tomorrow via SDS, QID, or TWM.
VIX fell a substantial -10.28% today/3-11 versus the S & P 500 rising a very sharp +3.71% today/3-11, which is an unusually large +6.57% rise in complacency (the SPX wall of worry fell by -6.57% = -10.28% + +3.71% = +6.57% rise in complacency) that points to some significant strength (probably early tomorrow) followed by significant weakness.
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).
Concerning HUI/XAU/gold I have little to add to yesterday's post (http://tradethecycles.blogspot.com/2008/03/major-averages-might-have-bottomed_10.html). Today's NEM Lead Indicator was a bullish +0.49% versus the XAU. Check out the links at the post above that show gold and silver's two Cyclical Bear Markets in the prior Secular Bull Market.
A Cyclical Bear Market looms in the near future for HUI/XAU/gold/silver and might have already begun for HUI/XAU, take it from a REAL gold bug. There's no place for all the goofy bullish agendas that permeate the gold sector. Agendas are obviously suicide for REAL investors and traders. The gold nitwits are very brave with YOUR money, but, are trembling terrified little school kids with their money.
It's possible that HUI/XAU entered a Wave 2 Cyclical Bear Market on 3-4-08 as I said many times before. Gold tends to lag HUI/XAU at important cycle highs/lows and might not peak for a few weeks or even months after HUI/XAU peak.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
SPX put in a likely slightly higher bullish double bottom Wave A intermediate term cycle low yesterday 3-10 with the 1-23-08 cycle low, see http://stockcharts.com/charts/gallery.html?%24spx. SPX has a likely bullish breakaway gap from today's open at 1273.37 and WMT has one at 48.85 from today's open. SPX might try to fill it's upside gap at 1333.70 in the next day or two.
Based on SPX's (S & P 500) close right at the high of the day (1320.65), the unusually large rise in complacency revealed by VIX today (see two paragraphs below), and, reliable lead indicator Walmart's (WMT) intraday chart (put in a large bullish inverse spike before session's end, and, completed an Elliott Wave ABC down up down pattern near session's end, see http://finance.yahoo.com/q/ta?s=wmt&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c=), significant strength is likely early tomorrow for the major averages.
Based on today 3-11's bearish WMT Lead Indicator, at -0.84% versus the S & P 500, 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, and, the fact that a huge spike move is occurring, a significant/sharp pullback is likely tomorrow after likely early strength. I'll probably be looking to day trade the major averages ultra short tomorrow via SDS, QID, or TWM.
VIX fell a substantial -10.28% today/3-11 versus the S & P 500 rising a very sharp +3.71% today/3-11, which is an unusually large +6.57% rise in complacency (the SPX wall of worry fell by -6.57% = -10.28% + +3.71% = +6.57% rise in complacency) that points to some significant strength (probably early tomorrow) followed by significant weakness.
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).
Concerning HUI/XAU/gold I have little to add to yesterday's post (http://tradethecycles.blogspot.com/2008/03/major-averages-might-have-bottomed_10.html). Today's NEM Lead Indicator was a bullish +0.49% versus the XAU. Check out the links at the post above that show gold and silver's two Cyclical Bear Markets in the prior Secular Bull Market.
A Cyclical Bear Market looms in the near future for HUI/XAU/gold/silver and might have already begun for HUI/XAU, take it from a REAL gold bug. There's no place for all the goofy bullish agendas that permeate the gold sector. Agendas are obviously suicide for REAL investors and traders. The gold nitwits are very brave with YOUR money, but, are trembling terrified little school kids with their money.
It's possible that HUI/XAU entered a Wave 2 Cyclical Bear Market on 3-4-08 as I said many times before. Gold tends to lag HUI/XAU at important cycle highs/lows and might not peak for a few weeks or even months after HUI/XAU peak.
....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:42 PM
5 Comments:
"VIX fell a substantial -10.28% today/3-11 versus the S & P 500 rising a very sharp +3.71% today/3-11, which is an unusually large +6.57% rise in complacency (the SPX wall of worry fell by -6.57% = -10.28% + +3.71% = +6.57% rise in complacency) that points to some significant strength (probably early tomorrow) followed by significant weakness."
I am guessing you majored in finance? LOL, if you are going to talk about the vix having a third graders understanding of it would help. The math you propose is amazingly naive.
By
Anonymous, at 7:54 PM
My degree is in Electrical Engineering, BSEE cum laude. I've been doing VIX versus SPX and XAU Implied Volatility versus the XAU to gauge the SPX and the XAU wall of worry for years, and, I know that it works a high % of the time. I'm not proposing anything I know that it's useful. Good luck.
By
Joe Ferrazzano, at 11:25 PM
Here's another example:
The XAU rose +5.06% on 3-11/Tuesday versus XAU Implied Volatility falling -8.83% to 41.740on 3-11 from 45.785 on 3-10, which is a very sharp +3.77% rise in complacency that points to potentially severe XAU weakness on 3-12, because, the XAU wall of worry fell -3.77% = +5.06% + -8.83%.
By
Joe Ferrazzano, at 11:44 PM
HUI/XAU and especially reliable lead indicator NEM fell sharply already on Wednesday 3-12 from their session cycle high.
The severe weakness portended by the -3.77% decline in the XAU wall of worry on 3-11 was an accurate indication.
When you leave a comment next time don't insult me (I know how smart I am and how good my work is kid) and explain WHY what I said was questionable. Substance is required. For all I know you could be one of the vile ignorant gold nitwits.
By
Joe Ferrazzano, at 7:57 AM
Also, the major averages were strong early then fell significantly as expected, which is what typically happens when an unusually large rise in complacency occurs in the prior session.
By
Joe Ferrazzano, at 11:32 AM
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