GDX/HUI/XAU/GLD and NEM (Attempted) Upside Gap Filling Action Is Likely Early Tomorrow
GDX/HUI/XAU/GLD and NEM (attempted) upside gap filling action is likely early tomorrow, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c.
Reliable lead indicator NEM has a large bullish inverse spike on today 9-2's candle, see http://stockcharts.com/charts/gallery.html?nem, and, today's sector NEM Lead Indicator was a very bullish +1.83% versus the XAU on 9-2. Today's broad market Walmart (WMT) lead indicator, used in concert with the sector lead indicator, was a very bullish +1.39% versus the S & P 500 (SPX) on 9-2.
Also, GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) did an extremely anemic up down up down pattern today, following the crash at the open, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, and, GDX entered Wave 5 up just before session's end, so, Wave 5 may peak early tomorrow, and, a good shorting opportunity may present itself. After the crash that occurred at the open, today 9-2's action was probably a countertrend Wave B type rebound.
I'm waiting, as I said in today's first post, for GDX to try and very likely fail to fill today 9-2's huge upside (likely bearish breakaway) gap at 37.64, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, and, I'm waiting for DZZ to try and very likely fail to fill today 9-2's huge downside (likely bullish breakaway) gap at 32.91, see http://finance.yahoo.com/q/ta?s=dzz&t=5d&l=on&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c, then, I'll look to reshort GDX and reenter DZZ. I'll watch downside gaps at 34.46 and 32.20 for GDX, and, at 77.63 for GLD for DZZ, after entering those positions. I'll also find out where DZZ's upside gap is.
Both the five day (http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem) and the intraday (http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem) NEM Lead Indicators were and are very bullish, which obviously helped a lot with my decision to exit my shorts early today.
GDX/HUI/XAU/GLD entered Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 7-15-08, see http://stockcharts.com/charts/gallery.html?gdx.
GDX/HUI/XAU/GLD entered Wave C of Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 8-28-08, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c.
HUI/XAU put in an intermediate term and very likely 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 cycles for reliable lead indicator NEM and GDX/HUI/XAU/GLD are vastly different, because, NEM obviously leads. NEM is in a Cyclical Bull Market since the mid 2007 cycle low at 37.84. NEM's bear market from 1-31-06 until mid 2007 correctly portended the current GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08. NEM is/might be in a Wave 3 major intermediate term upcycle since 8-11-08 (40.78 cycle low) versus GDX/HUI/XAU/GLD are in a Wave A major intermediate term downcycle (Wave C crash began 7-15-08) since 3-17-08.
The five day sector NEM Lead Indicator (was a very bullish +1.83% versus the XAU on 9-2, +0.90% versus the XAU on 8-29, +0.19% on 8-28, -0.25% on 8-27, +0.78% on 8-26, -0.07% on 8-25, +1.87% on 8-22, -2.00% on 8-21, -0.87% on 8-20, -0.47% on 8-19) is very bullish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem, which points to a significant bounce after likely GDX/HUI/XAU/NEM downside gap filling action (GDX's at 34.46 and maybe but probably not 32.20 yet, GLD's at 77.63) on Wednesday. Early on on 9-3 a failed attempt at filling 9-2's huge upside gaps is likely, then, the expected downside gap filling action should begin/occur.
The five day broad market Walmart Lead Indicator (was a very bullish +1.39% versus the S & P 500 (SPX) on 9-2, +0.02% versus the S & P 500 on 8-29, -0.48% on 8-28, -0.31% on 8-27, +0.40% on 8-26, +0.46% on 8-25, +0.48% on 8-22, -0.01% on 8-21, -0.34% on 8-20, -0.14% on 8-19), used in concert with the sector NEM Lead Indicator, is very bullish, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.
Wave A down of the HUI/XAU/Gold Wave 2 Cyclical Bear Market since 3-17-08 probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?%24hui. At important cycle lows there's almost always a bullish very large inverse spike, and, on 8-11 the inverse spike is relatively small compared to prior important cycle lows, see the second chart down at the link above. Also, GDX (Gold Miners ETF) has unfilled downside gaps at 32.20, 34.46, 36.18 (filled 9-2), and 37.02 (filled 9-2) that will probably get filled before the bottom occurs.
Reliable lead indicator NEM has a respectably large bullish inverse spike on 8-11's candle, and, might have bottomed on 8-11, see http://stockcharts.com/charts/gallery.html?nem, and, NEM took out the cycle low that occurred in early May (which was a surprise), so, NEM is putting in/put in a Wave 2 major intermediate term cycle low, not a Wave 2 minor intermediate term cycle low.
The Wave 1 major intermediate term upcycle peaked in January at 57.44, and, NEM entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
The NEM Lead Indicator was a very bullish +1.83% versus the XAU today/on 9-2, was a bullish +0.90% versus the XAU on 8-29, was a slightly bullish +0.19% on 8-28, was a modestly bearish -0.25% on 8-27, was a bullish +0.78% on 8-26, was -0.07% on 8-25, was a very bullish +1.87% on 8-22, was an extremely bearish -2.00% on 8-21, was a bearish -0.87% on 8-20, was -0.47% on 8-19, was -0.21% on 8-18, was +0.45% on 8-15, was a very bullish +1.48% on 8-14, was a very bearish -1.62% on 8-13, was a very bearish -1.03% 8-12, was +0.65% on 8-11, +1.90% on 8-8, +1.26% on 8-7, -1.82% on 8-6, -0.15% on 8-5, +2.29% on 8-4, +2.28% on 8-1, +1.08% on 7-31, -0.55% on 7-30, +0.05% on 7-29, -0.42% on 7-28, +0.12% on 7-25, +5.67% on 7-24, +0.83% on 7-23, +2.51% on 7-22, +0.71% on 7-21, +0.62% on 7-18, -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15.
The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength.
The US Dollar entered a Wave 3 Minor Intermediate Term Upcycle on 7-15-08, see http://stockcharts.com/charts/gallery.html?%24usd, and, entered a Cyclical Bull Market within a Secular Bear Market on 3-17-08, after putting in a cycle low at 70.698. Note the very large bullish inverse spike on 3-17-08's and 7-15-08's candle.
The US Dollar hit a 5% major buy signal! (major breakout), see http://tradethecycles.blogspot.com/2008/08/us-dollar-hit-5-follow-through-major.html.
GDX created a downside gap at 36.18 on 8-21, HUI did so at 330.47, the XAU did so at 145.35, GLD did so at 77.63 (not filled yet), and, NEM did so at 43.25, ALL got filled on 9-2 except GLD, gold tends to lag. GDX created a downside gap at 34.46 on 8-18, HUI did so at 315.50. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8 (filled), GDX created one at 38.92, HUI created one at 356.72, and, GLD created one at 86.09. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06 for GLD.
The SPX (S & P 500) short term Wave 4 downcycle since 8-11-08 probably? (questionable now) bottomed on 8-20-08, see http://stockcharts.com/charts/gallery.html?%24spx, and, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c.
SPX's (S & P 500) chart is too sickly to trade long (might be breaking down, might be failing to do an Elliott Wave 12345 up down up down up pattern), see http://stockcharts.com/charts/gallery.html?%24spx, which means that one should look for SPX shorting opportunities. RUT is the best long. My primary (key word) trading focus now, and probably for a while, is the precious metals sector, my favorite trading sector.
SPX created a downside gap at 1281.66 on 8-28, that got filled today as expected. Watch WMT's downside gap at 58.10 (filled 8-26) and SPX's at 1249.01. WMT has an upside gap at 60.76 (filled 9-2) and SPX has one at 1305.31.
The WMT (Walmart) Lead Indicator was a very bullish +1.39% versus the S & P 500 (SPX) on today/9-2, was +0.02% on 8-29, was a modestly bearish -0.48% on 8-28, was a modestly bearish -0.31% on 8-27, was a modestly bullish +0.40% on 8-26, was a modestly bullish +0.46% on 8-25, was a modestly bullish +0.48% on 8-22, -0.01% on 8-21, -0.34% on 8-20, was a slightly bearish -0.14% on 8-19, was a bullish +0.60% versus SPX (S & P 500) on 8-18, and, was a very bullish +1.78% on 8-15, so, it's very bullish short term.
VIX rose an unusually large +6.49% today 9-2 versus SPX falling a modest -0.41%, which is an unusually large +6.08% rise in fear (+6.49% + -0.41% = +6.08% rise in the SPX (S & P 500) wall of worry) that points to some weakness on Wednesday 9-3.
SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) probably finally bottomed on 7-15, see http://stockcharts.com/charts/gallery.html?%24spx, http://stockcharts.com/charts/gallery.html?%24ndx, and http://stockcharts.com/charts/gallery.html?%24rut. 7-15's very bullish candles and the strong short term Wave 1 upcycle suggest that SPX/NDX/RUT probably finally bottomed. RUT's chart is the most bullish, with the largest bullish inverse spike and best chart.
SPX probably put in a Wave A major intermediate term (since 10-11-07) cycle low on 7-15-08, and, NDX/RUT probably put in a Wave 2 minor intermediate term cycle low on 7-15-08, for the countertrend Wave B major intermediate term upcycle since 3-17-08 for NDX and since 3-10-08 for RUT.
The WMT (Walmart) Lead Indicator was a very bullish +1.39% versus the S & P 500 (SPX) on today/9-2, was +0.02% on 8-29, was -0.48% on 8-28, was -0.31% on 8-27, was +0.40% on 8-26, was +0.46% on 8-25, was +0.48% on 8-22, was -0.01% on 8-21, was -0.34% on 8-20, was -0.14% on 8-19, was +0.60% on 8-18, was a very bullish +1.78% on 8-15, was -0.17% on 8-14, was an extremely bearish -2.02% on 8-13, was an extremely bullish +2.39% on 8-12, was +0.52% on 8-11, -0.81% on 8-8, was an extremely bearish -4.46% on 8-7, +0.36% on 8-6, +0.40% on 8-5, was an extremely bullish +2.08% on 8-4, -0.92% on 8-1, was a very bullish +1.41% on 7-31, +0.26% on 7-30, +0.21% on 7-29, +0.43% on 7-28, -0.67% on 7-25, +0.38% on 7-24, was an extremely bearish -2.05% on 7-23, was a very bullish +1.70% on 7-22, was a very bearish -1.00% on 7-21, +0.39% on 7-18, +0.06% on 7-17, -0.32% on 7-16, +0.97% on 7-15.
The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength (began on 7-15-08).
Trade the Cycles won't indicate that a major cycle low very likely occurred until a 5% follow through major buy signal occurs, but, since a strong short term Wave 1 upcycle occurred, then SPX has probably bottomed (on 7-15-08).
At least waiting for a strong multi day short term Wave 1 upcycle (typically about 2 to 3 sessions) before looking to trade long overnight, then, one should wait for a pullback/short term Wave 2 downcycle (typically about 1.5 to 3 sessions) before trading long overnight (look to go long early in a short term Wave 3 upcycle, that typically lasts 3 to 5 sessions).
Since SPX (S & P 500) probably bottomed I'll look to trade rockets. It makes a lot of sense to trade with the wind at your back.
Once SPX puts in a Wave A major intermediate term cycle low (probably did on 7-15-08) watch upside gaps at 1278.60, 1305.31, 1321.97, 1342.83, 1350.93, 1404.05, 1426.63, 1447.16, 1467.95, 1488.41, and, there are probably additional upside gaps I need to identify.
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/very likely began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), and, began in late July 2007 for RUT (Russell 2000).
.......http://www.JoeFRocks.com/
NEM XAU HUI
Reliable lead indicator NEM has a large bullish inverse spike on today 9-2's candle, see http://stockcharts.com/charts/gallery.html?nem, and, today's sector NEM Lead Indicator was a very bullish +1.83% versus the XAU on 9-2. Today's broad market Walmart (WMT) lead indicator, used in concert with the sector lead indicator, was a very bullish +1.39% versus the S & P 500 (SPX) on 9-2.
Also, GDX (Gold Miners ETF, http://stockcharts.com/charts/gallery.html?gdx) did an extremely anemic up down up down pattern today, following the crash at the open, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, and, GDX entered Wave 5 up just before session's end, so, Wave 5 may peak early tomorrow, and, a good shorting opportunity may present itself. After the crash that occurred at the open, today 9-2's action was probably a countertrend Wave B type rebound.
I'm waiting, as I said in today's first post, for GDX to try and very likely fail to fill today 9-2's huge upside (likely bearish breakaway) gap at 37.64, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c, and, I'm waiting for DZZ to try and very likely fail to fill today 9-2's huge downside (likely bullish breakaway) gap at 32.91, see http://finance.yahoo.com/q/ta?s=dzz&t=5d&l=on&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c, then, I'll look to reshort GDX and reenter DZZ. I'll watch downside gaps at 34.46 and 32.20 for GDX, and, at 77.63 for GLD for DZZ, after entering those positions. I'll also find out where DZZ's upside gap is.
Both the five day (http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem) and the intraday (http://finance.yahoo.com/q/ta?s=%5EXAU&t=1d&l=off&z=m&q=l&p=&a=&c=%5Ehui,nem) NEM Lead Indicators were and are very bullish, which obviously helped a lot with my decision to exit my shorts early today.
GDX/HUI/XAU/GLD entered Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 7-15-08, see http://stockcharts.com/charts/gallery.html?gdx.
GDX/HUI/XAU/GLD entered Wave C of Wave C of the Wave A Major Intermediate Term Downcycle (since mid March) on 8-28-08, see http://finance.yahoo.com/q/ta?s=GDX&t=5d&l=on&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c.
HUI/XAU put in an intermediate term and very likely 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 cycles for reliable lead indicator NEM and GDX/HUI/XAU/GLD are vastly different, because, NEM obviously leads. NEM is in a Cyclical Bull Market since the mid 2007 cycle low at 37.84. NEM's bear market from 1-31-06 until mid 2007 correctly portended the current GDX/HUI/XAU/GLD Wave 2 Cyclical Bear Market since 3-17-08. NEM is/might be in a Wave 3 major intermediate term upcycle since 8-11-08 (40.78 cycle low) versus GDX/HUI/XAU/GLD are in a Wave A major intermediate term downcycle (Wave C crash began 7-15-08) since 3-17-08.
The five day sector NEM Lead Indicator (was a very bullish +1.83% versus the XAU on 9-2, +0.90% versus the XAU on 8-29, +0.19% on 8-28, -0.25% on 8-27, +0.78% on 8-26, -0.07% on 8-25, +1.87% on 8-22, -2.00% on 8-21, -0.87% on 8-20, -0.47% on 8-19) is very bullish, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem, which points to a significant bounce after likely GDX/HUI/XAU/NEM downside gap filling action (GDX's at 34.46 and maybe but probably not 32.20 yet, GLD's at 77.63) on Wednesday. Early on on 9-3 a failed attempt at filling 9-2's huge upside gaps is likely, then, the expected downside gap filling action should begin/occur.
The five day broad market Walmart Lead Indicator (was a very bullish +1.39% versus the S & P 500 (SPX) on 9-2, +0.02% versus the S & P 500 on 8-29, -0.48% on 8-28, -0.31% on 8-27, +0.40% on 8-26, +0.46% on 8-25, +0.48% on 8-22, -0.01% on 8-21, -0.34% on 8-20, -0.14% on 8-19), used in concert with the sector NEM Lead Indicator, is very bullish, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.
Wave A down of the HUI/XAU/Gold Wave 2 Cyclical Bear Market since 3-17-08 probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?%24hui. At important cycle lows there's almost always a bullish very large inverse spike, and, on 8-11 the inverse spike is relatively small compared to prior important cycle lows, see the second chart down at the link above. Also, GDX (Gold Miners ETF) has unfilled downside gaps at 32.20, 34.46, 36.18 (filled 9-2), and 37.02 (filled 9-2) that will probably get filled before the bottom occurs.
Reliable lead indicator NEM has a respectably large bullish inverse spike on 8-11's candle, and, might have bottomed on 8-11, see http://stockcharts.com/charts/gallery.html?nem, and, NEM took out the cycle low that occurred in early May (which was a surprise), so, NEM is putting in/put in a Wave 2 major intermediate term cycle low, not a Wave 2 minor intermediate term cycle low.
The Wave 1 major intermediate term upcycle peaked in January at 57.44, and, NEM entered a Cyclical Bull Market in June 2007 after putting in a Cyclical Bear Market (began 1-31-06) cycle low at 37.84.
The NEM Lead Indicator was a very bullish +1.83% versus the XAU today/on 9-2, was a bullish +0.90% versus the XAU on 8-29, was a slightly bullish +0.19% on 8-28, was a modestly bearish -0.25% on 8-27, was a bullish +0.78% on 8-26, was -0.07% on 8-25, was a very bullish +1.87% on 8-22, was an extremely bearish -2.00% on 8-21, was a bearish -0.87% on 8-20, was -0.47% on 8-19, was -0.21% on 8-18, was +0.45% on 8-15, was a very bullish +1.48% on 8-14, was a very bearish -1.62% on 8-13, was a very bearish -1.03% 8-12, was +0.65% on 8-11, +1.90% on 8-8, +1.26% on 8-7, -1.82% on 8-6, -0.15% on 8-5, +2.29% on 8-4, +2.28% on 8-1, +1.08% on 7-31, -0.55% on 7-30, +0.05% on 7-29, -0.42% on 7-28, +0.12% on 7-25, +5.67% on 7-24, +0.83% on 7-23, +2.51% on 7-22, +0.71% on 7-21, +0.62% on 7-18, -1.91% on 7-17, +0.31% on 7-16, +0.52% on 7-15.
The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength.
The US Dollar entered a Wave 3 Minor Intermediate Term Upcycle on 7-15-08, see http://stockcharts.com/charts/gallery.html?%24usd, and, entered a Cyclical Bull Market within a Secular Bear Market on 3-17-08, after putting in a cycle low at 70.698. Note the very large bullish inverse spike on 3-17-08's and 7-15-08's candle.
The US Dollar hit a 5% major buy signal! (major breakout), see http://tradethecycles.blogspot.com/2008/08/us-dollar-hit-5-follow-through-major.html.
GDX created a downside gap at 36.18 on 8-21, HUI did so at 330.47, the XAU did so at 145.35, GLD did so at 77.63 (not filled yet), and, NEM did so at 43.25, ALL got filled on 9-2 except GLD, gold tends to lag. GDX created a downside gap at 34.46 on 8-18, HUI did so at 315.50. Reliable lead indicator NEM created a bearish breakaway gap at 44.71 on 8-8 (filled), GDX created one at 38.92, HUI created one at 356.72, and, GLD created one at 86.09. Upside gaps were created on 7-23 at 47 for GDX, 432.50 for HUI, 185.04 for the XAU, and, at 93.06 for GLD.
The SPX (S & P 500) short term Wave 4 downcycle since 8-11-08 probably? (questionable now) bottomed on 8-20-08, see http://stockcharts.com/charts/gallery.html?%24spx, and, see http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=m26-12-9%2Cp12%2Cfs%2Cw14&c.
SPX's (S & P 500) chart is too sickly to trade long (might be breaking down, might be failing to do an Elliott Wave 12345 up down up down up pattern), see http://stockcharts.com/charts/gallery.html?%24spx, which means that one should look for SPX shorting opportunities. RUT is the best long. My primary (key word) trading focus now, and probably for a while, is the precious metals sector, my favorite trading sector.
SPX created a downside gap at 1281.66 on 8-28, that got filled today as expected. Watch WMT's downside gap at 58.10 (filled 8-26) and SPX's at 1249.01. WMT has an upside gap at 60.76 (filled 9-2) and SPX has one at 1305.31.
The WMT (Walmart) Lead Indicator was a very bullish +1.39% versus the S & P 500 (SPX) on today/9-2, was +0.02% on 8-29, was a modestly bearish -0.48% on 8-28, was a modestly bearish -0.31% on 8-27, was a modestly bullish +0.40% on 8-26, was a modestly bullish +0.46% on 8-25, was a modestly bullish +0.48% on 8-22, -0.01% on 8-21, -0.34% on 8-20, was a slightly bearish -0.14% on 8-19, was a bullish +0.60% versus SPX (S & P 500) on 8-18, and, was a very bullish +1.78% on 8-15, so, it's very bullish short term.
VIX rose an unusually large +6.49% today 9-2 versus SPX falling a modest -0.41%, which is an unusually large +6.08% rise in fear (+6.49% + -0.41% = +6.08% rise in the SPX (S & P 500) wall of worry) that points to some weakness on Wednesday 9-3.
SPX (S & P 500)/NDX (NASDAQ 100)/RUT (Russell 2000) probably finally bottomed on 7-15, see http://stockcharts.com/charts/gallery.html?%24spx, http://stockcharts.com/charts/gallery.html?%24ndx, and http://stockcharts.com/charts/gallery.html?%24rut. 7-15's very bullish candles and the strong short term Wave 1 upcycle suggest that SPX/NDX/RUT probably finally bottomed. RUT's chart is the most bullish, with the largest bullish inverse spike and best chart.
SPX probably put in a Wave A major intermediate term (since 10-11-07) cycle low on 7-15-08, and, NDX/RUT probably put in a Wave 2 minor intermediate term cycle low on 7-15-08, for the countertrend Wave B major intermediate term upcycle since 3-17-08 for NDX and since 3-10-08 for RUT.
The WMT (Walmart) Lead Indicator was a very bullish +1.39% versus the S & P 500 (SPX) on today/9-2, was +0.02% on 8-29, was -0.48% on 8-28, was -0.31% on 8-27, was +0.40% on 8-26, was +0.46% on 8-25, was +0.48% on 8-22, was -0.01% on 8-21, was -0.34% on 8-20, was -0.14% on 8-19, was +0.60% on 8-18, was a very bullish +1.78% on 8-15, was -0.17% on 8-14, was an extremely bearish -2.02% on 8-13, was an extremely bullish +2.39% on 8-12, was +0.52% on 8-11, -0.81% on 8-8, was an extremely bearish -4.46% on 8-7, +0.36% on 8-6, +0.40% on 8-5, was an extremely bullish +2.08% on 8-4, -0.92% on 8-1, was a very bullish +1.41% on 7-31, +0.26% on 7-30, +0.21% on 7-29, +0.43% on 7-28, -0.67% on 7-25, +0.38% on 7-24, was an extremely bearish -2.05% on 7-23, was a very bullish +1.70% on 7-22, was a very bearish -1.00% on 7-21, +0.39% on 7-18, +0.06% on 7-17, -0.32% on 7-16, +0.97% on 7-15.
The more important/longer the cycle is that's bottoming or peaking the longer the lag time tends to be before the indication kicks in, in this case strength (began on 7-15-08).
Trade the Cycles won't indicate that a major cycle low very likely occurred until a 5% follow through major buy signal occurs, but, since a strong short term Wave 1 upcycle occurred, then SPX has probably bottomed (on 7-15-08).
At least waiting for a strong multi day short term Wave 1 upcycle (typically about 2 to 3 sessions) before looking to trade long overnight, then, one should wait for a pullback/short term Wave 2 downcycle (typically about 1.5 to 3 sessions) before trading long overnight (look to go long early in a short term Wave 3 upcycle, that typically lasts 3 to 5 sessions).
Since SPX (S & P 500) probably bottomed I'll look to trade rockets. It makes a lot of sense to trade with the wind at your back.
Once SPX puts in a Wave A major intermediate term cycle low (probably did on 7-15-08) watch upside gaps at 1278.60, 1305.31, 1321.97, 1342.83, 1350.93, 1404.05, 1426.63, 1447.16, 1467.95, 1488.41, and, there are probably additional upside gaps I need to identify.
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/very likely began on 10-11-07 for SPX (S & P 500), began in late October 2007 for NDX (NASDAQ 100), and, began in late July 2007 for RUT (Russell 2000).
.......http://www.JoeFRocks.com/
NEM XAU HUI
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
1:28 PM
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