SPX's (S & P 500) Short Term Wave C Downcycle Since 11-5-08 Probably Bottomed, And, The Cyclical Bear Market Might Have Ended
SPX's (S & P 500) short term Wave C downcycle since 11-5-08 probably bottomed today 11-13-08, and, the Cyclical Bear Market since 10-11-07 might have bottomed today at the 818.69 cycle low (a good but obviously questionable probability, but, a 5% major buy signal must occur anyway, before Trade the Cycles indicates that a major cycle low has very likely occurred), see the 5 day intraday candlestick chart at http://finance.yahoo.com/q/ta?s=%5Espx&t=5d&l=off&z=l&q=c&p=&a=p12%2Cfs%2Cw14&c=, and, see the daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24spx. Note that SPX's daily candlestick chart has a very large very bullish inverse spike on a bullish white (close above the open) candle today 11-13-08.
Looking at SPX's 5 day intraday candlestick chart, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=, a very strong intraday/very short term Wave 1 upcycle was peaking late today, and, an intraday/very short term Wave 2 downcycle should occur early tomorrow, after which some good long trading opportunities should arise for most indexes/sectors of the market. Nothing I discuss on this Blog is a recommendation.
The broad market Walmart (WMT) Lead Indicator was an extremely bearish -2.53% versus the S & P 500 (SPX) today/on 11-13 (+1.20% on 11-12, +1.42% on 11-11, +2.72% on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5), which is a very short term bullish indication.
The five day intraday Walmart (WMT) Lead Indicator closed at very bullish (from +1% to +2%), see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=p12,fs,w14&c=wmt,%5EGSPC, which points to SPX/market strength very early on tomorrow.
The nature of cycles strongly suggests that SPX (S & P 500), and, any other indexes/sectors that put in an important cycle low today, will put in a Wave 2 type cycle low in the next day or two, such that the upcycle's trendline begins relatively flat.
HUI's recent very bullish triple bottom is a great example of a very important upcycle (likely Wave 3 Cyclical Bull Market) beginning very flat, see http://stockcharts.com/charts/gallery.html?%24hui, and, reliable gold sector lead indicator NEM's short term Wave 2 cycle low today at 22.58, see http://stockcharts.com/charts/gallery.html?nem, versus a recent Wave 3 Cyclical Bull Market cycle low at 21.40, is another good example of a very important upcycle (Wave 3 Cyclical Bull Market) beginning relatively flat.
Other important developments today are the fact that the gold/silver stock sector (gold and silver probably didn't bottom yet) has very likely recently entered a Wave 3 Cyclical Bull Market.
HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) entered a Secular Bull Market in November 2000/October 2000, versus gold doing so in April 2001 and silver doing so in late 2001, so, gold and silver will probably lag HUI/XAU again, and, will probably bottom in 3 to 6 months, silver maybe longer, assuming that HUI/XAU recently bottomed and entered a Wave 3 Cyclical Bull Market.
GDX/HUI/XAU put in a short term Wave 2 cycle low today (GDX filled 18.69 as expected), see http://stockcharts.com/charts/gallery.html?%24hui, and, note that HUI's daily candlestick chart has a very large very bullish inverse spike on a bullish white (close above the open) candle today 11-13-08.
I'm on the verge (the system waits for a 5% major buy signal, I DO NOT officially call bottoms or tops, I wait for major buy/sell signals, only proven systems can consistently time the market) of becoming very bullish on this sector, but, I might wait for a 5% major buy signal.
Another important development today is that DUG (UltraShort Oil & Gas ETF) probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?dug, and, note that DUG has a very large very bearish spike on a bearish black (close below the open) candle today 11-13-08. Today's cycle high is probably/very likely a countertrend Wave B of Wave C cycle high.
The XOI (AMEX Oil & Gas) is doing a very anemic likely countertrend Wave B minor intermediate term upcycle since 10-10-08, and, put in a Wave 4 down cycle low of a very long short term (like an anemic monthly upcycle) Wave 3 upcycle today 11-13-08, see http://stockcharts.com/charts/gallery.html?%24xoi.
So, DUG (UltraShort Oil & Gas ETF) should bottom when the XOI's very anemic countertrend Wave B minor intermediate term upcycle since 10-10-08 peaks. The XOI (AMEX Oil & Gas) is probably still in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?%24xoi.
Early tomorrow I'll look to day trade the XOI (AMEX Oil and Gas) ultra long via DIG, and/or, I'll look to trade GDX/AEM/CDE long. Today I day traded DUG twice (each less than two minutes, the large 10 minute chart that fills my screen helps a lot with finetuning entry/exit points) and netted 43 cents/$430 for each 1000 shares traded.
DUG had an upside gap at 41.50 (filled 11-12). The XOI (AMEX Oil and Gas) had a downside gap at 900.39 (filled 11-11), and, has an upside gap at 952.76. XOM (Exxon Mobil) has downside gaps at 69.96 (filled 11-12) and 66.09, and, has an upside gap at 77.49.
The gold stock sector (GDX/HUI/XAU) is one sector that clearly APPEARS to have bottomed, see http://stockcharts.com/charts/gallery.html?%24hui. HUI has a nice very bullish triple bottom. Reliable lead indicator NEM recently put in a nice bullish double bottom at 21.40/21.47, see http://stockcharts.com/charts/gallery.html?nem. Waiting for a 5% major buy signal makes a lot of sense obviously.
The lead indicators jive with strength (began 11-13-08), for most sectors/indexes.
The 5 day intraday broad market Walmart (WMT) Lead Indicator is/closed at very bullish (-2.53% versus SPX today/on 11-13, +1.20% on 11-12, +1.42% on 11-11, +2.72% on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5, -3.79% on 11-4, +0.54% on 11-3, +0.40% on 10-31, -3.07% on 10-30, +0.84% on 10-29, +0.28% on 10-28, -0.19% on 10-27), 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.
The 5 day intraday gold sector NEM Lead Indicator is/closed at neutral (-5.07% versus the XAU today/on 11-13, +2.74% on 11-12, +1.72% on 11-11, +0.97% on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The 5 day intraday oil and gas sector XOM (Exxon Mobil) Lead Indicator is/closed at extremely bullish (which is very short term bearish, -1.91% versus the XOI today/on 11-13, +2.39% on 11-12, +2.23% on 11-11, -0.53% on 11-10, +0.65% on 11-7, +0.44% on 11-6, -0.23% on 11-5, -2.49% on 11-4, +2.41% on 11-3, -3.01% on 10-31, -3.26% on 10-30, -3.62% on 10-29, -0.45% on 10-28, +1.46% on 10-27), see http://finance.yahoo.com/q/ta?t=5d&s=%5EXOI&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=xom.
The GDX/HUI/XAU Wave 2 Cyclical Bear Market since mid March is probably/appears to be over (don't be shocked if it isn't), see http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI/XAU still need to hit a 5% major buy signal however, before Trade the Cycles indicates that they've very likely bottomed. This still could end up being the mother of all headfakes. Also, gold very likely hasn't bottomed.
Gold (http://stockcharts.com/charts/gallery.html?gld) lags GDX/HUI/XAU, and, will probably bottom at $500ish, maybe $450 or even lower.
Reliable gold sector lead indicator Newmont Mining (NEM) shot up a spectacular +22.89% on 10-28-08, see http://stockcharts.com/charts/gallery.html?nem.
It LOOKS LIKE (it obviously makes a LOT of sense to wait for a 5% follow through major buy signal) NEM PROBABLY put in a Wave 2 Cyclical Bear Market (since 1-31-06) cycle low just before 10-27's close at 21.40, which is a bullish double bottom cycle low with the previous session's cycle low at 21.47.
The GDX/HUI/XAU Wave 3 Cyclical Bull Market (might not have started yet) is likely to be a great one. Wave 3 upcycles tend to be large, relative to Wave 1 upcycles.
SPX (S & P 500) and the XOI (AMEX Oil & Gas) are probably still in a Cyclical Bear Market (SPX's might have ended today 11-13-08), see SPX at http://stockcharts.com/charts/gallery.html?%24spx, and, see the XOI at http://stockcharts.com/charts/gallery.html?%24xoi. Since cycle lows keep failing, one has to assume that's the case. SPX put in lower cycle lows in five consecutive sessions recently.
The NASDAQ 100 (NDX) is probably still in a Cyclical Bear Market (NDX's might have ended today 11-13-08), see http://stockcharts.com/charts/gallery.html?%24ndx, as are RUT (Russell 2000, might have ended today 11-13-08), see http://stockcharts.com/charts/gallery.html?%24rut.
A Cyclical Bear Market 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).
Please keep in mind that, after an index puts in a potential major cycle low, it has to hit a 5% follow through (after breaking the major downcycle trendline) major buy signal before the Trade the Cycles system indicates that a major cycle low has very likely occurred.
My original Trade the Cycles system uses the reliable Elliott Wave patterns (see the Trade the Cycles charts at http://www.joefrocks.com/GoldStockCharts.html) and maps them to cycles of various timeframes (an Elliott Wave is either an upcycle or a downcycle), from very short term (hours/days), short term (days/weeks), monthly (4-7 weeks), minor intermediate term (2-3 months), major intermediate term (3-12 months), long term (1 to 2 years), Cyclical Bull/Bear Market (6 months to 7 years, yes, a bull/bear can be relatively brief), Secular Bull/Bear Market (8-20+ years).
Gaps are very important also, since most gaps get filled and they often provide insight into when cycle highs/lows will occur.
.......http://www.JoeFRocks.com/
NEM XAU HUI
Looking at SPX's 5 day intraday candlestick chart, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=, a very strong intraday/very short term Wave 1 upcycle was peaking late today, and, an intraday/very short term Wave 2 downcycle should occur early tomorrow, after which some good long trading opportunities should arise for most indexes/sectors of the market. Nothing I discuss on this Blog is a recommendation.
The broad market Walmart (WMT) Lead Indicator was an extremely bearish -2.53% versus the S & P 500 (SPX) today/on 11-13 (+1.20% on 11-12, +1.42% on 11-11, +2.72% on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5), which is a very short term bullish indication.
The five day intraday Walmart (WMT) Lead Indicator closed at very bullish (from +1% to +2%), see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=l&p=&a=p12,fs,w14&c=wmt,%5EGSPC, which points to SPX/market strength very early on tomorrow.
The nature of cycles strongly suggests that SPX (S & P 500), and, any other indexes/sectors that put in an important cycle low today, will put in a Wave 2 type cycle low in the next day or two, such that the upcycle's trendline begins relatively flat.
HUI's recent very bullish triple bottom is a great example of a very important upcycle (likely Wave 3 Cyclical Bull Market) beginning very flat, see http://stockcharts.com/charts/gallery.html?%24hui, and, reliable gold sector lead indicator NEM's short term Wave 2 cycle low today at 22.58, see http://stockcharts.com/charts/gallery.html?nem, versus a recent Wave 3 Cyclical Bull Market cycle low at 21.40, is another good example of a very important upcycle (Wave 3 Cyclical Bull Market) beginning relatively flat.
Other important developments today are the fact that the gold/silver stock sector (gold and silver probably didn't bottom yet) has very likely recently entered a Wave 3 Cyclical Bull Market.
HUI/XAU (http://stockcharts.com/charts/gallery.html?%24hui) entered a Secular Bull Market in November 2000/October 2000, versus gold doing so in April 2001 and silver doing so in late 2001, so, gold and silver will probably lag HUI/XAU again, and, will probably bottom in 3 to 6 months, silver maybe longer, assuming that HUI/XAU recently bottomed and entered a Wave 3 Cyclical Bull Market.
GDX/HUI/XAU put in a short term Wave 2 cycle low today (GDX filled 18.69 as expected), see http://stockcharts.com/charts/gallery.html?%24hui, and, note that HUI's daily candlestick chart has a very large very bullish inverse spike on a bullish white (close above the open) candle today 11-13-08.
I'm on the verge (the system waits for a 5% major buy signal, I DO NOT officially call bottoms or tops, I wait for major buy/sell signals, only proven systems can consistently time the market) of becoming very bullish on this sector, but, I might wait for a 5% major buy signal.
Another important development today is that DUG (UltraShort Oil & Gas ETF) probably didn't bottom yet, see http://stockcharts.com/charts/gallery.html?dug, and, note that DUG has a very large very bearish spike on a bearish black (close below the open) candle today 11-13-08. Today's cycle high is probably/very likely a countertrend Wave B of Wave C cycle high.
The XOI (AMEX Oil & Gas) is doing a very anemic likely countertrend Wave B minor intermediate term upcycle since 10-10-08, and, put in a Wave 4 down cycle low of a very long short term (like an anemic monthly upcycle) Wave 3 upcycle today 11-13-08, see http://stockcharts.com/charts/gallery.html?%24xoi.
So, DUG (UltraShort Oil & Gas ETF) should bottom when the XOI's very anemic countertrend Wave B minor intermediate term upcycle since 10-10-08 peaks. The XOI (AMEX Oil & Gas) is probably still in a Cyclical Bear Market, see http://stockcharts.com/charts/gallery.html?%24xoi.
Early tomorrow I'll look to day trade the XOI (AMEX Oil and Gas) ultra long via DIG, and/or, I'll look to trade GDX/AEM/CDE long. Today I day traded DUG twice (each less than two minutes, the large 10 minute chart that fills my screen helps a lot with finetuning entry/exit points) and netted 43 cents/$430 for each 1000 shares traded.
DUG had an upside gap at 41.50 (filled 11-12). The XOI (AMEX Oil and Gas) had a downside gap at 900.39 (filled 11-11), and, has an upside gap at 952.76. XOM (Exxon Mobil) has downside gaps at 69.96 (filled 11-12) and 66.09, and, has an upside gap at 77.49.
The gold stock sector (GDX/HUI/XAU) is one sector that clearly APPEARS to have bottomed, see http://stockcharts.com/charts/gallery.html?%24hui. HUI has a nice very bullish triple bottom. Reliable lead indicator NEM recently put in a nice bullish double bottom at 21.40/21.47, see http://stockcharts.com/charts/gallery.html?nem. Waiting for a 5% major buy signal makes a lot of sense obviously.
The lead indicators jive with strength (began 11-13-08), for most sectors/indexes.
The 5 day intraday broad market Walmart (WMT) Lead Indicator is/closed at very bullish (-2.53% versus SPX today/on 11-13, +1.20% on 11-12, +1.42% on 11-11, +2.72% on 11-10, -1.21% on 11-7, +3.85% on 11-6, +1.71% on 11-5, -3.79% on 11-4, +0.54% on 11-3, +0.40% on 10-31, -3.07% on 10-30, +0.84% on 10-29, +0.28% on 10-28, -0.19% on 10-27), 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.
The 5 day intraday gold sector NEM Lead Indicator is/closed at neutral (-5.07% versus the XAU today/on 11-13, +2.74% on 11-12, +1.72% on 11-11, +0.97% on 11-10, -1.54% on 11-7, +0.13% on 11-6, -0.62% on 11-5, -4.40% on 11-4, -0.25% on 11-3, -1.11% on 10-31, +2.34% on 10-30, -12.86% on 10-29, +9.90% on 10-28, -0.40% on 10-27), see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem.
The 5 day intraday oil and gas sector XOM (Exxon Mobil) Lead Indicator is/closed at extremely bullish (which is very short term bearish, -1.91% versus the XOI today/on 11-13, +2.39% on 11-12, +2.23% on 11-11, -0.53% on 11-10, +0.65% on 11-7, +0.44% on 11-6, -0.23% on 11-5, -2.49% on 11-4, +2.41% on 11-3, -3.01% on 10-31, -3.26% on 10-30, -3.62% on 10-29, -0.45% on 10-28, +1.46% on 10-27), see http://finance.yahoo.com/q/ta?t=5d&s=%5EXOI&l=off&z=l&q=c&a=m26-12-9&a=p12&a=fs&a=w14&c=xom.
The GDX/HUI/XAU Wave 2 Cyclical Bear Market since mid March is probably/appears to be over (don't be shocked if it isn't), see http://stockcharts.com/charts/gallery.html?%24xau. GDX/HUI/XAU still need to hit a 5% major buy signal however, before Trade the Cycles indicates that they've very likely bottomed. This still could end up being the mother of all headfakes. Also, gold very likely hasn't bottomed.
Gold (http://stockcharts.com/charts/gallery.html?gld) lags GDX/HUI/XAU, and, will probably bottom at $500ish, maybe $450 or even lower.
Reliable gold sector lead indicator Newmont Mining (NEM) shot up a spectacular +22.89% on 10-28-08, see http://stockcharts.com/charts/gallery.html?nem.
It LOOKS LIKE (it obviously makes a LOT of sense to wait for a 5% follow through major buy signal) NEM PROBABLY put in a Wave 2 Cyclical Bear Market (since 1-31-06) cycle low just before 10-27's close at 21.40, which is a bullish double bottom cycle low with the previous session's cycle low at 21.47.
The GDX/HUI/XAU Wave 3 Cyclical Bull Market (might not have started yet) is likely to be a great one. Wave 3 upcycles tend to be large, relative to Wave 1 upcycles.
SPX (S & P 500) and the XOI (AMEX Oil & Gas) are probably still in a Cyclical Bear Market (SPX's might have ended today 11-13-08), see SPX at http://stockcharts.com/charts/gallery.html?%24spx, and, see the XOI at http://stockcharts.com/charts/gallery.html?%24xoi. Since cycle lows keep failing, one has to assume that's the case. SPX put in lower cycle lows in five consecutive sessions recently.
The NASDAQ 100 (NDX) is probably still in a Cyclical Bear Market (NDX's might have ended today 11-13-08), see http://stockcharts.com/charts/gallery.html?%24ndx, as are RUT (Russell 2000, might have ended today 11-13-08), see http://stockcharts.com/charts/gallery.html?%24rut.
A Cyclical Bear Market 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).
Please keep in mind that, after an index puts in a potential major cycle low, it has to hit a 5% follow through (after breaking the major downcycle trendline) major buy signal before the Trade the Cycles system indicates that a major cycle low has very likely occurred.
My original Trade the Cycles system uses the reliable Elliott Wave patterns (see the Trade the Cycles charts at http://www.joefrocks.com/GoldStockCharts.html) and maps them to cycles of various timeframes (an Elliott Wave is either an upcycle or a downcycle), from very short term (hours/days), short term (days/weeks), monthly (4-7 weeks), minor intermediate term (2-3 months), major intermediate term (3-12 months), long term (1 to 2 years), Cyclical Bull/Bear Market (6 months to 7 years, yes, a bull/bear can be relatively brief), Secular Bull/Bear Market (8-20+ years).
Gaps are very important also, since most gaps get filled and they often provide insight into when cycle highs/lows will occur.
.......http://www.JoeFRocks.com/
NEM XAU HUI
Labels: DUG, GDX, Gold, Gold Stocks, HUI, NEM, RUT, Silver, Silver Stocks, SPX, XAU, XOI, XOM
posted by Joe Ferrazzano at
11:32 AM
2 Comments:
A gold stock (they have an iron mine also and may also mine other metals) that's been acting very well lately (has more than doubled from it's likely Cyclical Bear Market cycle low at 2.38) is Eldorado Gold Corp. (EGO), up +0.72 (+17.69%) to close at 4.79 today 11-13-08, on 2,639,903 shares versus Avg Vol (3m): 2,490,130. Not a recommendation, do your own due diligence.
By
Joe Ferrazzano, at 7:59 PM
The Democrats in congress want to give GM (and Ford/Chrysler?) $25 Billion. Unless the major root problems affecting GM/Ford/Chrysler are addressed, giving them $25 Billion is kind of like giving an alcoholic another drink or two. It helps them for a short while, that's all.
The Democrats are great at spending a lot of money on things. They're not so great at truly fixing things and running effective programs.
I have great hope that President Elect Obama can truly bring great change and make the government much more effective and efficient.
By
Joe Ferrazzano, at 8:28 PM
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