SPX (S & P 500)/The Market/Most Sectors/Indexes Might Have Bottomed!

SPX (S & P 500, http://stockcharts.com/charts/gallery.html?%24spx)/the market/most sectors/indexes might have bottomed!, and, entered a Cyclical Bull Market, however, the Cyclical Bull Market for the major averages is likely to be a brief six to nine monthish one. How's that for great news on a Friday?

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.

Fundamentally, it makes sense that the market MIGHT HAVE bottomed, because, the major and minor world powers, and, their central banks, are taking aggressive steps to inflate the world out of the deflationary mess/credit crisis, and, to provide confidence in the financial system/markets. The US's $700 Billion bailout, plus other major steps taken (money market fund bailout, etc), China's $586 Billion stimulus package, plus rate cuts in many countries, are a few examples.

It'll take time to inflate the world out of this deflationary mess/credit crisis. Yes, gold might hit $2000+ in about 10 years, but, it might hit $350-$400 next year, when it finally bottoms. Remember that HUI/XAU bottomed in late 2000, whereas, gold bottomed in April 2001 and silver didn't bottom until late 2001. The metals LAG.

See SPX's daily candlestick chart at http://stockcharts.com/charts/gallery.html?%24spx, and, note the large bullish inverse spike on today 12-5-08's bullish white (close above the open) candle, and, note the bullish triple bottom the past week.

SPX (S & P 500) appears to have put in a short term Wave 2 cycle low on Monday 12-1-08, see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=. Also, note that SPX put in a huge very bullish inverse spike late in the session today 12-5-08, so, a large bullish breakaway type gap up at Monday 12-8-08's open, and/or early strength, won't be surprising.

The reliable three month broad market Walmart (WMT) Lead Indicator (+1.98% versus the S & P 500 (SPX) today/on 12-5, +4.27% on 12-4, -0.84% on 12-3, -3.16% on 12-2, +3.79% on 12-1, -1.87% on 11-21, +6.04% on 11-20, +2.89% on 11-19, +0.78% on 11-18, +0.87% on 11-17, +0.13% on 11-14, -2.53% 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) jives with SPX (S & P 500)/the market having possibly bottomed, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=3m&l=off&z=l&q=l&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC.

After today 12-5-08's big spike move Walmart's (WMT) intermediate term upcycle since early/mid October 2008 looks reasonably healthy, see http://stockcharts.com/charts/gallery.html?wmt, and, note that WMT put in a very large very bullish inverse spike at early/mid October's cycle low at 47.

I'll be looking to trade either the major averages ultra long via SSO/QLD/UWM, the Oil/Gas sector ultra long via DIG, or, the gold/silver stock sector long via GDX/AEM/EGO/SLW/SSRI on Monday. Today I day traded SPX ultra short via SDS early on, and, made over 73 cents per share/$730+ per each 1000 shares traded.

Nothing discussed on this Blog is a recommendation or should be construed as investment advice.

If a large bullish breakaway type gap occurs at Monday 12-8-08's open (I'll check many sectors/indexes) I'll look to trade long very early on. If one doesn't occur I'll probably have to wait for an intraday/very short term Elliott Wave ABC down up down downcycle (tends to be an inverse Elliott Wave 12345 pattern = down up down up down), see SPX's (S & P 500) five day intraday candlestick chart at http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=.

The five day intraday broad market WMT Lead Indicator closed at extremely bullish today 12-5-08, see http://finance.yahoo.com/q/ta?s=%5EHUI&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=wmt,%5EGSPC, which (typically) points to early weakness on Monday. The major averages and many indexes/sectors might make large bullish breakaway type gaps up at Monday 12-8-08's open however, so, keep that in mind.

Watch 12-1-08's upside gap at 896.24 for SPX (S & P 500), see http://finance.yahoo.com/q/ta?s=%5EGSPC&t=5d&l=off&z=l&q=c&p=&a=p12,fs,w14&c=, and, watch the upside gap for whatever index/sector/commodity you're trading on Monday 12-8-08, because, those upside gaps might get filled on Monday.

The gold/silver stock apocalypse since May 2006 (reliable gold sector lead indicator NEM since 1-31-06 and GDX/HUI/XAU since mid March 2008) might finally be over for most gold/silver stocks, see the XAU's daily candlestick chart at
http://stockcharts.com/charts/gallery.html?%24xau, and, see reliable gold sector lead indicator NEM's daily candlestick chart at http://stockcharts.com/charts/gallery.html?nem. Note the large bullish inverse spike on today 12-5-08's bullish white (close above the open) candle, for the XAU, NEM, and, also GDX/HUI.

Today 12-5-08's cycle low is a short term Wave 4 cycle low for GDX/HUI/XAU, see http://stockcharts.com/charts/gallery.html?%24xau, with the short term cycles obviously being huge long ones.

The fact that reliable gold sector lead indicator Newmont Mining (NEM, http://stockcharts.com/charts/gallery.html?nem) took out it's late October 2008 cycle low (21.40) on Thursday 11-20-08 (21.17), means that GDX/HUI/XAU have a "good chance" of doing the same, though it LOOKS LIKE (MAYBE) they've bottomed.

The five day intraday NEM Lead Indicator closed at bullish/very bullish today 12-5-08, see http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=l&p=&a=&c=%5Ehui,nem. So, I'll look to (as one of many possible trades) trade GDX/AEM/EGO/SSRI/SLW early on Monday.

The XOI (AMEX Oil and Gas) might have bottomed in early/mid October 2008, see http://stockcharts.com/charts/gallery.html?%24xoi, and, note the very large very bullish inverse spike at the 744.56 cycle low in early/mid October 2008, that might be a Cyclical Bear Market cycle low.

The XOM (Exxon Mobil) Lead Indicator is super bullish recently, at -1.47% versus the XOI today/on 12-5, +2.19% on 12-4, +2.33% on 12-3, +0.34% on 12-2, +3.51% on 12-1, +1.76% on 11-21, +4.48% on 11-20, +2.60% on 11-19, +0.50% on 11-18, +2.61% on 11-17, +0.65% on 11-14, -1.91% 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.

The five day intraday XOM Lead Indicator closed at extremely bullish today 12-5-08, 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, which (typically) points to early weakness on Monday.

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