Idan at 3:57pm
Goog seems to be forming a H&S formation on the 10 minute line, take a good look, a break of 499 could mean the end of the rallys for GOOG and potentially some of the other tech.
Woo:
1:06 pm
Timing is everything. So THIS point is where I would say to look for a possible stronger drop.
If things work out right we should see a strong move to minimum 1135, but there’s a good chance we could retrace first like you mentioned fritz. The ideal places would be 1106 or 1099.
The 1088 area doesn’t need to play anymore because it has already proved enough of its significance. If we broke below 1099, I would say we COULD hit the light green trend line a little below 1095, but I still think the 1099 area should hold, if we ever get there.
* Fritz’s comment: Need to let the negative divergence play out. Long hedges got auto-sold at 1117 (auto-execs are good when they work right). I would still warn against shorting if any one was considering it. I don’t think the upside is done yet for the next two weeks.
Idan:
12:15am
Here’s a 60 minute $SPY chart, that explains a little more of what i was talking about yesterday. Please look at the strong resistance levels i had (112.50 and 115).
Here is some info on the Dow Jones and a EW count chart on what may be happening.
DJIA target is 10,508 in a wave 2 of a 50% retrace before we enter more major downward action- (see chart):
http://newsusa.myfeedportal.com/i/elliott-wave-djia-stock-market-update-june-16-2010-djia
Stockstarter, this is a great analysis. However, I am not familiar to John Drilling. How reputable is he?
His stuff is up their from time to time it appears. Looks like a EW enthusiast going by the charts, but perhaps more for a swing-trader as updates are generally in frequent.
Looks like we’ll get the gap down I expected yesterday.
NYMO was at 79 yesterday, pretty overbought (in fact, higher than it was during March 2010 when the relentless rally was confirmed). That may have been the peak for NYMO (at the end of A), with further advances in C producing negative divergence on the NYMO. Picking the right stock to short today (high beta ones only) can make you 20% in one day, but as I said, don’t be greedy. 1080 is not unexpected, although less likely. Why? Because wave 2s of any degree should produce more extremes than the initial top/bottom. VIX at the all time S&P high was 16.08; and at Intermediate 2 of Primary 1 (according to EWavers), VIX was at 15.82; just prior to the April 2010 top, VIX was at 15.23. Draw your own conclusions, but I won’t be surprised to see VIX 14.88 before one nasty push down, and I won’t be surprised to see VIX 13.97 in February 2011. We’re not in the low 20s for the VIX, so I don’t believe the upswing is over.
fritz what does your wave structure look like with the vix being at 14 by february 2011, do you expect a crash right this year at all
I don’t care about EWaves, as you might know. I am not an EWaver, nor do I intend to be one. (My method works better than EWaves, so there is no need for me to switch over.) What I use is what I call “1-2-3″ formation, with smaller “1-2-3″ embedded in larger “1-2-3″, and variations of it. I am using EWavers’ language so that people understand what I am talking about. The “2″ is the counter-trend move, and its job is to make traders think that the prior trend is back in full swing (similar to Daneric’s assertion that wave 2′s job is to not look like wave 2s but to look like a bull wave). As noted by its nature, it often results in sentiment extremes (fear/greed – aka VIX) that exceed the highs/lows at the end of the prior trend. As evident in Primary 1, sentiment extreme was at the end of Intermediate 2 on May 19 2008. I don’t think we’ll go back to sub-16 VIX in Minor 2 of Intermediate 1 of Primary 3, but I am open to it. I think we’ll only get sub-15 VIX at the END of Intermediate 2 of Primary 3, which according to my 1-2-3 projections is still a long ways away.
1180 is the max I would allow for the intermediate term bearish case. Beyond that we’ll be looking at 1220 and beyond to produce negative divergence on the MONTHLY charts, which will be long term bearish regardless of how you look at it. This is like what Woo said, it doesn’t matter whether P3 started on April 26 2010 or it starts in late 2010 or early 2011, it is bound to start and there’s no stopping it.
If the market really plays out like how my model projected it back on March 8 2010, then the US market has already put in its high of the year and the S&P will be headed for 920 and below before the Fall. This scenario is the highest probability one but its probability will be reduced in half if S&P 1170 is breached for two days.
Thanks for your thoughts Fritz. Do you see a touch of 1119-1122 today? If it happens do you see enough resistance at that level to go short? I see a lot of the stocks with their stochastics well over 85-90 and at resistance points where a drop seems imminent.
Negative divergence is now present in the MACD, so that indicates top at this area. RSI divergence usually comes before MACD divergence. The conservative way to trade is to get out at the RSI divergence, and then for a bit more aggressive go counter-trend at the MACD divergence + two bars on the time frame you use for your trade. The divergence must be near or at S/R to be effective.
What do you mean by S/R?
Support/Resistance
Thank you.
I mentioned yesterday i do think we will back test to the 110.50 – 109.50 level before a move to 113.00.I do think that has a chance to play out..
Let’s not forget Opex on Friday !!! Voo-doo i say will happen
I`m going away for 2 days starting tomorrow so I`m reluctant to take on any positions today. I`m just holding nat gas and gold right now.
Crude oil inventories up by 1.7 mil vs est. of -1.83.
Big pullback on UNG does anyone think a pullback to $8.00 is possible ??? I would love to pick it up there !!!
Yes Dave like I said yesterday. UNG is a buy in the 8-8.15 range. Let me reiterate it’s a longer term hold. Projection of the price is in the mid teens. That might happen and IMHO if you can get it for around 8.00 that seems like a safer bet than on most.
With FNM and FRE being taken off the NYSE and going to pinks I am wondering if that might be a play with a dead cat. Mighty tempting IMHO. Any thoughts?
We definitely need to see volumes increase… in the meantime, I’ll continue to hold names like NFLX and SAM.
looks like the pullback was to just a little below the 200ma. I win! =)
Woo,
Do you have upside target?
I would say 1119 is the short term target. However, this whole 1119-1124 area is around the long term P1 retrace, if we get over that lump we could get a very strong rise, possibly to the 1150s that people have been talking about, if not higher. There’s a major trend line around 1145 right now, but it will rise to meet 1149 in about a week or so.
The thing I’m watching now is the 1 year RSI, which is hitting on a trend line. If we can break north of this, we could see a good amount of rising. We could bounce off of it though. The short term RSI allows for more rising to come and isn’t a factor at the moment.
Don’t even consider an index short unless the market is back below the 200ma which is currently 1109.
Thnx!!
Need to let the negative divergence play out. Long hedges got auto-sold at 1117 (auto-execs are good when they work right). I would still warn against shorting if any one was considering it. I don’t think the upside is done yet for the next two weeks.
Timing is everything. So THIS point is where I would say to look for a possible stronger drop.
Not sure if this linkable chart will work. Let me know if it doesn’t and I’ll upload it up top:
http://stockcharts.com/h-sc/ui?s=$SPX&p=5&yr=0&mn=1&dy=10&id=p00298733142&a=181738042
If things work out right we should see a strong move to minimum 1135, but there’s a good chance we could retrace first like you mentioned fritz. The ideal places would be 1106 or 1099.
The 1088 area doesn’t need to play anymore because it has already proved enough of its significance. If we broke below 1099, I would say we COULD hit the light green trend line a little below 1095, but I still think the 1099 area should hold, if we ever get there.
alright posted a chart up top just in case.
On Monday I told Idan that I believed 1088 would hold for the week, and I still believe so. The only thing is I don’t know how options expiration will affect things (whether the market will move below 1096).
Those were nice chunk of unexpected cash towards my purchase of a farm land. I had calls on names I knew would break out: TCK.B. (TSX) 5X the entry, ECA (TSX) 3.2X the entry, MRK a whopping 12X the entry, AXP 6X the entry, JPM 3X the entry (I think it got auto-exec’ed too early), BA 5X the entry. All those were auto-filled at 1044 area when I was alerted of the positive divergence on the daily chart and I wasn’t ignoring it like Daneric.
I think we’re generally in agreement right now, or have been for a few weeks. It’s just semantics as to the higher probability of specific support and resistance points that will hit in the process of getting to the end goal. I think we’re also generally similar in how conservative we are at specific points based on longer term and shorter term considerations.
A lot of the EW guys focus too much on EW alone. Like I’ve mentioned before, I like the math and theory behind short term EW like a hobby. However, I don’t think it’s as effective as longer term EW. The short term has to account for far too many corrections and possibilities, and is almost useless to me in terms of trading. Some of the other EW guys might be able to make money off of it, but it’s never been practical in my view.
Great job on those call positions. Well played =)
Woo, I think that’s the exact problem with a lot of the EWavers in that they rely on it alone too much. I don’t ignore those indicators, and the one time I did would have made it impossible for me to buy a farm land (that was back in February 2010) had I not be so paranoid and held all hedging calls.
Darn, that sucker AXP is a master of short squeeze though, haha. I thought I got out on 1/3 of the calls too early at $40, and I thought I got out another 1/3 too early yesterday, and darn it I am left with only my long term AXP hedging calls today after I got out the remaining June calls. I thought it would try for $46 but without a pullback before opex? Wow.
Todays action is like watching world cup….alot of nothing happening !!!!
Market catching its breath after yesterday`s run.
anyone have thoughts on gold and the gold miners?
i’m up almost 3% on my YRI.TO (NYSE:AUY) purchased two days ago.
seems like gold wants to go higher.
i’m thinking of selling as this gets back towards the $11 level.
GLD is looking solid. above 120 it’s a solid bull. We could get a rise and break out on gold. I’ve got a $125 minimum projection on GLD. GDX has been playing out really nicely too, and my subscribers are following it. I’m bullish gold based on the current charts.
$125, wow.
it is a very bullish looking chart.
this is the main reason why i’m not going long most things and the reason i will short if we get up to the 1150 area.
i think it’s signaling something, and that something isn’t going to be good.
nice push higher on the spy. i’m going to go back and look at woo’s chart…lots of lines there to think about.
haha. went RIGHT near my 1119. missed it by .26 . Good enough right? =P
nice one!
Awesome
Zee here,
Guys short HON.TO and HUN.TO .. both complicated derivates that need to be shorted.
unfortunately IB has no shares., been trying to get them for 3 months.
otherwise short FAS/FAZ in pairs.. short HOU.TO/HOD.TO in pairs..
that’s my game plan..easy money.. and alleviates so much stress from the daily markets.
This doesn’t make any sense.
Can you post an example of this in action? Say one week, one month?
If it worked everyone would be doing this.
Also, I’ve read before that people were trying to do this and it wasn’t worth it.
So can you post something to show this is working for you?
Thanks.
Who else is getting slaughtered from blindly following the subscription service? =(
Following whose trades?
I am happy with my guy Woo so far. When he is not sick.
I think the paid services are going to get better with time. And as a subscriber I must get better utilizing the info provided. I am sure Woo will work with me on this.
Just my 2 cents worth
I’ll be patient, sorry just a little frustrated.
Does anyone use any other subscription services? I’m looking at trying alphatrends, but watching his calls a little longer before deciding to pay for it.
kenji, are you talking about my service? Which positions did you get into? I haven’t made very recommendations, and I always recommend having stops in place. I’ve barely traded the last 2 weeks, but have been doing well on the trades I have entered. Let me know. Thanks!
I must not be subscribed to the right one?
I’m on the one that got stopped out on CIM yesterday.
Each email for that subscription is signed by Idan, Tze, Woo
the alerts and analytics subscription is based on the trades that are used in idan and tony’s hedge fund. i don’t currently work do anything for that subscription, but may do so in the future offering support charts for their recommendations. my name is also there because i stand behind the service. the hedge fund has been performing very well, and the current market isn’t exactly the best time to be making money for the most part. i think long term the alerts and analytics subscribers have been doing very well and i would give it a little more time and patience. if you’re looking for other services to also try out, give the leveraged etf pro subscription a try. i work solely on that at the moment and give charts and analysis on a number of etfs and individual stocks. you won’t get live alerts and updates, but i think that it does a good job of equipping you to look for the spots that can give you higher probability trades. either way, thanks for giving our services a shot!
Thanks woo
What service are you using kenjisan ????
FocalEquity Alerts and Analytics
I agree with Waveup in regard to Woo’s analysis. The information Woo provides is another tool I use to evaluate when to put my money on the line. I have found Woo’s analysis to be smart, honest and conservative.
I’m not really sure about other subscription services Keep us posted on your findings.
i agree
I doubt GOOG is breaking lower any time soon. It made a higher high on the RSI with a lower high today. It’s been holding the trendline that’s in place since late 2008. Even the flash crash didn’t do any damage to the line. In fact, GOOG tapped that trendline perfectly during the flash crash, and tapped it a few more times since. It hasn’t shown any evidence that it’ll break down soon.
I hope no one shorted into the close. I’ve been saying that as long as there is no negative divergence on the daily charts, you’re asking for trouble if you short the market. Negative divergences take longer to play out than positive divergences (that’s right, it’s a tough game to be a grizzly). One other thing to take note: when the resit of the world finishes their counter-trend correction, they’ll enter their Minor 3 and during their Minute 2 retrace, the US market will make a new high, and then the US will enter Minute 3 of Minor 3 directly (call it the PPT effect). That’s why it’s hard to see a clear 5 waves down on the US indices and that’s why I don’t apply EWave to US indices, unless it’s for very long term projections.
*I meant rest of the world
goog has been wedging since the beginning of may. it will probably need to pick a direction before the month is over. we may have finished a long term 3 wave down. goog still has a lot of potential upside. i’m going to wait a bit on this and get more confirmation before trading it.
If it’s a valid 2 daily bar break of down trendline resistance, 700 is not out of the question.
Yeah, that’s what i’m looking for initially. I have a possible 676 projection if it can get some footing. if it gets back under 480, it could get ugly.
To the person asking how shorting leveraged instruments creates money, it’s called decay, and secondly why is everyone not doing it is because there’s a risk of 1 investment to go up more than 100% while the other one is down -99.9%…
Can I give an example?
FAS is down -20% over a 2 year basis, FAZ is down -99% over 2 years.
Now tell me, how is a 99% ROI and 80% ROI in 2 years time not good?
lol
trust me a lot of people are doing this.
good luck finding shares.
so finding shares is the problem?
i mean it has to be something otherwise i’ll just short FAZ and FAS tomorrow, sit back and collect the $$$.
i understand decay but something about this seems off.
reminds me of the 30x leveraged guys in 08 somehow.
in any event, thanks for the info. appreciated.
For those playing the index etfs (SPY, Qs, DIA) for OpEx. Take note that the past 2 OpEx, intraday news popped up (GS in April, GOOG in May) which rattled not only those stocks but the indexes as well. Sounds like a conspiracy (who knows) but could just be a coincidence (if there is such a thing in the markets). Maybe a big Dow component this time around? I’d keep this in mind for this Friday.
GL!
I TOLD YOU that I am always right. I am sam if you remember me I had been posting here for a several months and I gave a GREAT AND HUGE money maker calls. Just a few of them were FSLR , UAUA, ERX, M and tons of money maker calls. Well I don’t know why my name was seleted from here (may be beacuse i was saying I TOLD YOU). Anyway I don’t care beacuse I made a HUGE PROFIT lately based on my always correct forecast, I just made 6000% profit just in May and June. Anyway good luck.
Dude, seriously…
that’s 60x your money in 2 months. so if you start with 10k, you would turn it into 600k. if i did that in two months, i would not be posting i told you so on this website, i would be in vegas or an island country somewhere celebrating. haha. but to each his own =) glory on focalequity.com is as good as any real life celebration.
Amen Woo the I TOLD YOU SO Clown is back. Let me guess I TOLD YOU CLOWN you shorted BP from 60 to 29 right? Oh wait you shorted FNM and FRE! WTG you da man……………..NOT. Go cut the grass before your Dad get home thanks.
great, this dork is back…there goes the neighbourhood.
yooo
Surprised to hear the bullishness on GOLD. I was looking at the weekly charts today and GLD in a clear ascending wedge and the DZZ in a clear descending wedge (both with declining volume) make me think Gold hit its double top and will not break back above the $122.75 range… in fact i think Gold is due for a much bigger correction of 15-20% in the next few weeks, and will probably coincide with a drop in the overall market.
also:
–>the SPY looks to be on a CLEAR path to $115 where it will form the right shoulder of a major H&S. This “Lehman Level” needs to be broken with conviction before anyone should consider being a Bull in this new market. This bounce off of $104.36 had to happen considering what a strong resistance/support that level was.
–>the VXX seems poised to test the $25.50 area which is where the 50 and 100 MA’s intersect on daily…bound to be strong support and can coincide with a turning point in the markets where they turn lower again. the VXX hasn’t retested the 50MA since breaking through and making a strong run in early May.
–>the SDS appears to be completing a clear IHS on both the Daily and Weekly and will find support at the 50MA on the daily at $31.97 which coincides with the shoulder line to form the Right shoulder.
If all the starts align on all the above setups, the market could be moving lower and quickly…all of these plays could work out nicely.
any thoughts/comments?