All Equities update and recommended lightening play in equities 8-31-2011

On the Elliot Wave Count. It suggest that this reaction only serves 2 possible things:

a. Minor wave c of Intermediate Wave 4 downtrend – meaning Wave 5 downtrend coming

b. Minor wave c of Intermediate Wave 1 uptrend of Bear Market Rally (b) – meaning Wave 2 and 3 will come up to around 11500-12000.

On our post last week, if you have followed my tip, you already are +5% to date from the bottom, and on the possible things above, choice A have a 25% chance to happen, Choice B is at 75% likely to happen.

DOW is now at 11550 resistance (1^st resistance), and may take a pause for few days before it runs of the 11550 resistance towards the 11850 resistance in weeks time. On that case, I suggest those who want to cash out, to take that opportunity to get out of the market.

In terms of S&P, the resistance is different from DOW, but is at 1227, few double digit points from now, then eventually the stronger resistance at 1249. I have drawn below the possible trend of S&P, they are both downtrends, but might just be one of them. (BLUE AND GREEN). Same as DOW, I expect things to be lot clearer in the next days/weeks, and same with DOW, those who want to get out of market and stay cash, you can do a play-safe strategy when it hits 1249.

11850 and 1249 for S&P are just pivot resistance points, and for me, a 25% chance that it won’t pass thru that levels, due to weaknesses in economic indicators and Euro Crisis.

OTHER IMPORTANT EQUITIES:

BEAR Market Play of the Quarter 8-22-2011

Hi,

Assuming we are in a BEAR Market, and looks like one (time will tell).

I placed here 2 plays I am going to excecute and hopefully to able do it and make money in this Possible BEAR Market.

On Elliot Wave counts, it suggests that we are in the 5th wave down, and time will tell if we might be getting the A-Choice, or the B-Choice.

Counts suggest that Q2 GDP may be good to be true in order to pull the markets up for weeks/months time. And I have put below BUY margins into the market, I know this is a gut move, but if you want to make 5-12% gain in weeks/maximum 4 months. Better be brave and endure the news.

The Count suggest to buy at 10500-10750 level, and sell at 11500-11800 Levels. That's around 5-12% return.

This is a Bear Market Rally scenario: Chance to Happen 75%, Chance to dip more and below 10k instantly, 25%. Now, you DECIDE if you wanna play.

I AM NOT CLOSING THE BULLISH DOORS and still hoping that PRimary Wave 5 Elliot Wave to new highs will happen. This is just a Bear market scenario money making play.

Are we still in BULL Market or now in a BEAR Market 8-18-2011

Markets are being rattled again by European Bank trying to get a 500M euro loan for a whooping 1.1% a day, and a normal interest rate in europe for 1 month loan is 0.7-1% per month. Something is really on that had rattled this European Market again.

DOW is again 200+ points into the downside.

I have prepared below 2 types of scenario going to happen soon, only time will tell if we are in a BEAR or a BULL.

FIRST. Is the Bearish Scenario where It is now 70% chance of happening, what we had was a cut-throat rally to 11500 resistance level in PINK line, and is likely to make a new low, if that happens, we count the downward selloffs as 5 downward counts, in an ELLIOT WAVE analysis, whatever is a 5 wave downward selloff, is a high chance bear market selloff, followed by a 3 wave rally correction. In short, a 5-3-5 bear market count.

If this happens, I am also scared, that I need to cut all my positions when it reaches 11500-11800-12000 around 1-2months from now, then go away and have a vacation. As this count suggest a strong chance to get 9000 level anytime soon.



SECOND. Market may just be consolidating off the ground, and gaining momentum to break the 11500 resistance, and eventually head onto a small bump to the 11800-12000 resistance, and eventually get out of 12000 level and Bull market continues.

But what's happening right now, is that, more bad news are coming, and I put this scenario as 30% to happen.


SOME PSE MARKET SNAPSHOTS:










Personal Disclosure:
I sold whatever I can sell on the PSE market, now at 75% Cash

Asia Market - still trapped at only 20% cash. Did not even rally on the past 2 months like what PSE did when it hit 4500 level.

Might be a warning for PSE 8-15-2011

PSE market is still resilient, no major damage to our equity. Just a slight correction from the 45xx Top. Could this be a trap for bull people and be trapped on the highs.

In my own opinion, PSE might be forming exactly what happened to DOW. The inverse head and shoulder pattern that has a downward target of 10400-10800.

Now that PSE is still hanging on, I made above a short graph how the inverse head and shoulder may happen also to PSE. Head is the 45xx point, and now we are possible on the right shoulder, with resistance ranging from 4350-4390. If it doesnt go above that level, it might be the right neck. And next would happen would be a possible breakdown and formation of the Inverse Head and Shoulder with a target of 3700-3800. A rally back to the 45xx level will invalidate the inverse H and S scenario.

Be cautious now that Foreign Equities are prone to selloffs. Think wisely why we are just floating around. Are the big traders caught up also and dont want to sell at a loss, or its just a consolidation that many buyers are still pushing up the prices.

REPOST: Tony Caldaro's View on the entire market 8-15-2011

LONG TERM: bear market highly probable

We had been expecting a rising stock market since a few days after the March 2009 low at SPX 667. We even posted a tentative roadmap, based on the existing waves at the time, for the bull market. Early this year the market started to deviate from that projection. Then we started to notice some cracks in the ongoing bull market scenario in June. Starting with this: http://caldaro.wordpress.com/2011/07/12/anticipate-monitor-and-adjust/, we reported the negative technical evidence as it arrived. In just a matter of a couple of weeks we shifted from concern, to a market inflection point with defensive positions warranted, to market breaking down and then bear market highly probable. Everyone should have had sufficient time to adjust accordingly, and hopefully avoid the August debacle.

At first we thought this would be a moderate technical bear market without a recession. Now, with consumer sentiment plunging, we’re not so sure. Normal support for a bear market, following a bull market with this wave structure, would suggest support at SPX 1011, Primary wave II. Since we are only three months into this bear market, and we already hit SPX 1102, this level is not likely going to hold. The next major support level is SPX 869, Major wave 2 of Primary I. This appears to be the markets price objective at this time. This suggests after the recent 19.6% decline (SPX 1371-1102) the bear market will probably end with a 36.6% decline, or 26.3% below current levels. We continue to suggest a time factor of either Q3/Q4 2012, or Q3/Q4 2014 if a double bottom.

From time to time over the past few years we have often written about the characteristics of bull and bear markets displayed on the weekly chart. Typically the RSI, above, gets extremely overbought during bull markets and barely oversold. Also, the MACD, below, spends nearly all of its time above neutral during bull markets. Then during bear markets these two indicators reverse. The RSI gets extemely oversold and barely overbought, while the MACD spends most of its time below neutral. Notice the recent transition after the May 2011 bull market high.

MEDIUM TERM: downtrend low SPX 1102

This downtrend started in early July at SPX 1356. Thus far it appears to have declined in four waves: Int. wave i SPX 1296, Int. wave ii SPX 1347, Int. wave iii SPX 1102, and Int. wave iv tentatively SPX 1189. This count suggests Int. wave v has yet to unfold. We did some Fibonacci calculations for the waves of this downtrend, and came up the following numbers. Some interesting wave relationships are potentially developing: Int. i = 60 points, Int ii = 51 points, Int iii = 245 points, and Int iv = 87 points at 1189, or 1.618 Int. ii. Targets: @ SPX 1089 Int. v = 1.618 Int. i, @ SPX 1092 Int. iii = 2.618 Int v, @ SPX 1093 Int. iii thru v = 4.234 Int. i. There is also an OEW pivot at 1090. This certainly looks like a cluster should the OEW 1187 pivot hold as the Int. iv high. A downtrend low at the OEW 1090 pivot would also align with a similar historical structure, under similar fundamentals, displayed in this recent report: http://caldaro.wordpress.com/2011/08/11/history-may-not-repeat-but-it-always-rhymes/.

The market has just had the best rally since this downtrend began: (SPX 1102-1189). The previous best rally was Int. wave ii: (SPX 1296-1347). At the recent low the market was the most oversold it had been since November 2008 in the last bear market. The VIX shot up to 48 early in the week, implying 3% daily volatility. It declined into the upper 30′s by week end, implying 2% daily volatility. We added some labels to the charts, and are expecting it to exceed the recent high in the months ahead.

SHORT TERM

Support for the SPX is now at 1176 and then 1168, with resistance at the 1187 and 1222 pivot ranges. Short term momentum got overbought on thursday/friday, for the first time in three weeks, before tailing off by the end of the day. The market will now have to decline below the OEW 1168 pivot to signal the start of Int. wave v. Should this downtrend bottom at the OEW 1090 pivot and Fibonacci cluster, we would expect the next uptrend to return to the 1187 pivot and even the 1222 pivot in September. The next uptrend will be quite important in determining whether or not this market is doing a 5-3-5 zigzag again, like in 2007-2009, or an abc-x-abc, (abA-B-abC) double zigzag. Depending upon which pattern is developing we should get a better idea of how this bear market is going to unfold. Best to your trading!

http://caldaro.wordpress.com/

Posts from CNBC: My Idol Guppy Trader 8-10-2011

The Dow Could Fall to 9700 in the Long Term: Charts

Published: Tuesday, 9 Aug 2011 | 7:35 PM ET

Remember the people who told you in early 2008 that the market sell-off was “irrational” and driven only by “fear?.”

Click on graph to enlarge

“Don’t sell,” they said, “you are in for the long term so look for bargains.” These same people are back. They couldn’t read a chart then and they cannot read a chart now.

How much worse can this get? Much worse. Particularly as U.S. analysts, fund managers and politicians, including the President are in denial. “America will always be a triple A country” is a refusal to face debt facts. Blaming, and investigating Standard and Poor’s is like attacking the teacher because you got bad marks in a school report – even worse when you say the same agency has accurate ratings on European debt.

Downside targets on the Dow are 10600 with a long-term potential at 9700. Downside targets on the Nasdaq are 2370 (already exceeded) with longer-term targets near 2100. Downside targets on the S&P 500 are 1130 (already exceeded) with longer-term targets between 950 and 1000.

Strategies for survival include:

Cut profits quickly and exit if it is not already too late.

Take small losses now – if its not already too late.

Trade short physical equities.

Trade short equity and indexes using CFD leverage.

Use CFDs to trade international markets where your own market offers limited short opportunities.

Trade gold for short term upside moves. Remember gold is priced in U.S. dollars and U.S. dollar will weaken.

Do not buy bargains. Wait for consolidation and end of downtrend patterns to develop.
Trading ultra short term – 10 minutes to several hours. This is the same as 2008, but worse because markets are coming off an already weak position.

Back in June we noted the developing head and shoulder reversal pattern in the Dow. As with all our technical analysis we discussed the conditions that validated and invalidated the pattern. Because the head and shoulder pattern is an end of trend pattern we spent more time discussing the downside targets and how they were calculated.

Technical analysis is not a popularity contest. The analysis method strips out the emotions, the funny accounting figures and outright accounting frauds and looks at the behavior and thinking of participants as identified through their buying and selling activity. Technical analysis looks at the opinions of those who count – the opinions that are backed by cash in the market or withdrawn from the market.

Its not a perfect analysis method and nor is it mechanical. If it were then technical analysis would be slotted into a computer program. The analysis of the relationships and behaviors shown on the price chart calls for some skill and experience. And even then it is not proof against error because despite our best intentions there are times when emotions and disbelief cloud our judgement. Our 2008 head and shoulder downside targets seemed unbelievable in late 2007. In fact they were conservative targets.

However good technical analysis provides the conditions that validate and invalidates the conclusions. The aim is to identify trigger points that signal a need for action, or a need to reverse a previous position.

The head and shoulders pattern on the Dow is a double pattern. It includes a larger pattern and a smaller pattern. In June the smaller pattern was close to confirmation and based on this the downside targets were 11700. By the end of July the larger head and shoulder pattern had been confirmed and this set new downside targets near 11600.

Whilst its always satisfying to have analysis validated by the market, it is even more satisfying to have used this analysis to lock in profits, avoid losses and be prepared to go short when the first signals are delivered.

And that underlines the next important step in taking technical analysis and turning it into trading profits. The head and shoulder pattern is a reversal pattern and it allows for the calculation of a measured move. It helps to set downside targets. This tells us the best side of the market is the short side until the index moves towards these target levels. Then traders wait to see how the support level acts as a rebound point. It is the nature of this rebound that provides the next set of long side opportunities.

We call it catching the bounce and its covered on more detail in one of our DVDs. This analysis tells us if it is better to trade the bounce as a rally, or when to trade it as the start of a new sustainable uptrend.

Technical analysis is not about being right or wrong in predicting how the market will behave. It’s about identifying the balance of probability and then identifying those conditions that tell us when the balance of probability has shifted. Those who are looking for prediction need to look to methods other than technical and chart analysis.

==================

Dow Likely to Drop to 10,600: Charts

Published: Thursday, 4 Aug 2011 | 8:34 PM ET

The rough ride for equities may not be over, according to the charts. After losing 500 points on Thursday, the Dow could drop another 700 point before finding some support, Darryl Guppy, CEO of Guppytraders.com told CNBC on Friday morning.

"With the head and shoulder pattern in the Dow, it's giving us a downside target projection of around 10,600," Guppy said, after Wall Street suffered its worst sell-off since early 2009.

Guppy believes the 3 major U.S. indices - Dow [.DJI 10909.52 -330.25 (-2.94%) ], S&P 500 [.SPX 1138.85 -33.68 (-2.87%) ] and Nasdaq [.IXIC 2416.22 -66.30 (-2.67%) ]are likely to hit their downside targets.

"The key factor is we are now beyond the crossroads," he warned, "For instance the S&P, we've moved below the neckline value and we've moved below the neckline value in the Nasdaq."

He thinks the Nasdaq could hit 2300, a 250 point move down from Thursday's close; and the S&P 500 could hit 1140.

The Dow and the S&P 500 shed over 4 percent on Thursday. The S&P is now in correction territory, having lost more than 10 percent since its April 29 high.

The selling continued well into Asia, with the Nikkei falling as much as 4 percent in early Asia trade.

For investors looking to buy on the dips, Guppy said there may be some "bear reliefs" on the way down but investors should wait it out.

"This is not a good time to go buying bargains, bargains will be coming in a few weeks time."

NYAD early warning 2 weeks ago. 8-9-2011

Could have evaded this downfall if I had drawn and took a look at the early warning of NYAD..

The RSI for the past 12 months is consistent in declaring a Negative Divergence ongoing even though NYAD is rising fast. Could have been better months/ weeks ago.



NYAD = New York Advance/Decline Line. (cumulative weekly charts)

(REVISED)Market Bearish Check: DOW, PSE, HK, AORD, FTSE, DAX 8-8-2011

REVISED the Outlook, as the 5% drop last night changed the entire forecast....

This is the worst Ghost month in this Decade. Cutting of 10% in just 1 week time, without any Major reason, all are based on Fear and consumer sentiments. All people are optimistic, but Jobs, Bonds, Bailouts are popping out and asking for help.

What went WRONG in the DOW JOnes was the major 500 pt crash that had happened, if it was only a 200pt drop to the 12000 level, we are still 100% in a bull market.

Now that it dropped off to 12000,11700 and 11500 critical supports, I am one of the bearish people now thinking how to defend this market. 50% bullish, 50% bearish.(50% chance of going into recession/double dip as well).

I actually did not expect this to happen, the downgrade of U.S. Sovereign debt should have had only 200pt decline, it did a whooping 500pt decline that made a Breakdown of markets, making Medium term and short term Bearish and downtrend.

I have made charts below to illustrate the Medium Term bearishness of the markets, but is still hopeful for the Long Term uptrend lines I made below. Overall, RSI around 20s, few months/years from now, if Defaults/Bailouts will soon arrive, A decline to 10,000 level is not impossible.

Forecast: Possible support at 10500-10800, a Whooping 15 RSI (10yr low) then a 4-8% rally before a possible downturn swing happens. Bull Market in U.S. Still possible, but last night, Europe's technical charts confirmed they are in Recession and in extreme Bear Market.



PSE


HongKong


Australia - Broke down, possible 3700-3900 support


Germany (BROKE DOWN) - confirmed breakdown with 5300-5500 possible support


London (BROKE DOWN) - confirmed Bear Market at possible 4800 Support

repost: bear market might be coming.....

Even if i am away of PH, trying to take a relaxing vacation at angkor wat cambodia, every minute i am tempting to find a wifi to analyze things up, as i know 12000 is a very important support for the u.s, with now at 11300 level, seems that a probable recession is coming earlier than expexted. i will temporary leave my readers to scan through tony caldaro's post below...

SHORT TERM: market tumbles after gap down opening, DOW -513

Overnight the Asian markets were mixed. Europe opened higher but closed -3.3%. US index futures were lower overnight, and at 8:30 the weekly Jobless report came in flat: 400K vs 399K. The market gapped down at the open for the fifth time in nine trading days. The SPX opened at 1249 and immediately dropped to 1236 in the first few minutes. The SPX had closed at 1260 yesterday. After a bounce to SPX 1242 the downtrend made a new low for the ninth consecutive day when it hit 1233. Then after a rally to SPX 1240 by 10:30, the market broke through the OEW 1240 pivot range and headed to the lower ended of the 1222 pivot range at 1216. A good rally followed to SPX 1232 by 1:00. But even that rally was met with additional selling as the SPX hit 1212 by 2:30. After another rally attempt to SPX 1222 by 3:00 the market dropped to 1200 and closed there.

For the day the SPX/DOW were -4.55%, and the NDX/NAZ were -4.80%. Bonds gained 41 ticks, Crude dropped $5.45, Gold slipped $13.00, and the USD soared. Support for the SPX drops down to 1187 and then 1176, with resistance now at 1222 and then 1240. Short term momentum remains oversold. Tomorrow, the monthly Payrolls report at 8:30 then Consumer credit at 3:00.

Today certainly looked like some sort of capitulation day. As noted, the market gapped down for the fifth time in nine trading days, tried to rally, but trended lower all day. Even before today’s final low the market overlapped the April 2010 Primary wave I SPX 1220 high. With the current wave structure there is only one highly probable count. The one posted. A bear market is underway.



Long term support should first appear around the low of Primary II at SPX 1011. Should that fail to hold we’re looking at the low of Major wave 2 at SPX 869. It’s not good news. In fact, it’s quite disappointing. We expected, and the waves projected, a lot more upside out of the bull market. But as we have reported foreign markets, and market internals started to break down. When the selling pressure became too intense to support additional higher rising trends, Primary waves III and V truncated. Yes, we had five waves up from the March 09 low, and yes, it was a bull market.

Short term support is at the OEW 1187 pivots, and then 1176 and 1168 pivots. These two lower pivots created support during Major wave 4 of Primary wave III in November 2010. Overhead resistance is now at the OEW 1222 aand 1240 pivots. Short term momentum continues to diverge but has been of little help. Daily momentum is now extremely oversold. The short term OEW charts have been negative since SPX 1335. Will take a strong rally back to 1260 to turn them positive again. Best to your trading/investing!

MEDIUM TERM: downtrend continues

LONG TERM: bear market highly probable

CHARTS: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987

Categories: Updates
Tags: business, economy, elliott wave, finance, investing, markets, OEW