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Wednesday, May 12, 2010

Wednesday updates

After the bell, The SPX has almost reached the 50 day MA at 1073.79, closing just shy by two points, in a bearish wedge formation, that can be counted as an ending diaganol. Both the bullish and bearish options highest probabilities are pointing to a sell-off tomorrow, if we do head higher, the bearish count is in BIG trouble and I would have to replace the 3-4 on the bullish count, with another 1-2 up count. The really short-term intraday trend was up today as it made two higher highs, but the larger trend remains neutral until we break above the resistance of the red-dashed making higher highs, or we break below 1147.24. If we do get a sell-off, the bullish count is not off the table until we break below Thursday's low of 1065.79. It is looking like both these counts are going to remain valid until we either make a new high, or break below 1065.
Breadth for the day closed at 6.17:1, advancers, this is very respectable number, and should make the bears nervous. BTW, I went thru 300+ charts yesterday from my public and private collection, and from what I saw, I would give the bulls a slight advantage right now, and if we do make a new high on the SPX, we would also be breaking above the 200 week MA that is sitting at 1223.07 right now, that would be a very bullish long-term signal. The bears need to show their stuff because time is running out quickly on the longer term charts.

**** I have came to a cross-road, to where my expenses to keep this blog up and running are far exceeding the in-coming revenue. With the number of new subscribers to EWI for the last two months down to nil, and existing ones cancelling their subscriptions (who can blame them), my monthly payments no longer make it worth contining a relationship with EWI, if it were not for their resources they provide for free, they would of already been removed from the blog. Without the revenue that EWI was providing I am now operating in the red this month, because good ole Uncle Sam has his hand out, and the revenue this blog has received is reportable income, this has put us in a spot to where we had to choose from operating as a Sole Proprietorship, or as a Limited Liability Company. Upon advice from my Attorney, and seconded by my CPA, The LLC was the best choice because of the firewall it provides between the blog, and our personal assets. I got the bill today!!!!
I can not continue operating in the red, and with-out the income from EWI at the levels from a few months ago, I see no way to get back into the black. I devote many hours per day watching the market, help keeping the CiL running smooth, and keeping the blog updated thru-out the day for free. Somebody has to be getting benefits from all my hard work, or else I would not be getting 3000-4000 unique visitors a day. This is where I ask for your support, if you can , please help out on a monthly basis as I much prefer to keep this blog free, neither of the two remaining options excite me, some sort of a pay-service to support it or stopping altogether. If EWI can get $79 a month for three short-term updates a week, these blog has to have some value. Please leave comments if you have any, maybe somebody has another solution I have not thought of!!!!
9:28, I normally do not track Gold day to day, but after the large move this week, it is possible that Gold has broke out in a iii of 3 wave up, after making a new all-time high yesterday, the RSI is still not back up to the levels seen in December '09, and shows no signs of divergence yet, and the most telling part, is the candle from yesterday, which looks like a nice point of recognition for a iii of 3 wave.

Click here for a live, and updated chart!!!
8:46, The market still has not tipped its hand on which way it wants to go, both the bullish and bearish options are valid, and the trend is still neutral. As time goes on, and the market stays up at these levels, the odds are going to favor the bulls. We have not made any minor higher highs, or lower lows today, so even the shortest-term time frame is neutral. On the bullish count, the best option right now is we are in a 4th wave that could spend another day consolidating before heading higher for its 5th wave. The 1177 level where the red dashed line marks the last major high, is the line in the sand for the bears, and 1173.37, the 50 day MA, is an early warning sign that the trend is favoring the bulls.
Click here for a live, and updated chart!!!
8:11, The Long term Fib fan chart still has the SPX caught between short-term resistance (neon-green), and medium-term support (gray), this is bullish as long as that support holds.

Click here for a live, and updated chart!!!
7:51, If the VIX were to break down below the trendline of support, it would be another blow to the bears, as long as it holds, there is a much better chance that the bearish wave count on the SPX still has some legs. Once it is broken, I imagine that those gaps down below will get filled, allowing the indexes to make new highs.


  1. Seeing this despair in the blogging community, Kenny has a similar stance, makes me believe this might be the top in wave 2 of P3.

    I am one of your 4000 regulars every night and I enjoy your comments. I have one suggestion that you might want to try before quitting your blog if you cant obtain income via subscriptions.

    If your analysis is as good as you say, why not start a public (virtual) trading account that people can follow for free on your blog? Something similar to what Glenn Neely does. It should trade at a frequency that most working people can handle, i.e. not more frequently than once per day, and it should utilize preset stops and entry points to simplify trading. If this account starts paying of in virtual money you can soon start charging big buck from your visitors.

    Just an idea.

  2. Mike
    You are not alone, almost every blog I have been following had to go to a pay type of subscription service to make ends meet. Some are trying to get $100+/mo while others as little as $15/mo. I understand that you cannot operate in the red and you shouldn't.

    I think you have no other option other than a pay type of system at least until the ad revenue returns. But what I would like to see is a way for subscribers to by pass Pay Pal which takes a cut, and it would be nice if we could pay you cash/check some how so you wouldn't have to share it with Obama Inc. This could help keep the monthly fee down.

    Although I don't understand EW completely I do get a general sense of where the market is heading from your write ups. To me if you shut down, that would be a huge lost.

    Just my 2 cents. Not much help I know, but that is all I can think of right now.

  3. Col
    You could count on the beer money :-), but if that was working you probably wouldn't have to write that paragraph. I think the only way to guarantee income is with some sort of service fee. However, an open site where you encourage many people to be involved, is tough when you have payers and non-payers.
    From being on CIL, I sense you don't want to create a subscription service. How about a low $ fee per QTR for being in the CIL and members of the club are satisfied that they are helping you and others provide the service. It goes against the spirit of the site but I think most people would rather pay something than have it go away. Let’s assume 100 sign up. What’s your fee requirement?

  4. Pontus, That is something I have tried, the WallStreet Survior, and when the market gets moving fast, I do not have time to adjust my trades on it. Last Thursday morning I posted that 1-2, 1-2, 1-2 down count, and did not even have time to add to my shorts, or sell them after the bounce because I was so busy keeping my counts updated for you guys.

  5. Kim, The cut that Paypal takes, is a lot less then Uncle Sam, donations are not taxable ;)

  6. Mike, The beer money is not much, 3-4 people a month have been gracious enough to help out with the free beer request. And for a mere 50 cents a month per person would cover everything and some. The people that are posting on the CiL already give much more then they take, I would like some of the others to donate who check out my blog everyday, the ones that do not even read the CiL. :)

  7. col

    gary kaminsky said at end of FM tonight, "buy VIX"


  8. Before you quit or go subscription, try the donation button for a month or so. My guess is you only need a few hundred and if only 10% actually send you $5 or $10 bucks each you could be good for several months.

    That or more advertising?

    All the best.

  9. Could you please email me directly at nboutelier at gmail dot com. Im a fan of the blog and would love to help.