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Tuesday, November 16, 2010

Tuesday updates!!!

Here is the longer-term count I have been using, if this does escalate into a major sell-off, the 1125 area of support will be a very important level, a break below this trendline opens the door to a run down to the gray line in the 800 level.
***Note- I should have the last green 3, 4, and 5 in question marks because it is still unclear if we had a 3rd, or a 5th for the recent top.
***Dollar update, the Dollar is now testing the upper channel line and now has $79.58 as the HOD.

This is a look at the weekly SPX with the Trendfinder indicators on it.
Although this recent sell-off has changed to looking more impulsive then corrective after this morning action, it could still be part of a larger degree 4th wave where a 38% retrace is not uncommon. That level is still a few points away, down around the 1155 level. The absolute lowest this could go and still be part of a 4th wave is all the way down 1129.25, the high of the 1st wave back in early August. If it is an impulsive wave down we need to wait for it to play out further to see how it could fit into the larger picture.
Gold is getting hammered today, down another $35 bucks to $1329, and has broke support from the trendline. Next level of support is at $1315 from the previous low back on 10/22.
The SPX broke thru support of the 20 day MA hard this morning, the next level is support is from the 50 day MA at 1165.31, also in the same area as the lower Bollinger band. All indicators are in sell mode, but are quickly reaching over-sold levels, except the MACD on the daily chart.
**Breadth update, continues to rise and is now currently at 16.93:1, this is VERY bearish if it holds thru the close.
8:43, The Dollar continues its bullish move up closing in on the channel line which in going to be an important level of resistance, breaking above moves the Dollar into a longer-term up trend. The HOD is now at $76.36.
8:29, The VIX is rocking today, up over 11% and close to making a higher high. 23.37 is where the 200 day MA is at, that should provide another level of resistance. If the SPX is truly in a 1-2, 1-2 down count, the 200 day MA most likely will not last long as the VIX heads higher.
8:15, Here is the other option, a 1-2, 1-2 down, this option is really gather steam as the market internals are getting much more bearish then a standard 4th wave decline should have, breadth now at 15.62:1!!!!!
Click here for a live, and updated chart!!!
Wow, the SPX finally broke the lower green channel line with enthusiasm, current breadth numbers are at an astonishing 9.74:1, decliners!!!
This opens the door further for an option of a 1-2, 1-2 down count instead of a corrective a-b-c-x-a-b-c, double zig-zag for the "A" wave of the 4th. The 20 day MA was also breached this morning.


  1. So I assume you have changed how you do the 25% increment recs? I am signed up to receive alerts and would have expected to receive a message saying go x% bearish by now. Love the work...thx

  2. Mark, yes, the SPX went bearish on the 10th. I did twitter this.
    "-columbia1 the daily chart of the SPX with the trend finder just went bearish
    7:07 AM Nov 10th"
    The new trend finder is no longer in increments because that amount of time it required to post the changes, the new system is quicker and I get e-mail updates as soon as a change takes place, instead of having to watch 12 charts. Also I can now track more then just the SPX.

  3. So given your old TF, when the daily (short term) trend goes bearish would that usually be a 25-50% signal. Then when the longer goes bearish that would be the 100%...just for continuity's sake.

  4. Also, have you backtested the new short term and long term signals by themselves as well as in combination some way?

  5. Mark, the old system was based on hourly and daily charts 50/50. I no longer use the hourly charts because it was creating to many weak signals. Now I use the Daily for my own trading, I did add a weekly and monthly for people who were interested in longer-term swings. That was one of the problems of the old system, people where unsure of the time frames. The daily charts give an average of two trades a month, where as the hourly was giving upwards of 30 a month. The hourly charts where whip-sawing a lot during the last two months because of all the over-lapping waves on the SPX, going to the daily smooths that out. BTW, the weekly averages 3-4 trades a year for long-term swing traders, and the monthly is around 1 trade ever 2 years, for LONG-term investors

  6. Michael - have a long term count that would explain the recent moves - that a high is in. Where I have the X wave (and most have a wave 3)is a pattern typically found in forex trading. Let me know what you think. Thx.

  7. Mark, I just added the weekly SPX with the trend finder

  8. Tom, I do like that count also, it is very close to my SPX longer-term chart

  9. Thanks Michael...the weekly is very helpful. I'm sure you already posted the daily one. Can you do so again or tell me the day it was posted. Thanks!

  10. Mark, I will post a new one after the close :)

  11. I am using a simpler timing system, EMA25 crossing EMA50 on hourly chart. The system gave me a buy signal at 1080 on S&P500 and a sell signal yesterday at 1,200. It worked almost perfect this year with only two minor whip-saw.

    Check out my blog:

  12. Michael, do you have backtested results for both the weekly and daily in TF2 like you did for the combined in TF1? Love to see what it looks like. Also, if you could post or redirect me to the TF2 chart for daily I would greatly appreciate it. Thanks for the great work and insight!